Frequently Asked Questions

Unfortunately, no. Only TRNC citizens can establish a sole proprietorship in Northern Cyprus.

Individual income tax rates in Northern Cyprus are as follows:

• 10% for income between 0-30,000 TL
• 20% for income between 30,001-60,000 TL
• 25% for income between 60,001-136,000 TL
• 30% for income between 136,001-236,500 TL
• 37% for income of 236,501 TL and above

The Corporate Tax rate in Northern Cyprus is 10%. Apart from this tax, there is a 15% income tax. Income Tax is calculated on the net profit remaining after deducting Corporate Tax at the rate of 10%. Thus, the total rate of Corporate Tax and Income Tax is set at 23.5%.

In TRNC, 5 different VAT rates (0%, 5%, 10%, 16%, 20%) are applied depending on the type of service and product.

Yes, companies operating in free zones in Northern Cyprus are exempt from all taxes as long as they do not carry out trading activities in the country.

• Title Deed Transfer Fee: The title deed fee rate is 6% for TRNC and Turkish citizens and 12% for foreign nationals until December 31, 2023. This amount is paid by the buyer. However, if the buyer is not making the purchase for commercial purposes, they can pay this amount at a one-time 50% discount.
• Value Added Tax: VAT is set at 5%. This amount is paid by the buyer. VAT is not payable on second-hand house and land sales if the seller is not selling for profit.
• Withholding tax: This type of tax is paid by the seller. This rate is 4% if the seller is making a profit. If there is no profit motive in the sale, this amount is reduced to 2.8%. Non-profit sellers are exempt from this tax once in their lifetime.
• Stamp Stamp: If the sale is based on an unfinished project, the contract is registered with the land registry office. A 0.5% stamp fee is charged for this transaction, which formalizes the sale.

• For the company formation process, a trade name must first be chosen and an application must be made to the North Cyprus Companies Registry Office.
• Decide on the type of company and prepare the articles of association and bylaws accordingly.
• Forms GC1, GC2 and GC 3 must be completed and submitted to the North Cyprus Registry of Companies together with the company’s articles of association and bylaws.
• The necessary documents and application forms must be completed and the relevant fees must be paid.

• The company formation time usually ranges between 2-3 weeks.
• Costs may vary depending on the type of company, notary fees and other charges. Further information on average costs can be obtained from a local consultant.

• Yes, businesses in Northern Cyprus are required to keep annual accounting records and prepare financial statements.
• VAT, Withholding Tax and PAYE declarations must be submitted monthly and financial reports must be submitted annually.
• The preparation of tax returns is also part of this process and accounting services are provided by an accountant or accounting firm.

Businesses are subject to tax obligations such as income tax, corporate tax, VAT and various withholdings, including customs duties.

Foreign nationals can purchase one residential property per person or a maximum of 1 Cyprus acre (1338m2) of land in Northern Cyprus. Married couples are treated as one person, but if they have different surnames, they may be entitled to two separate properties. In addition, foreign nationals can buy an apartment or house in Northern Cyprus. Turkish citizens are entitled to buy 3 houses or apartments.