On 18 May 2022, the government approved a tax deduction of 20% for legal entities and individuals investing in research, development and innovation, in a campaign to support the growth and competitiveness of Cyprus as a business and technology hub.

The tax deduction would be valid for three years, starting from tax year 2022. This is the second pillar of incentives followed by the incentives for headquartering being part of the scheme to attract foreign investments and businesses to Cyprus.

Following the recent geopolitical developments as well as other global factors, Cyprus has been experiencing an influx of high-tech and other companies which choose the island as a base for their operations or for relocating a part of those together with the respective human capital.

Cyprus is an emerging hi-tech jurisdiction, and such initiatives are likely to produce long term tangible results, assisting in both the island’s prosperity as well as that of the investors located here.