UK pension in Cyprus: how foreign pensions are taxed

Retirees who become Cyprus tax resident can choose each year how a foreign pension for work done abroad is taxed: 5% on the part above €5,000 (from tax year 2026) or the normal bands. We compare the options every year and applies the tax treaty with your home country.

ForRetirees
OptionSpecial rate or normal bands
TreatyAvoid double tax
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A founder working on a laptop at a cafe terrace in LimassolChecked 28 October 2026

Steps and timeline

  1. 1

    Check treaty

    Where your pension is taxable.

    1 week
  2. 2

    Choose option

    Compare the special rate with the normal scale; you can choose again every year.

    yearly
  3. 3

    File

    Personal return.

    yearly

Official forms explained

Official form: T.D.156 (Τ.Φ.156) · how to fill it in

Who does what

What you do

  • Share your situation and goals
  • Collect documents from home
  • Agree the scope of work in writing

What we do

  • Check the requirements for your case
  • Prepare the documents and file the application
  • Follow up until the decision

Your coordinator

  • Plans the work and next steps
  • Keeps one timeline for everything
  • Reminds you of renewals and deadlines

Common mistakes

  • Choosing once and forgetting: the option can change every year
  • Using the special rate for a pension from work in Cyprus: it covers only work done abroad
  • Ignoring the treaty: some pensions stay taxable in the home country
  • Forgetting GESY on the pension

What affects the cost

The price depends on your situation. We explain the scope and expected costs before work begins.

Number and type of pensionsTreaty with your home countryOther income in Cyprus

Questions

Are government pensions treated the same?

Often not. Under most tax treaties only the paying country taxes a pension for government service. The exception is when you are a national of your new country of residence. We check the treaty with your home country.

Which option is cheaper?

It depends on the size of the pension. On a €30,000 foreign pension, the special rate costs €1,250: 5% on the €25,000 above €5,000. The normal scale costs about €1,600 before other deductions. On €20,000 the normal scale wins: €0, as it is under the tax-free €22,000, against €750 at the special rate.

Is the pension added to my other income?

Not with the special rate. The foreign pension is taxed on its own, so your other income stays in its own bands (Income Tax Law, section 20). On the normal scale everything is added together.

Is GESY due on a foreign pension?

Yes. Residents pay GESY of 2.65% on pensions, whichever tax option they choose.

Sources

Figures checked 28 October 2026. Rules change: we confirm them for your case before you act.

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A coordinator replies within one working day with the next steps.

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