Updated
GL-A-07
Glossary · Cyprus PR
The 18-month rule in Cyprus - when a building counts as new for VAT
A building without 18 months of systematic use counts as new for VAT
01 / In 30 seconds
The short answer
- What it is
- A building without 18 months of systematic use counts as new for VAT
- From
- 01.09.2026, Orders 102/2026 and 103/2026
- What it changes
- Such a sale carries 19% VAT and no transfer fee
- For PR
- Key for resale commercial property under option B
02 / In plain words
What 18-month new building rule means
The 18-month rule decides when a building counts as new for VAT. From 01.09.2026, under Orders 102/2026 and 103/2026, a building remains new until it has been in systematic use for 18 months.
For a buyer this changes the tax. If a property is formally a resale but has been used for less than 18 months, the sale carries 19% VAT and no transfer fee. Once 18 months have passed, a transfer fee of 3/5/8% with a 50% discount applies instead of VAT.
For PR the rule matters most for commercial property under option B: resales are allowed there and the tax difference is large. On €300,000 it is a €8,600 transfer fee versus €57,000 VAT. So before any deposit we check when the building came into use.
A simple example
A client chooses an office for PR at €300,000. The building was completed 10 months ago and used for less than 18 months: the sale carries 19% VAT, €57,000. An office in a 3-year-old building would cost a €8,600 transfer fee.
When the 18-month rule matters
- Buying resale commercial property for PR
- Buying a recently built property from its first owner
- Comparing transfer fee and VAT
- Budgeting the purchase
- Selling your own property
03 / What it covers
Key facts about the 18-month rule
The rule
- No 18 months of use
- Building counts as new
- From 01.09.2026
Tax
- Under 18 months - 19% VAT
- Over - transfer fee
- No fee with VAT
Example at €300,000
- VAT €57,000
- Transfer fee €8,600
- Difference €48,400
What we check
- Date of first use
- History of use
- Seller's VAT position
04 / How it works
How we check the 18-month rule
Completion date
When the building was finished and ready for use.
History of use
Whether and how long it was lived in, let or used for business.
Tax regime
19% VAT or a 3/5/8% transfer fee.
Budget
The tax amount in the estimate before any deposit.
Contract
The tax regime is written into the contract.
05 / Key facts
What matters
01What it is
VAT rule
A building without 18 months of systematic use counts as new, even if the seller is not a developer.
02From
01.09.2026
Based on Orders 102/2026 and 103/2026.
03Tax difference
€57,000 vs €8,600
On €300,000: 19% VAT or a transfer fee with a 50% discount. A difference of €48,400.
04For PR
Option B commercial
Resale commercial property qualifies for PR, but if under 18 months of use, 19% VAT applies.
Common mistakes
Assuming any resale is VAT-free
If the building has been used for less than 18 months, 19% VAT applies. We check before any deposit.
Budgeting only for the transfer fee
On €300,000 the difference with VAT is €48,400. We calculate both.
Not stating the tax regime in the contract
Who pays which tax is fixed in the contract before signing.
06 / Expert advice
How to prepare in advance
Ask the seller for the building completion date and proof of how and for how long it has been used. Compare the price with 19% VAT and with the transfer fee.
What we do for you. We check the building's history before any deposit and calculate what you will pay: VAT or the transfer fee.
Igor VentsHead of real estate, Title Deed and property checks
07 / Questions
Frequently asked questions
A building without 18 months of systematic use counts as new for VAT.
From 01.09.2026, under Orders 102/2026 and 103/2026.
19% VAT, with no transfer fee.
A 3/5/8% transfer fee with a 50% discount instead of VAT.
On €300,000: €57,000 VAT versus a €8,600 transfer fee.
Resale commercial property is allowed under option B, and the rule decides which tax you pay.
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