Cyprus Crypto Tax Guide 2026
Cyprus does not have specific cryptocurrency tax legislation. The Tax Department treats crypto assets on a case-by-case basis. Generally, gains from crypto classified as securities benefit from 0% CGT, while gains from crypto traded as a business or professional activity are taxed as income at progressive rates (0–35% for individuals, 12.5% for companies).
The tax treatment of cryptocurrency in Cyprus follows general tax principles applied by the Tax Department of Cyprus. For related guidance, see our Capital Gains Guide → and Investment Income Guide →.
Classification of Crypto Assets
The Tax Department of Cyprus evaluates crypto transactions based on the specific facts and circumstances. The classification determines the tax treatment:
- Investment asset (capital): If crypto is held as an investment (like shares), gains may qualify as capital gains. Gains on securities/shares are 0% under Cyprus CGT rules. However, the Tax Department has not issued clear guidance confirming that crypto qualifies as securities for CGT purposes.
- Business income: If crypto trading is conducted as a business (frequent trading, professional activity, mining as a business), gains are treated as business income and taxed at standard rates (0–35% for individuals, 12.5% for companies)
- Employment income: Crypto received as salary or remuneration is treated as employment income and subject to PAYE at progressive rates plus social contributions
- Mining and staking: Generally treated as income at the time of receipt, valued at fair market value
SDC and GHS Implications
- SDC: Crypto gains are not currently treated as dividends, interest, or rental income, so SDC generally does not apply
- GHS (GesY): If crypto income is classified as business or employment income, GHS contributions at 2.65% (employee) + 2.9% (employer) may apply
Record Keeping and Reporting
Taxpayers engaged in crypto transactions should maintain detailed records including:
- Date and time of each transaction
- Type and amount of crypto, fiat value at transaction time
- Wallet addresses and exchange platforms used
- Transaction fees and other costs
- Purpose of the transaction (investment, business, personal)
Crypto gains or income must be declared in the annual tax return through Taxisnet. Failure to declare may result in penalties and interest.
EU Regulatory Context
As an EU member state, Cyprus is implementing the Markets in Crypto-Assets (MiCA) regulation, which will provide a comprehensive regulatory framework for crypto assets. MiCA will bring greater clarity to the tax treatment of crypto and may influence future Tax Department guidance. The Crypto-Asset Reporting Framework (CARF) developed by the OECD is also expected to be adopted, requiring automatic exchange of crypto transaction information between tax authorities.