Greece vs Cyprus: Non-Dom Tax Regimes Explained

Written by Nikos Manousakis, Mediterranean Tax Advisor & Partner at Aegean Cross-Border Solutions. Opinions are my own—not legal advice.

Moving to the sun-kissed eastern edge of Europe no longer means surrendering half your income to the taxman. Both Greece and Cyprus court foreign talent and capital with headline-grabbing “non-dom” regimes. But the devil, as always, hides in the footnotes.

After two decades helping clients split their lives between Athens, Limassol and everywhere in-between, I’ve distilled the most important differences into one no-fluff, human-sounding guide. We’ll cover:

1. Flat tax vs remittance basis
2. Residency requirements
3. Foreign income exemptions (and hidden trip-wires)
4. Which regime suits retirees, investors, start-ups and location-independent founders

Feel free to skim to the section that matters—or nerd out on the whole 3,000-word opus.

“The cost of sunburn is a €200 dermatologist bill. The cost of ignoring cross-border tax rules could be your retirement.”
—My favourite line when a client tells me paperwork is boring.

1. The Big Philosophy Split: Flat Tax vs Remittance Basis

Greece: A Simple-Sounding Flat Tax

Greece’s flagship non-dom option is article 5A of the Income Tax Code—a €100,000 annual flat tax on all foreign-source income. Pay it, and your dividends from Delaware, rental income from Berlin and crypto gains from anywhere stay off the Greek radar. You can also extend coverage to family members for an extra €20,000 each.

Pros - Predictable liability: €100k is €100k, whether you earn €300k or €30m abroad. - 15-year certainty, renewable annually (though planning for years 16+ matters).

Cons - Good only if your foreign income is high. A retiree on €60k passive income will overpay. - Local Greek income—say you buy an Airbnb in Thessaloniki—is taxed normally, up to 44%.

Cyprus: The Remittance Basis Reborn

Cyprus doesn’t impose a fixed “membership fee.” Instead, non-dom individuals pay zero tax on foreign-source dividends, interest and most capital gains—provided those profits stay offshore. If remitted (brought into Cyprus), they still escape tax thanks to an exemption from the Defence Contribution for 17 years.

Pros
- Zero means zero; great for dividend-heavy founders or ETF investors.
- No minimum contribution. Whether you earn €30k or €3m, foreign dividends = 0%.
- Capital gains outside Cypriot real estate are untaxed.

Cons
- Foreign employment income is taxable if you physically work for that foreign company while sitting in Cyprus. (More on the 50% expat deduction later.)
- The 17-year clock is generous but not eternal.
- Laws require occasional tweaks to align with EU directives—uncertainty risk is non-zero.

Quick Cheat-Sheet

2. Residency Requirements: 183 Days vs the Famous 60-Day Rule

Greece: Classic 183-Day Threshold

To activate 5A status you must become a Greek tax resident, defined as: - Spending at least 183 days in Greece OR - Having the “centre of vital interests” there (family, property, business).

There’s no part-time loophole; you’ll file a return, register utilities, arguably join the local pharmacy loyalty program—you get the gist.

The upside? It pairs nicely with the Greek Golden Visa: New Rules 2024 if you want residency through property.

Cyprus: The Flexible 60-Day Rule

Cyprus re-engineered its residency test in 2017:

You qualify if you
1. Spend ≥60 days in Cyprus, and
2. Spend <183 days in any other single country, and
3. Maintain a permanent home (owned or rented) and either:
- Have business or employment in Cyprus or
- Directly/indirectly hold shares in a Cypriot company.

Result: A semi-nomadic founder can tick the boxes with a two-month beachfront stint, then wander the planet the rest of the year—without triggering residency elsewhere. BorderPilot users routinely build “triangle calendars” to thread this needle.

Call-out: The 60-day rule sounds like a dream but is fragile. If HMRC, the IRS or the ATO grabs you for residency, Cyprus will not save you from a double-tax punch.

3. Foreign Income Exemptions & Trip-Wires

Dividends & Interest

• Greece: Covered by the €100k envelope. No separate withholding.
• Cyprus: 0% Defence Contribution for non-doms. Banks may ask for a non-dom certificate—keep it handy.

Capital Gains

• Greece: Outside the flat tax; foreign gains ignored after you pay the €100k. Local stock gains taxed 15%.
• Cyprus: Zero on foreign capital gains. Local real estate gains taxed 20%.

Pensions

• Greece offers a 7% flat tax on foreign pensions for 15 years—separate from the €100k scheme but cannot be combined.
• Cyprus: Foreign pensions can elect a flat 5% tax on amounts above €3,420 annually.

Employment Income

• Greece: Salary from a foreign company is off the grid only if invoiced from abroad and not connected to a Greek permanent establishment. In practice, remote employees may trip permanent establishment rules; founders fare better.
• Cyprus: If you physically perform duties in Cyprus, income is taxable—BUT the 50% exemption applies if salary ≥€55,000 and you were non-resident the previous 10 years. Effective rate can drop below 10%.

Wealth & Inheritance

Neither country levies a net wealth tax. Inheritance/gift rules diverge: - Greece: Gift tax 0–10% for immediate family, can be mitigated via holding companies.
- Cyprus: No inheritance or gift tax since 2000—an underrated perk for family offices.

