Foreign pension tax
A pension from abroad can be taxed at 5% above €5,000 a year instead of the normal scale. Enter your pension and other income to see both and the GESY contribution.
Rules checked October 2026Your income in 2026
The 5% option is lower
- 5% above €5,000
- €1,250
- Normal 2026 scale
- €1,600
- GESY (2.65%)
- €795
You choose each year. Tax on other income is the same in both options.
GESY on a foreign pension is still being confirmed with the Health Insurance Organisation.
A guide based on published rules, not tax advice.
How it works
- 1
Two options
5% on the pension above €5,000, or the normal 2026 scale on all income.
- 2
Every year
You choose the cheaper option in each tax return.
- 3
GESY
2.65% on pensions, on income up to €180,000.
Questions
Is a lump sum taxed?
A lump sum from commuting a pension is exempt; a foreign scheme is checked case by case.
Is SDC charged on pensions?
No: the defence contribution covers dividends and interest.
Sources and limits
- Income Tax Law 118(I)/2002 (consolidated, cylaw.org): article 8, foreign pension taxed at 5% above €5,000 on election, checked 28 October 2026
- Health Insurance Organisation: GHS financing, contribution on pensions, checked 28 October 2026
- PwC Worldwide Tax Summaries: Cyprus individual income determination (reviewed 4 August 2026), checked 28 October 2026
- PwC Worldwide Tax Summaries: Cyprus taxes on personal income (reviewed 4 August 2026), checked 28 October 2026
- Andersen Cyprus: 2026 tax reform updates, checked 28 October 2026
- Ministry of Finance (gov.cy): tax incentives
- Individual Income Tax Return — Tax Department
A model of published rules, not tax advice. Rules checked October 2026; we confirm them for your case before you act.
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