How dividend tax works in Cyprus
Cyprus generally does not levy withholding tax on dividends paid to nonresidents. For most inbound and outbound structures, the headline Cyprus dividend withholding rate is 0%.
For Cyprus tax resident individuals who are also domiciled for SDC purposes, dividends are subject to Special Defence Contribution at 5% on profits earned after 1 January 2026. Transitional rules apply for older profits.
Defensive rules can impose 5% withholding on certain dividends to associated companies in low-tax jurisdictions and 17% on certain dividends to associated companies in EU non-cooperative jurisdictions, so dividend routing needs a jurisdiction-by-jurisdiction check.
Tax rates at a glance
- General dividend WHT
- 0%General rule
- SDC on resident dividends
- 5%
- Dividend WHT to low-tax jurisdictions
- 5% / 17%
- Non-dom dividends
- 0%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
InvestorsHolding companiesFoundersFamily officesExpats
Watch out for
- Dividends paid by a Cyprus company are usually simple for nonresident shareholders, but low-tax-jurisdiction and anti-abuse rules can change the answer.
- Resident domiciled individuals still need to track SDC and GESY on dividend income.
- Foreign withholding tax may still apply before the dividend reaches Cyprus.
Frequently asked questions
Does Cyprus tax dividends?
Usually no withholding tax applies, but Cyprus-domiciled resident individuals can owe 5% Special Defence Contribution on dividends from 2026 profits.
Does Cyprus have dividend withholding tax?
Generally no, except for specific related-company payments to low-tax or EU non-cooperative jurisdictions, where 5% or 17% withholding can apply.
Are non-doms taxed on dividends in Cyprus?
Usually no. Non-domiciled Cyprus tax residents are generally exempt from Special Defence Contribution on dividends.