Is there inheritance tax in Cyprus?

Cyprus abolished inheritance tax and estate duty with effect from 1 January 2000. There is currently no inheritance tax, gift tax, or estate duty in Cyprus. Assets passing on death or by way of gift are not subject to any Cyprus-side inheritance or gift tax charge, regardless of whether the assets are located in Cyprus or elsewhere, and regardless of the nationality or residence of the deceased or donor. This is the correct answer to the Cyprus question. It is not necessarily the complete answer for a person whose nationality or domicile of origin connects them to another jurisdiction with inheritance or gift tax rules of its own.

Are Greek nationals living in Cyprus subject to Greek inheritance tax on their foreign assets?

Greek inheritance and gift tax is governed by Law 2961/2001, as amended. The law does not limit its reach to assets located in Greece or to persons who are Greek tax residents. For Greek nationals, movable assets located outside Greece — including shares in foreign holding companies, investment portfolios held outside Greece, and other movable property — are within the scope of Greek inheritance and gift tax. A Greek national who lives in Cyprus and holds assets through a Cypriot structure is not automatically outside the Greek tax net. The applicable exemptions depend on how long the individual has been established outside Greece and whether they have subsequently returned. Specialist Greek tax advice is required to assess the specific position.

What are the Greek gift tax exemptions for Greek nationals living abroad?

Under Greek Law 2961/2001, as amended by Law 4887/2022, Greek nationals established outside Greece for at least 10 consecutive years benefit from an exemption on gifts of movable assets located abroad. If they subsequently return to Greece, the exemption continues to apply provided no more than 5 years have passed since the return, unless the tax authority establishes that the relevant assets were acquired in Greece within the preceding 12 years. Greek nationals established outside Greece for at least 20 consecutive years who have not returned to Greece at the time of the gift benefit from a more complete exemption on foreign movable assets. These thresholds apply to gift and parental provision tax. Inheritance-on-death may be governed by different or additional provisions, and specialist Greek tax advice is required for both the lifetime and death scenarios.

Does the Cyprus holding structure protect a Greek national from Greek inheritance tax?

A Cyprus holding structure interposes a Cyprus company between the Greek national and the underlying assets. The underlying assets may include investments, real estate, operating companies, or other property. The structure itself is legitimate and creates a real legal separation from the underlying assets. However, the shares in the Cyprus holding company are themselves movable assets belonging to a Greek national. They are located outside Greece. Greek law's reach to the movable assets of a Greek national applies to those shares in the same way it applies to any other movable asset held outside Greece. The structure addresses many planning objectives effectively. It does not, of itself, resolve the Greek gift and inheritance tax dimension for a Greek national who has not yet met the statutory time thresholds.

Cyprus Has No Inheritance Tax. That Is Not the Complete Answer.

A Greek national living in Cyprus asked his advisers what the inheritance tax position would be when he passed. He held wealth through a Cyprus holding structure and an investment portfolio in his own name. Two professionals, a lawyer and an accountant, gave him the same answer: there is no inheritance tax in Cyprus. That answer was correct. It was also incomplete, and the gap between those two things is where planning failures are made.

When the question was put to a third adviser, the response was different: the Cyprus position is correct, but you should ask a Greek tax lawyer the same question. That suggestion was initially resisted. The client had already asked two professionals. He had his answer. He eventually made the call. What he learned was that the conversation had been conducted entirely on the wrong side of the border.

The answer everyone gives: and why it is correct

Cyprus abolished inheritance tax and estate duty with effect from 1 January 2000. There is no inheritance tax, no gift tax, no estate duty in Cyprus. Assets passing on death or by way of gift do not attract any Cyprus-side charge, regardless of where those assets are located, regardless of the nationality of the deceased or donor, and regardless of how long they have been resident in Cyprus. The lawyers and accountants who confirmed there is no inheritance tax in Cyprus gave an accurate answer to the question they were asked.

The problem was not the answer. The problem was the question. The question that was asked was: what does Cyprus charge? The question that needed to be asked was: is Cyprus the only jurisdiction with a view on this?

What Greek law actually says: and who it follows

Greek inheritance and gift tax is governed by Law 2961/2001, as amended. This law does not limit its scope to assets located in Greece, and it does not limit its scope to persons who are Greek tax residents. It follows Greek nationals. For a Greek national, movable assets located outside Greece (shares in a foreign holding company, an investment portfolio held in a Cyprus or other foreign bank account, other movable property held abroad) fall within the scope of Greek gift and inheritance tax.

This is the point that most Cyprus-based advisers do not reach. A Greek national who moves to Cyprus and establishes tax residency here has changed where they live and where they pay income tax. They have not, by that act alone, changed what Greek law says about their movable assets when those assets are transferred on death or by way of gift. The two questions are governed by different legal frameworks. Changing your tax residency answers one of them. It does not answer the other.

