Rent payments to be electronic starting 1 Temmuz

According to an announcement by the tax department in Kıbrıs, as of 1 Temmuz 2024, rent payments can no longer be made in cash. It has become mandatory for payments to be made via bank card, credit card, or other recognized electronic payment methods. This regulation applies to all real and legal persons on the island and will be valid regardless of the rent amount or the purpose of the property's use.

Under the new rule, no person or institution owning real estate in Kıbrıs will be able to accept rent in cash from their tenants. The tax department stated that this step was taken to reduce the informal economy and facilitate tax audits. The electronic payment obligation will apply to both residential and commercial properties.

The regulation has caused some concern, particularly among small homeowners and elderly tenants. However, officials reminded that there are various electronic options such as bank transfers, standing order instructions, and digital wallets, and announced that guidance services will be provided to ensure a smooth compliance process.

Kıbrıs Vergi Dairesi emphasized that this decision is in line with the European Union's anti-money laundering directives. Additionally, it is considered an important step in preventing tax evasion due to the difficulty of tracking cash payments. It was noted that similar regulations have started to be implemented in other EU countries.

By 1 Temmuz, when the implementation will begin, landlords and tenants need to review their existing lease agreements and adapt their payment methods to the electronic system. The tax department announced that administrative fines are foreseen for those who do not comply with the rules, but that information and warnings will be prioritized in the initial stage.