Cyprus's tax legislation provides substantial financial incentives for economically active individuals to relocate there, including a ‘non-domiciled’ regime which exempts dividend and interest income of individuals who are resident but not domiciled in Cyprus from all taxes, and exemptions of earned income for new taxpayers.

In July 2017, the Income Tax Law was amended to introduce a new route to tax residency for individuals with effect from 1 January 2017. Prior to the amendment, an individual needed to be physically present for at least 183 days in the tax year to be resident in Cyprus for the purposes of income tax.