4. Additional Perks & Headaches

Social Security

• Greece: Individuals under 65 pay public health contributions; entrepreneurs must join EFKA.
• Cyprus: Non-dom employees contribute 8.3% to social insurance up to €60k salary. Self-employed pay 15.6% on imputed income brackets.

Double-Tax Treaties

Both jurisdictions punch above their weight: - Greece: 57 treaties, strong with USA, Germany, UK.
- Cyprus: 65+, incl. newcomer agreements with Spain and the Netherlands. Crucial for royalty and interest routing.

Corporate Structures

• Greek IKE vs Cypriot LTD
  • Greece: 22% corporate tax, dividends 5% (2024).
  • Cyprus: 12.5% corporate tax, dividend withholding 0%.

Entrepreneurs often use a Cypriot HoldCo + personal non-dom status to draw zero-tax dividends, reinvesting retained earnings globally.

5. Case Studies: Who Wins Where?

(Names changed; real files from my drawer.)

5.1. Retired Airline Captain With €80k Annual Pension

• Concerns: Predictable tax, medical coverage, EU lifestyle.
• Greece’s 7% pension regime beats paying the €100k flat. Total tax ≈ €5,600.
• Cyprus charges 5% above €3,420 → roughly €3,820 tax.
  Verdict: Cyprus edges out, though healthcare coverage requires private insurance.

5.2. SaaS Founder Pulling €1.2m Dividends + Occasional Stock Sales

• Needs: Low dividend tax, investor-friendly jurisdiction, English-speaking legal service.
• Greece flat tax = €100k (8.3% effective). Stock sales: shielded.
• Cyprus: 0% dividend tax; capital gains 0%.
  Even after €20k of specialist fees, Cyprus wins. Bonus: 60-day residency fits conference schedule.

5.3. Digital Nomad Couple Earning €140k Remote Salaries

• Considering DNV visas after reading our Portugal vs Greece comparison.
• Greece: Salaries are foreign income, but permanent establishment risk triggers local tax up to 44%. Ouch.
• Cyprus: Taxable, but 50% exemption drops effective rate to ≈11%.
  Verdict: Cyprus—unless they pivot into pensioners overnight.

5.4. High-Net-Worth Family Office, €4m Passive Income

• Greece: €100k on €4m → 2.5% effective rate.
• Cyprus: 0%; need asset-protection structure, maybe a DAC.
  If asset growth >5%, Cyprus’s zero CGT compounds value.
  Verdict: Tie→Leaning Cyprus unless family wants Athens culture year-round.

6. Evaluating Lifestyle, Banking & Bureaucracy

Personal anecdote: My Athens accountant filed my Cypriot VAT one year because DHL delayed a stamp apostille—a cross-border comedy of errors that would never happen if I’d stuck to one jurisdiction. Multijurisdiction living is glamorous until you’re hunting blue-ink signatures in July.

7. Practical Steps to Enrol

Greece Non-Dom Checklist

1. Prove non-Greek tax residence last 7 of 8 years.
2. Show an investment ≥€500k in real estate, securities, or shares within 3 years.
3. File application by 31 March of the tax year.
4. Pay first €100k by end of July.

Cyprus Non-Dom Checklist

1. Obtain residence permit (work contract, self-employment or investment).
2. Pass 60-day test; secure local address.
3. File form TD38 to the Tax Department.
4. Request non-dom certificate for banks.

BorderPilot’s “Non-Dom Wizard” auto-generates a Gantt chart of these steps, including the bank holidays when no notary in Limassol will answer your call. Saves hair-pulling.

8. Red Flags & Future Proofing

1. EU Anti-Tax Avoidance Directives could limit mismatch benefits (hybrid entities, CFC rules).
2. Greece occasionally toys with raising the flat tax—budget discussions worth monitoring.
3. Cyprus must keep Brussels happy after the “golden passport” saga; due diligence is stricter.

Smart expats hold Plan B residency (e.g., Italy or Malta) and diversify holding structures.

9. Verdict: Who Should Choose What?

• Retirees with pensions under €100k → Cyprus 5% regime.
• Ultra-high-income investors → Cyprus for zero dividend/CGT; Greece acceptable if you crave predictable €100k and unlimited wine regions.
• Remote employees under €100k salary → Neither; explore Portugal’s NHR successor or a territorial tax island.
• Entrepreneurs scaling fast → Cyprus LTD + non-dom, but budget for real substance to keep tax authorities smiling.
• Culture vultures, slow travellers → Greece’s 183-day immersion, world-class islands and feta, at a tax premium you may gladly pay.

“Tax is not just percentages; it’s where your kids learn to swim, the coffee you drink at 7 a.m., and the lawyer you call at midnight.”
– Yes, I actually said that to a client. They moved anyway.

Ready to crunch your numbers?

BorderPilot blends real-time tax legislation, treaty analysis and cost-of-living data to deliver a personalised relocation blueprint in minutes. Start your free relocation plan today and see whether Greece or Cyprus—or somewhere entirely different—makes financial and lifestyle sense for you.