Confirmed: PEPs to obtain Cypriot Citizenship through the Investment Program, despite previous refusals


The Cyrpiot Minister of Foreign Affairs, Nikos Christodoulides has confirmed that investors who are considered as politically exposed persons (‘PEPs’) can participate in the Cyprus Citizenship Investment Program (‘CIP’). He confirmed this during the meeting with representatives of the Cyprus Land and Building Developers Association (‘LBDA’).


LBDA representatives told Astons that every PEP willing to participate in the program will be subject to Anti-Money laundering checks. The Government also confirmed that investors whose applications were halted due to their PEP status can become Cyprot citizens. Their applications will be reviewed again, in accordance with Anti-Money Laundering regulations. 


Until now the decision to lift restrictions for PEPs was reported unofficially. Many experts say that this restriction, first introduced in 2019, was discriminatory towards law abiding investors who may have lost their ties to politics, or held non-important governmental positions. 


Proposal: Attractive investment terms 


LBDA representatives proposed to lower VAT payments for the purchase of properties until the end of December 2021 to 5%. The current tax rate is 19%.


Other proposed amendments for investors include the cancellation of capital gains tax (‘CGT’) on future property sales, and the possibility to return VAT for rented properties. Under these proposals, the tenants will pay that VAT. The Government agreed to respond later. 


Citizenship by Investment in Cyprus: changes amid pandemic 


The Government has also agreed to ease its citizenship by investment procedure. Firstly, it is possible to provide the necessary documents for this procedure, without apostille and submit apostilled versions at a later stage.


The Schegen visa also is not needed when applying, and can be obtained later. The Cypriot Government is investigating the possibility of receiving biometric data for CIP applicants through its embassies around the world.


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