Following pressure from the European Commission and concerns about the monitoring of residency and citizenship by investment schemes, the Cypriot government announced changes to its residency programme in May 2023.
While the Civil Registry and Migration Department continues to offer residency by investment visas, the minimum investment thresholds have risen, and some extended family members who could previously be included on the application are now not permitted.
The previous Cypriot golden visa scheme that allowed foreign nationals to apply for Cypriot citizenship was abolished in 2020, citing abuses when investigators found that applicants under investigation for money laundering had attempted to gain EU passports through the programme.
Updated Eligibility Requirements for the Cyprus Residency by Investment Visa
After being temporarily suspended, the newly updated scheme was launched earlier this year, with several reforms to the requirements, investment values and obligations included. In terms of general eligibility, any foreign national applying for Cypriot residency or holding permanent residency status must:
- Visit Cyprus in person at least once every two years.
- Transfer funds from an overseas bank account to Cyprus to make qualifying investments.
- Pay government fees of €500, plus €70 for each dependent.
- Have a clean criminal record certificate.
- Submit complete application documents with a two-month average processing time.
- Receive approval from the Minister of the Interior.
Foreign nationals cannot be employed within Cyprus but are allowed to act as directors if they are establishing a business within the country to meet the investment requirements. They can also be a shareholder in a Cypriot-registered company but can only serve as a director if they do not earn a salary.
Investment Requirements and Proof of Wealth
The minimum investment value has increased to €300,000 plus VAT, and foreign investors can meet this condition by selecting one of the following options:
- Purchasing a newly built residential property. Investors can buy two smaller homes for the same value, and off-plan real estate is eligible.
- Buying a commercial property, or combination of smaller commercial properties, such as hotels, offices or shops.
- Investing in share capital within a Cypriot company – the business must be based in Cyprus with a proven physical presence and at least five employees.
- Purchasing fund units through the Cyprus Collective Investment Organisation.
Most applicants opt for a property purchase to meet the investment requirement. However, there is no preference or difference in how an application is processed based on the chosen investment option.
In addition to investing in the Cypriot economy, residency by investment applicants must prove that their funds originate from abroad and evidence a secured annual income of at least €50,000. Expats applying with a spouse need to show earnings of €65,000 a year, plus an additional €10,000 for every dependent child.
Qualifying annual income can arise through employment, pension benefits, dividend earnings, rental proceeds or from a fixed deposit.
Applying for Cypriot Residency With Dependent Family Members
One of the changes made was to remove the option of adding a parent or parent-in-law to the application, although expats can apply for a residence permit for the following relatives alongside the main applicant:
- A spouse – with an official marriage certificate.
- Children up to age 18.
- Children between 18 and 25 who are enrolled at a university and are unmarried.
If an applicant wishes to move to Cyprus as a permanent resident with a university-age child, they must ensure they have an appropriate student visa. Once the child has completed their course, they can apply for an Immigration Permit.
Benefits of Cyprus Residency by Investment
Despite the higher investment requirement and the tighter restrictions around family members, the visa scheme remains in high demand, and Cyprus offers a number of advantages. Successful applicants are granted full and permanent residency status and can live in Cyprus or travel across its borders without limitations.
They are eligible for treatments and services under the Cypriot General Healthcare System and do not need to meet any minimum stay requirements – although they must visit the island at least once every two years, as we’ve mentioned.
Cyprus has a tax regime that is often seen as favourable, particularly for high net worth tax residents, without any inheritance tax, tax against worldwide dividends, income or interest earnings – although an assessment of your tax position and potential exposure to UK inheritance tax remains essential.
Many expats also choose Cyprus as either a second home or relocation destination due to the scenery, quality of life and near-perfect Mediterranean climate, with miles of sandy beaches and an average of 320 days of sunshine per year.
After five years, a permanent resident becomes eligible for citizenship, should they wish to apply, and can secure a Cypriot passport with visa-free travel freedoms and the option of living or working anywhere within the European Union and Schengen Zone.
Potential Future Changes to the Residency by Investment Scheme in Cyprus
It is worth noting that there is the possibility that the government will make further amendments to the Cyprus golden visa programme, the eligibility criteria or the investment requirements.
While the updated scheme was introduced in May 2023, residency by investment programmes remain a matter of contention, with the EC having previously published reports highlighting its concerns that residence schemes may be exposed to tax evasion and other criminal activities.
Applicants should also be conscious that they need to submit an annual declaration to retain permanent residency status, including:
- Evidence that they continue to hold their qualifying investment.
- Proof of ongoing annual income as above.
- Documentation showing valid medical insurance coverage – if they are not registered with the national healthcare service.
- A clean criminal record validated from their country of origin and country of residence, where applicable.
The residence permit is valid indefinitely but can be withdrawn by the Civil Registry and Migration Department at any stage if these conditions are not met – including the permits for any family members or a dependent spouse granted on the same application.
Children under 18 who are granted Cypriot residency through the investment scheme remain residents until they reach 18. They must reapply at that point, assuming they comply with all the relevant criteria.
For more information or support regarding your move to Cyprus, please contact our local Chase Buchanan Wealth Management team in Paphos.
*Information correct as of January 2024