Property in Europe
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Cyprus has lost more than €1 billion in tax revenue due to the reduced 5% VAT rate, which was widely used by buyers of luxury villas rather than the families it was intended to support. Under pressure from Brussels, the Cypriot authorities have set a firm deadline: 31 December 2026 will be the final day to purchase property under the previous, highly favourable VAT rules.
The authorities intend to bring the rental sector fully out of the grey market by introducing strict regulations governing security deposits, rent increases, and lease termination procedures for both private property investors and tenants.
