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PKF Cyprus

A member of PKF International. A global family of legally independent firms.

Cyprus National Health Insurance System (NHIS)

Cyprus National Health Insurance System (NHIS) is a modern and integrated health insurance system for Cypriot citizens

Who is under the Cyprus National Health Insurance System (NHIS)

All citizens who have their residence in areas controlled by the Government of Cyprus and fall into one of the following categories:

When will the Cyprus National Health Insurance System (NHIS) be implemented?

The NHIS will be implemented in two phases:

  • June 2019 – Application of Outpatient Care
  • June 2020 – Complete implementation of NHIS with the introduction of In-patient Health Care Services,

Who are obliged to pay contributions to the Cyprus National Health Insurance System (NHIS)

Natural persons who receive income both in and outside the Republic of Cyprus are required to pay contributions. The following are required to pay to the Cyprus National Health Insurance System (NHIS):

  • Employees (including benefits in kind)
  • Employers
  • The State
  • Self-employed
  • Retired
  • Individuals who receive income from interest, dividends, rents, intellectual property rights, benefits in kind, interest on director’s / shareholder’s balances, pursuance of profession in Cyprus like musicals, other relevant income etc.
  • Officials (persons holding a state or municipal office)
  • Other persons not resident in the Republic of Cyprus who receive income from the Republic of Cyprus (subject to conditions)

How Cyprus National Health Insurance System (NHIS) payments are calculated

Contribution Percentages 1st Phase Percentages Full adoption Percentages
Employees 1,70% 2,65%
Employers (and the State as employer) 1,80% 2,90%
State 1,65% 4,70%
Self Employed 2,55% 4,00%
Retired 1,70% 2,65%
Individuals who receive income,  interest, dividends, rents, etc. 1,70% 2,65%
Officials (persons holding a state or municipal office) 1,85% 2,65%

The contribution amount in the Cyprus National Health Insurance System (NHIS) is calculated by a percentage of the total remuneration of each individual, with a maximum sum of remuneration of 180,000 Euros per year.

When is the first starting date for contributing to the Cyprus National Health Insurance System (NHIS)?

The first starting date for contributing to the NHIS is March 1, 2019

Which departments in Cyprus are responsible for the collection of  contributions?

The collection of contributions is made by:

  1. The Social Insurance Services department of Cyprus,
  2. The Cyprus Tax Department;
  3. The Treasury of the Republic of Cyprus.

In practice, how the Cyprus National Health Insurance System (NHIS) cuts are made on dividends

As of March 1, 2019 both actual and deemed dividends are subject to Cyprus National Health Insurance System (NHIS) and the payment is made on which it is declared first.

It is worth noting that there is a significant benefit for Cypriot citizens and individuals who have their permanent residence in Cyprus to distribute dividends by February 28, 2019. Where dividend taxes arise, they will have to be settled in the month following the date the dividends are declared. That is until 31 March 2019.

In practice, how are the Cyprus National Health Insurance System (NHIS) cuts are paid on salaries and rental income

The relevant forms must be completed and submitted together with the relevant payment.

Employees

  • For March and onward, completion of revised I.R. 59 by taking into consideration NHIS cut.
  • Together with the calculation of the monthly PAYE, preparation of relevant Cyprus National Health Insurance System (NHIS) form and payment of the relevant amount via the JCC website.

Rentals received by natural persons

  • Payable together with the form when paying special defense contribution on dividends (I.R. 601)

It is expected that more practical guidance will be provided with regards to deduction and payment of the above contributions to NHIS

Contact us:

For additional information please contact us:

E-mail address: [email protected]

Telephone + 357 22 462727

March 2019

 

The authors expressly disclaim all and any liability and responsibility to any person, entity or corporation who acts or fails to act as a consequence of any reliance upon the whole or any part of the contents of this publication.

Accordingly no person, entity or corporation should act or rely upon any matter or information as contained or implied within this publication without first obtaining advice from an appropriately qualified professional person or firm of advisors, and ensuring that such advice specifically relates to their particular circumstances.

PKF Cyprus firms are member firms of the PKF International Limited network of legally independent firms and do not accept any responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.