If you sign a long-term tenancy agreement in Cyprus, you may need to consider whether you need to have it stamped. This may be because it is required by the Cyprus Tax Department, if you need to use the tenancy agreement as evidence in court, or if it needs to be notarised for a public authority or organisation to accept it. The processes for stamping or notarising documents are fairly simple and carrying them out can save a lot of future headaches. We have made it even easier for you through this informational guide.
There are two types of stamps discussed in this blog, with each being necessary for distinct purposes.
For Tenants - Notarisation
As a first step tenants need to ensure that they have a valid written rental agreement. The effective date of the rental agreement must be clearly visible on the document and the document must be signed by both parties to the contract (please note that two witnesses would be required for the signatures if the tenancy exceeds 12 months). Keep in mind that the notarisation process has nothing to do with the content of the agreement, the job of the certifying officer is simply to certify the signatures of the parties that sign the agreement.
After ensuring that you have a valid rental agreement, you need to take an original copy to a certifying officer to sign it in his presence, or acknowledge that the signature is yours so that the certifying officer can perform its notarial act. The Law on Authenticators of 2012 N (165 (I) / 2012) establishes that Cypriot certifying officers (also known as Public Notaries) are in charge of authenticating signatures and seals on documents. These officers are nominated by the Ministry of Interior and have the authority to authenticate a large variety of documents. The cost of this procedure according to section 10 of the law is only €2 (the amount may be increased to €5 if the verification takes place outside the head office). It should also be noted that the heads of local communities (mukhtars) in Cyprus can also carry out this function.
Certifying officer stamp example:
For Landlords or Tenants – Stamp Duty
Not many people know this, but in order for your tenancy agreement to be submitted as evidence in court (e.g. when a breach of contract happens), the tenancy agreement needs to be stamped by the Cyprus Tax Department. The Stamp Duty Law (19/1963) requires the payment of a one-off fee in the form of stamp duty to the Cyprus Tax Department for specific types of agreements, which includes tenancy agreements. This is usually an obligation for the tenant, however, the landlord can also complete this requirement. The law states that, in relation to tenancy agreements, the stamp duty paid for agreements at the value of €0 to €5000 is €0, however, for every €1000 (or part of €1000, e.g. €999) after that, a charge of €1.50 is added. For example, if you have an average tenancy agreement for a term of 1 year, which has a monthly rent of €500, a stamp duty of €1.50 (as the total value of the agreement would be €6,000 for 12 months) would be applicable. The Cyprus Tax Department has also published a tool that calculates a document’s stamp duty here: https://www.mof.gov.cy/mof/tax/taxdep.nsf/All/1E2FBA79B3A6DDA9C22585AD003AD8B6?OpenDocument.
It should be also noted that fines are applicable where stamp duty is not paid. The relevant fines are 1x the stamp duty fee if a person does not pay within 30 days of the first signature, and 2x the stamp duty fee if not paid within 6 months. Also, if a tenancy agreement has not been stamped within the appropriate time frame, and either the tenant or landlord intends to use it in court, the stamping can be done even at this stage, but the relevant fines would need to be paid.
Paying the stamp duty and having a tenancy agreement stamped can be particularly beneficial for tenants who intend to submit the tenancy agreement for yellow slip applications or other types of immigration applications, which sometimes have this as a requirement.
From July 2020, a new process was introduced for paying stamp duty, which also created the aforementioned stamp duty calculation tool. For stamp duty which is below €100, which covers almost all of the tenancy agreements in Cyprus, they will be required to
1. use the calculation tool,
2. send an email to the Cyprus Tax Department with the tool’s outcome calculation,
3. purchase the stamps from the authorised representatives that can sell them, not from the offices of the CyprusTax Department. (those of 2021-2022 can be found at the bottom of the page here: https://enimerosi.moec.gov.cy/archeia/1/ypp12972a.
4. affix the stamp on the document, and
5. draw two diagonal lines in the shape of an X over the stamp to cancel, write the date of cancellation, and sign. (the cancellation of the stamp is required in order to ensure that the stamp will not be reused)
The process is outlined by the tax department here.
Are you a landlord who wants a comprehensive tenancy agreement? Then find out more about Efkolaw’s customizable tenancy agreement template here.
Please note that Efkolaw is not a law firm and it does not offer any legal advice. Any content hosted on our site is meant to be informative and does not constitute or substitute advice from a qualified legal professional.