North Cyprus has cut property withholding tax on qualifying sales to foreign buyers from 20% to 10%; applications close on 5 January 2027.
Who Qualifies and What Is the Rate?
Under Article 6 of Decree Law 121/2026, made by the Council of Ministers (the TRNC cabinet) and in force since its publication in the Official Gazette (Resmi Gazete) on 6 October 2026 (Article 8), the Land Registry (Tapu ve Kadastro Dairesi) withholds tax at 10% on the average net profit when a person or company in the business of buying and selling, parcelling, or building and selling property disposes of it to a foreign individual or company under a transfer contract registered with it before 31 May 2024. The standard rate is 20% (Income Tax Law 24/1982, Article 31(1)(j)). The decree's title, Article 2 and Article 3 refer to 21 May 2024 instead. Applications go to the taxpayer's own Revenue and Tax Office branch until 5 January 2027 inclusive, and the whole tax is paid up front at the time of declaration (Articles 5(2) and 5(3)).
- Article 4(1): the person must have concluded a contract for the transfer of property within the borders of the TRNC, and the contract must be duly stamped under the Stamp Law (Pul Yasası).
- Article 4(2): the contract must have been registered and annotated (şerh) at the Land Registry before 31 May 2024, the date the amending Law 39/2024 to the Immovable Property Acquisition and Long-Term Lease (Foreigners) Law came into force.
- Article 4(3): tax for applicants is calculated under Article 6 on the amount, in Turkish lira and/or foreign currency, declared for the transfer.
- Article 4(4): the property must be transferred to a foreign individual or company through the contract registered at the Land Registry.
- Article 4(5): the transferor must have the status, under the Income Tax Law, of a person or company in the business of buying and selling, parcelling, or building and selling property.
What Changes Against the Standard Rule?
| ITEM | STANDARD RULE (24/1982) | UNDER 121/2026 |
|---|---|---|
| Withholding rate | 20% (Article 31(1)(j)) | Changed: 10% (Article 6) |
| Who withholds | The Land Registry, at the moment of disposal (Article 31(1)(j)) | Unchanged (Article 6) |
| Base | Net profit from the Article 4(5) activities, set by the average net profit ratio method; the ratio is 20% of the Land Registry market value or the sale price, whichever is higher (Articles 4(5) and 31(1)(j)) | Unchanged wording: average net profit from the Article 4(5) activities (Article 6) |
| New conditions (Article 4) | — | Duly stamped contract (4(1)); registered and annotated at the Land Registry before 31 May 2024 (4(2)); transfer to a foreign individual or company (4(4)) |
| Application (Articles 5(1) and 5(2)) | — | At the taxpayer's own Revenue and Tax Office branch, from entry into force until 5 January 2027 inclusive; in person or through an authorised representative, in one or more filings, within the deadline |
| Payment (Article 5(3)) | — | The whole tax, paid up front at the time of declaration |
| Loss of entitlement (Article 5(4)) | — | Those who do not pay up front the withholding assessed by the Revenue and Tax Office, and those who do not meet the decree's conditions, lose the benefit; the tax legislation in force then applies |
Who Needs to Act?
- For companies in property trading, parcelling or build-and-sell: check the stamping and the Land Registry registration and annotation date of every contract awaiting transfer to a foreign buyer; the whole tax is paid up front at the time of declaration (121/2026, Article 5(3)).
- For individuals in the same business: the decree applies to individuals on the same conditions (Articles 4(5) and 6); filings may be made in person or through an authorised representative, in one or more filings, within the deadline (Article 5(2)).
- In practice, the reduction reaches only transfers to foreign buyers under contracts meeting every Article 4 condition; a taxpayer who does not pay up front or breaches a condition falls back to the tax legislation in force, meaning the 20% withholding (Article 5(4); 24/1982, Article 31(1)(j)).
- Document that the contract is duly stamped under the Stamp Law (Article 4(1)).
- Establish the Land Registry registration and annotation date (Article 4(2)).
- Confirm the buyer is a foreign individual or company (Article 4(4)).
- Apply at your Revenue and Tax Office branch by 5 January 2027 inclusive (Articles 5(1) and 5(2)).
- Pay the whole tax up front at the time of declaration (Article 5(3)).
Please contact N.Akman & Co. to discuss whether your contracts qualify.
