Cyprus Non-Domicile Status is a category of tax residency available to individuals who have not been domiciled in Cyprus for more than 17 of the last 20 years. Individuals who qualify are entirely exempt from the Special Defence Contribution (SDC), which is the Cyprus tax on passive income including dividends, interest, and rental income. In practice, this means a qualifying non-dom Cyprus tax resident pays zero tax on dividends received from a Cyprus or foreign holding company.
The non-dom regime was introduced in 2015 specifically to attract wealthy individuals, entrepreneurs, and corporate executives to relocate to Cyprus. It is one of the most powerful exemptions in the Cyprus tax system and is highly relevant for founders of IP-holding structures, fund managers receiving carried interest, and expats drawing dividends from international corporate groups. The 17-year clock restarts each time an individual ceases Cyprus domicile, giving significant long-term planning flexibility.
Domicile of origin under Cyprus law generally follows the father's domicile at birth. Individuals with a non-Cyprus domicile of origin who subsequently acquire Cyprus tax residency will typically satisfy the non-dom conditions immediately, subject to the 17-year threshold. Legal advice should be obtained for complex family or estate situations.