Cyprus tax deductions 2026: children, rent, mortgage

Money and taxes in Cyprus Checked: 26 October 2026 Changed: 1 January 2026

In short

Who it applies to: Cyprus tax residents whose family income is within the limit: €100,000 for a family with no children or one or two, more for larger families, €40,000 for someone living alone. The deduction for insuring a home against natural disasters goes to any owner, with no income limit.
What it costs: Nothing — these are amounts taken off taxable income. Per child, each parent gets €1,000 for the first, €1,250 for the second, €1,500 for the third and each further one. Rent on your main home or mortgage interest on it — up to €2,000 per spouse. Insulation, solar panels, batteries, a new electric car — up to €1,000 a year each. Home insurance — up to €500.
How long it takes: The deductions apply from tax year 2026. There are two ways to claim them: in the 2026 return, filed in 2027, or right away — on form Τ.Φ.59 given to your employer, so that less tax is withheld from your salary.
Where to apply: The Tax Department (Τμήμα Φορολογίας) — through the return. There is no separate application: the amounts go into the return, and if you are employed, also into form Τ.Φ.59 for your employer, one figure per kind of deduction.
If your case differs: Spouses and couples with children in common have two conditions in common: both returns filed on time, and consent in each to share tax data — that is how the family income is checked. Without them, neither of the two gets the deductions.

Your case

If you are married, in a civil partnership, or live with the other parent of your children

The limit is based on both partners' gross income and depends on the number of children in the family: up to €100,000 with no children or one or two, €150,000 with three or four, €200,000 with five or more. Adult children and children of just one of you count too, as long as at least one child is still a dependant. Each biological or adoptive parent gets the child deduction separately — a step-parent does not. Rent or interest and energy upgrades — each of you within your own cap.

If you are raising a child on your own

The limits are the same as for a family, by number of children, and the deduction per dependant is doubled: €2,000 for the first, €2,500 for the second, €3,000 for the third. A single parent is one who lives alone with the child because they are unmarried, widowed or divorced (or the other parent has been declared missing by a court or is serving a prison sentence of 6 months or more) — as defined by the child benefit law (Επίδομα Τέκνου). If you live with a partner with whom you have a child, that is a family. Spouses who have separated but not divorced are not single parents under the law.

If you live without a spouse and without dependent children

The limit is €40,000 of your own gross income. Within it — up to €2,000 for rent on your main home or mortgage interest on it, and up to €1,000 for energy upgrades or a new electric car. The department also treats as single someone who shares a flat with a flatmate (FAQ, question 23): the flatmate's income does not count.

If your child lives with the other parent and you share parental responsibility

You are entitled to the child deduction, at the normal, not doubled, rate. The limit depends on whom you live with now: alone — €40,000; married with no other children in the home — €100,000; if other children live with you, yours together or your spouse's — the limit by their number (FAQ, question 27).

Deadlines and conditions

€1,000 for the first child, to each parentIncome Tax Law 118(Ι)/2002, art. 14Β(1)(α) as amended by Ν.244(Ι)/2025: «σε κάθε γονέα χίλια ευρώ (€1.000) για το πρώτο, χίλια διακόσια πενήντα ευρώ (€1.250) για το δεύτερο και χίλια πεντακόσια ευρώ (€1.500) για το τρίτο και για κάθε επιπρόσθετο εξαρτώμενο τέκνο».
€1,250 for the secondThe same art. 14Β(1)(α): €1,250 for the second dependent child.
€1,500 for the third and each further oneThe same art. 14Β(1)(α): €1,500 for the third and each further one. For single parents and for a parent with full custody the amount is doubled (proviso to the same paragraph).
family income up to €100,000 — no children or one or twoArt. 14Β(1)(α) and (β)(i): family income no higher than €100,000 if there are no children or up to two. Children are counted on 31 December of the tax year, all of them — adults and the children of one spouse too — as long as at least one dependent child remains in the family (FAQ, questions 19–22).
up to €150,000 — with three or four childrenArt. 14Β(1)(β)(ii): €150,000 if there are three or four children.
up to €200,000 — with five or more childrenArt. 14Β(1)(β)(iii): €200,000 if there are five or more children.
for someone living alone — income up to €40,000Art. 14Β(1)(γ): €40,000 for a «μονήρες πρόσωπο». The law (art. 14Β(3)(β)) defines this as a person who lives alone, is not married or in a civil partnership, does not live with other adults or dependants and is not a dependent child. The department's FAQ (question 23) reads it more broadly: someone sharing a home with other people also counts as single.
up to €2,000 each for rent or mortgage interestArt. 14Β(1)(β): «έως δύο χιλιάδες ευρώ (€2.000) σε κάθε σύζυγο ή σύμβιο ή μονήρες πρόσωπο» for interest on a performing loan to buy or build a main home in Cyprus, or for rent on a main home. FAQ, question 29: €2,000 is one cap for interest and rent together, not for each.

