Filenews 20 January 2026 - by Eleftheria Paizanou
The double winners will be the "talents" who work abroad and will move to Cyprus to work under the "Minds in Cyprus" incentive scheme, as they will benefit both from the generous special tax exemptions, which can reach 25% of their remuneration with a maximum amount of €25,000, and from the tax deductions offered by the tax reform for all taxpayers.
The deductions concern the composition of the family, the number of children, rents, mortgage interest, the increase in tax-free income, tax scales, etc.
The double benefit for these persons particularly alienated the members of the Parliamentary Committee on Finance, who believe that the gap in benefits that this category of workers will receive is widening too much, at the expense of the workers who are already in Cyprus.
In addition, reservations were expressed, as some workers who came to the island through the two previous similar plans will have fewer benefits than those granted to employees who will henceforth use the "Minds in Cyprus" plan.
In fact, what emerged from yesterday's debate in Parliament is the fact that in the end the plan is not only aimed at talents, in the strict sense of the term, as was its original purpose, but it will be able to be used by anyone who works abroad, regardless of whether they have a university degree, provided that they were out of Cyprus for seven years and at some point in their life they were on the island for a year.
A typical case is given by the MPs, who argued that someone who worked for a few years as a waiter in a restaurant in England, provided that at some point he was in Cyprus as a tax resident, regardless of whether he had income, will be able to take advantage of tax incentives and benefit from the large deductions from his income.
The concerns of the parties
DISY MP Savia Orfanidou spoke of two-speed workers.
AKEL MP Andreas Kafkalias stated that these are tax incentives for which there has been no prior assessment and evaluation of the existing legislative framework, the social impact and the tax reform.
DIPA MP Alekos Tryfonidis called on the Government to provide the right incentives to the workers who are already on the island.
The spokeswoman for the Ministry of Finance said that the current plan provides that an employee who works for three consecutive years outside the Republic is subject to a 20% tax exemption on income tax in the Republic, with a maximum deduction amount of €8,550. As he said, today the tax exemption is valid for a period of seven years and ends in 2027.
In relation to the new plan and the revised provisions of the bill, the percentage of income tax deduction for employment in Cyprus will amount to 25%, with a maximum amount of €25 thousand. He said that a condition for someone to receive the discounts is to be outside the Republic, adding that if the person claiming the exemption is a holder of a recognized degree, he should have three years of work abroad, while if he does not hold a recognized degree, he should work abroad for seven years.
In relation to the 50% tax exemption, he said that the person should be outside the Republic for 15 years, provided that his remuneration from employment exceeds €55,000 per year.
600 new applications from interested parties
At the same time, 600 employees have submitted an application to the "Minds in Cyprus" platform to use the new plan, with the president of the Finance Committee Christiana Erotokritou calling on the ministry to outline the profile of the applicants.
On behalf of the ministry, Naya Symeonidou stated that in 2024 the state had revenues of €120 million through the plan. It is recalled that from 2021 to 2024, employees who came to Cyprus through such plans claimed tax exemptions of €2 billion.
What lawyers and accountants said
On behalf of the Cyprus Bar Association, Maria Grigoriou stated that the plan has retroactive effect from January 1, 2025, pointing out that with this provision, employees who came to Cyprus last year will also benefit. As he said, with the tax reform, many facts have changed, as employees will also benefit from the discounts provided for in the new legal framework.
A representative of ICPAC noted that the plan is an additional tax incentive. "Always in cases of such incentives there is a question of whether it is fair or not. Some will benefit, some will not. You can't set criteria that satisfy everyone," he concluded.