The immovable assets question is more intuitive: Greek property is taxed in Greece. Most people already understand this. The movable assets question is where the assumption fails. It is natural to assume that assets held outside Greece, through a structure incorporated outside Greece, by a person who no longer lives in Greece, are outside Greece’s tax reach. Under Greek Law 2961/2001, for movable assets belonging to a Greek national, that assumption is wrong until the statutory conditions that override it have been met.

The Cyprus structure: and what it does not resolve

A Cyprus holding company interposes a legal entity between the Greek national and the underlying assets. The underlying assets (investments, participations, real estate held through the structure, other property) are owned by the Cyprus company, not directly by the individual. This is a legitimate and effective planning structure for many purposes: administrative consolidation, succession planning at the level of company shares rather than underlying assets, potential treaty benefits, and others.

But the shares in the Cyprus holding company are themselves movable assets. They belong to the Greek national. They are located outside Greece. Greek law’s reach to movable assets of a Greek national applies to those shares in the same way it applies to any other movable asset held outside Greece. The structure is sound. It does not, of itself, resolve the Greek dimension of the question. It relocates the question from the level of the underlying assets to the level of the shares, but the question remains.

The investment portfolio held in the individual’s own name is a more direct case. There is no interposed structure. Movable assets belonging to a Greek national, held outside Greece. The Greek law position applies without an additional analytical step.

The exemptions: and what they require

Greek law does provide exemptions, and they are material. Under Law 2961/2001, as amended by Law 4887/2022, a Greek national who has been established outside Greece for at least 10 consecutive years benefits from an exemption on gifts and parental provisions of movable assets located abroad. If that person subsequently returns to Greece, the exemption continues to apply for a period, subject to conditions. A Greek national established outside Greece for at least 20 consecutive years who has not returned to Greece at the time of the gift benefits from a more complete exemption on foreign movable assets.

These thresholds are specific to the gift and parental provision provisions of the law. Inheritance on death may engage different or additional rules, and the interaction between the thresholds and the specific facts of any individual case requires proper legal analysis. What they share is the same underlying logic: the exemption is not automatic. It is earned through time. Until the relevant threshold has been met, the Greek tax net potentially applies.

A Greek national who moved to Cyprus three years ago has not yet met the 10-year threshold. Five years: not yet. Seven years: not yet. The planning conversation about inheritance and gifting needs to be had now, not deferred until the threshold is comfortably met, because the structuring decisions made before the threshold is reached will determine what exposure exists and whether it can be addressed. Deferring the conversation does not defer the exposure.

The principle that extends beyond Greece

Greece is one example of a jurisdiction whose gift and inheritance tax follows the nationality of the donor or deceased, not only the location of the assets or the current residence of the owner. The UK operates on comparable logic through its domicile rules: a person with a UK domicile of origin remains subject to UK inheritance tax on their worldwide assets even after leaving the UK, until they have acquired a domicile of choice elsewhere and the extended charge period has run. Several other European jurisdictions apply similar approaches, tying succession tax liability to citizenship or domicile of origin rather than current residence.

The pattern is the same in each case. The country of origin does not automatically release its claim on what a person leaves behind simply because that person has moved. The new country of residence may have zero inheritance tax. The country of origin may not, and its rules may continue to apply regardless of where the person now lives, how long they have lived there, or how their assets are structured. No planning can be done on the Cyprus side alone when the person in question retains a legal connection to another jurisdiction that gives that jurisdiction a claim on their estate.

The question is not what Cyprus charges when you pass. It is whether Cyprus is the only jurisdiction with a view on the matter.

What the complete conversation looks like

A Greek national living in Cyprus who is thinking seriously about inheritance and succession planning needs an answer assembled from both sides of the border. The Cyprus adviser can confirm the Cyprus position: no inheritance tax, no gift tax, no estate duty. That part is settled. What the Cyprus adviser cannot do is assess the Greek position, apply the current provisions of Law 2961/2001 to the specific facts, determine whether the applicable thresholds have been met, and advise on what structuring, if any, should be considered before they are. That requires a Greek tax lawyer.

The two conversations are not alternatives. They are sequential. The Cyprus adviser identifies that the question has a Greek dimension. The Greek tax lawyer assesses what that dimension means for the specific individual, their assets, their timeline, and their intentions. The adviser who coordinated the planning understands both answers and ensures they are reflected in whatever structure or arrangement is put in place.

What the client in this case received from two separate Cyprus professionals was a correct and consistent answer to a question that was, on its own, insufficient. The adviser who suggested involving a Greek tax lawyer did not know the Greek law position. What they knew was that the question being asked did not have only a Cypriot answer. That recognition, that a question whose surface is Cyprus may have a floor in another jurisdiction, is where the value of properly multidisciplinary advice lies.

Cyprus has noinheritance tax.That is not the complete answer.