Show all conditions (14)

up to €1,000 a year each for energy upgrades or an electric carArt. 14Β(1)(γ): «έως χίλια ευρώ (€1.000) σε κάθε σύζυγο ή σύμβιο ή μονήρες πρόσωπο» for capital spending on the energy performance of the main home, renewable energy systems, batteries, and electric vehicles registered with the Road Transport Department. Public grants reduce the amount of spending.
the rest of the spending carries forward for 4 more yearsArt. 14Β(1)(γ), first proviso (i): spending not deducted because of the €1,000 cap «δύναται να μεταφέρεται και να χορηγείται ως έκπτωση κατά τα επόμενα τέσσερα (4) έτη». The guide (section 11): in a year when the income limit is exceeded, nothing is deducted and nothing is carried forward.
up to €500 for insuring a home against natural disastersArt. 9(1)(ζ)(ββ) of Law 118(Ι)/2002 as amended by Ν.244(Ι)/2025: «ποσό μέχρι πεντακόσια ευρώ (€500), για ασφάλιστρα … για την ασφάλιση κατοικίας έναντι κινδύνων φυσικών καταστροφών». FAQ, questions 42–46: per owner, for all homes and policies in the year, with no income limit, for any home — holiday or let; the policy may cover theft too.
a student counts as a dependant up to 24Art. 14Β(3)(δ): dependent children for the deduction include students «ηλικίας μέχρι είκοσι τεσσάρων (24) ετών». FAQ, question 25: a dependant is a child under 18, a secondary pupil under 20, a National Guard soldier under 21, a student under 24, or a child permanently unable to support themselves — on 31 December of the tax year.
the deductions apply from tax year 2026Ν.244(Ι)/2025, art. 25: the law is in force from 1 January 2026. The department's guide (section 1): the reform applies from tax year 2026, whose return is filed in 2027.
the electric car must be new: up to 6,000 kmThe guide (section 11) and FAQ (question 41): the deduction is only for a new category Μ1 electric car or a charging station; a car counts as new if delivered within 6 months of first registration or with up to 6,000 km — whichever comes first.

A deduction reduces taxable income, not the tax — and is lost entirely if family income is over the limit

What is most often missed:

€1,000 of deduction is not €1,000 less tax: the saving equals the rate of your top band, and if your taxable income already sits in the tax-free part, the deduction gives nothing
the limit is a cliff, not a scale: a family over it by even one euro gets neither the child, nor the housing, nor the energy deduction
income for the limit is gross and covers the whole family: both salaries, rent, interest, dividends, maintenance, benefits, income abroad; only earnings of children in education, child benefit, grants and disability allowances are left out
from 1 July 2026, rent counts only if paid by bank transfer, card or another electronic payment — cash and cheques do not
a grant for the same work is taken off the spending: on €10,000 of solar panels with a €4,000 subsidy, €6,000 is deductible
home insurance against natural disasters is the only deduction without an income limit, and it applies to any home, including one you let

What the deductions do not cover

interest on a loan for a home that is not your main one, or on a loan in arrears — a restructured loan counts if payments are made without gaps
interest if the home is not owned by you or your spouse and the loan is not in your name
energy upgrades to a rented home — the home must belong to you or your spouse
a used electric car — only a new category Μ1 electric car and a charging station
the child deduction for a step-parent — only for a biological or adoptive parent

If you share a rented home or live with a partner without marriage or children in common

The department treats you as single with a €40,000 limit on your own income (FAQ, question 23). The text of the law is narrower: single means not living with other adults. If the deduction matters to you, keep the department's answer to your question in writing.

If you have full custody of a child but have remarried

The law doubles the child deduction not only for single parents but also «when one of the two parents has full custody». The department's explanations do not cover this case — ask before putting the doubled amount on Τ.Φ.59 or in your return.

If you are buying an ordinary electric car

The department gives the deduction for a new category Μ1 electric car — an ordinary passenger car (FAQ, question 41). But the law refers to a list without Μ1: it names buses (Μ2, Μ3), lorries and vans (Ν), taxis and charging stations (art. 14Β(1)(γ) and the third proviso of art. 10(2) of the Income Tax Law). Until the law is amended, keep the department’s written answer to your question.

Sources

Ν.244(Ι)/2025 — amendment to the Income Tax Law (cylaw)www.cylaw.orgThe text of the law: new art. 14Β «Προσωπικές εκπτώσεις» (art. 10 of the amendment) — limits, amounts, conditions, definitions; the home insurance deduction in art. 9(1)(ζ)(ββ); entry into force on 01.01.2026 (art. 25).
Income Tax Law 118(Ι)/2002, consolidated text (cylaw)www.cylaw.orgThe current text of art. 14Β and art. 9(1)(ζ) including amendments up to Ν.67(Ι)/2026 — confirms the article was not changed after Ν.244.
Tax Department, explanatory guide to the tax reform for individuals (version of 11.05.2026)www.gov.cySections 5–12: which deductions, who counts as a family and a single parent, how income is counted, worked examples (five children, a single parent of three, separated parents, solar panels with a subsidy).
Tax Department, FAQ on the 2026 reform for individuals (version of 11.05.2026)www.gov.cyQuestions 8–46: Τ.Φ.59, spouses' consent, who is in the family and what income counts, who is single, separated parents, the rent and interest cap, cashless rent, the list of energy works, a new electric car, home insurance.
Tax Department, “Tax Reform 2026”www.gov.cyThe reform's collection page: guide, FAQ, examples, presentation, tax calculators.
Child Benefit Law 167(Ι)/2002, consolidated text (cylaw)www.cylaw.orgArt. 2: who is a single parent («μονογονεϊκή οικογένεια») and what family income is; art. 6: which income counts and which is left out.
Ν.243(Ι)/2025 — amendment to the Assessment and Collection of Taxes Law (cylaw)www.cylaw.orgNew art. 48Α (art. 29 of the amendment): rent is paid only by transfer, card or another electronic payment; in force from 01.07.2026 (art. 35(β)).
Form Τ.Φ.59 — deductions claim for the employer (Tax Department)www.gov.cyThe 2026 form: you give it to your employer every year; without it the employer grants no deductions. Lines Β3 (home insurance), Β10 (children), Β11 (rent or mortgage), Β12 (energy upgrade or electric car).