Last updated : 11.05.2026
Expense rules in Cyprus.
Cyprus applies VAT at 19% and offers an attractive tax regime (CIT 12.5%). EU member since 2004, eurozone since 2008.
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1Expense rules & reclaimable VAT
VAT 19% standard, 9% hotels/restaurants, 5% medicines. EU recovery available.
| Category | VAT | Reclaim | Cap / Note |
|---|---|---|---|
| Meals | 9% | Deductible | EU-compliant invoice |
| Lodging | 9% | Deductible | Company invoice |
| Alcohol | 19% | Limited | Excluded from business meals |
| Fuel | 19% | Deductible | Detailed invoice |
| Transport | 19% | Deductible | Taxi/airfare/ferry |
| Client gifts | 19% | Non-deductible | EUR 17 cap |
Receipt
EU invoice
VAT number required
Meal cap
<= EUR 50/pers
Above: justify
SourcesCyprus Tax Authority
2Mileage allowance
No official mileage scale. Reimbursement by company agreement (typically EUR 0.25-0.30/km).
| Mode | Allowance | Cap | Note |
|---|---|---|---|
| Personal car | EUR 0,28 | Company agreement | Capped by agreement |
| Company car | – | Fuel card | – |
| Taxi/Bolt | – | 100% on receipt | Receipt required |
Tracking
Logbook
Date, distance, purpose
SourcesCyprus Tax Authority
3Per diem and travel allowances
No official tax per diem. Company policy typically EUR 100-180/day by city.
| Destination | Meal | Lodging / night | Daily rate |
|---|---|---|---|
| Nicosia | EUR 25 | EUR 90 | EUR 140 |
| Limassol | EUR 30 | EUR 110 | EUR 170 |
| Larnaca | EUR 25 | EUR 85 | EUR 130 |
| Paphos | EUR 25 | EUR 90 | EUR 140 |
Currency
EUR
Eurozone
SourcesCyprus Tax Authority
4Foreign VAT recovery
VAT recovery via 8th Directive (EU companies) or 13th Directive (non-EU, subject to reciprocity).
| Zone | Mechanism | Deadline | Method |
|---|---|---|---|
| EU companies | 8th directive | Sept 30 (year N+1) | Electronic portal |
| Non-EU companies | 13th directive | Sept 30 (year N+1) | Paper application |
| CY companies | Immediate credit | Quarterly | VAT return |
Statute of limitations
6 years
Keep invoices
SourcesCyprus Tax Authority
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