- Cyprus amended its VAT Law on 27 Feb 2026, effective 1 Sep 2026, changing how “new” buildings and renovations are treated for VAT.
- “First occupation” and “first use” are redefined: a building is considered used only after systematic use for at least 18 months, replacing the earlier 5-year/24-month framework.
- Any sale of a building (and land) before 18 months of systematic use may now be subject to VAT.
- The 5% reduced VAT rate rules are also updated, so some buildings can still qualify for the reduced rate even if they are “new,” provided other conditions are met.
- Developers, sellers, buyers, and investors should document and track first systematic use carefully to manage VAT risk.
Source: deloitte.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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