Retiring to Cyprus: Step-by-step guide

Dreaming of sun-kissed beaches and sparkling seas for your retirement? If so, Cyprus could be an excellent choice. This gorgeous Mediterranean island is a popular destination with UK expats, with around 70,000 Brits¹ currently living there.

But just how easy is retiring to Cyprus after Brexit? In this guide, we’ll run through everything you need to know to plan your big move. This includes essential info on visas, pensions and of course, post-Brexit changes and rules.

We’ll even throw in a handy tip to help you manage your money across international borders. Open a Wise multi-currency account and you can send money to Cyprus to cover your relocation costs for low fees and the real, mid-market exchange rate. And after you’ve moved to Cyprus, you can even use Wise to swerve currency conversion costs when receiving your state pension and other UK income.

Learn more

But more on this later. Let’s start with why you might want to retire to Cyprus, and whether there are any potential drawbacks to bear in mind.

Retiring to Cyprus - pros and cons to consider

Moving to a new country is a big decision. So before you settle on Cyprus for your retirement, here are a few pros and cons to weigh up.

Pros:

• Beautiful weather and Blue Flag beaches. Cyprus is estimated to receive a huge 3,500 hours of Mediterranean sunshine a year². And of course, the best place to enjoy it is on the beach. If you’re dreaming of escaping cold British winters, you can lay out your beach towel on one of Cyprus’ many pristine Blue Flag beaches.

• Great quality of life. If the sound of laid-back living in a sunny coastal retreat is appealing, Cyprus is the place for you. But you can also explore its charming traditional villages, lush forests, mountains and many historical points of interest, including monuments and monasteries. The island is also famous for its love of food - the national cuisine which is a delicious fusion of Greek, Turkish and other Mediterranean influences.

• Low cost of living³. Cyprus is cheaper than the UK across nearly all spending categories, so your retirement savings will go further here. For example, a three-course meal in Cyprus costs around £43 for two people, whereas it’s £50 in the UK. A beer is around £2.59 compared to £3.70 in the UK, and a monthly public transport pass will set you back around £35 compared to £65 in the UK. The only thing that’s slightly more expensive in Cyprus is groceries, although it depends what’s in your shopping basket.

• Affordable property³. The cost of buying a home in Cyprus is up to 65% cheaper than the UK, depending whether you buy in or outside of a city centre. If buying isn’t for you, rent for a one-bed apartment in a Cyprus city centre is around £500, whereas you’d pay around £745 a month to rent in a UK city centre.

English is also widely spoken in Cyprus, although you may need to make an effort with the language if you move to a smaller or more traditional area.

Cons:

• Wet winters. January and February can be very wet months in Cyprus, but the temperatures are still likely to be higher than the UK.

• Public transport isn’t amazing in Cyprus. There are no trains, so public transport on the island mainly consists of buses. If you want to get anywhere not served by a bus route, driving or taking a taxi is the only viable option.

• Tourist hotspots can get very busy in summer. If you’re not a fan of the summertime crowds at the beaches, you may want to choose somewhere quieter to live inland.

Best places to retire to in Cyprus

So, where should you choose for your retirement in the sun? Let’s take a look at a few of the most popular destinations in Cyprus for UK retirees:

Paphos

The coastal city of Paphos in southwest Cyprus is a hugely popular destination for UK retirees, as there’s a large expat community here. Paphos also has a choice of neighbourhoods, whether you prefer the lively tourist hotspot of Kato Paphos or the peace of the traditional old town.

Many expats love living in the hills behind Paphos town, in villages with traditional tavernas and authentic Cypriot coffee shops (it’s also cooler up in the hills, thanks to refreshing sea breezes).

Paphos is also extremely well connected with affordable flights back to the UK and worldwide.

Limassol

The second largest urban area on the island, Limassol on the island’s southern coast is a fascinating blend of modern architecture and a traditional historic centre. There’s lots going on here, from watersports to evening entertainment, but you can also enjoy the quiet life in Limassol by settling into a cafe at the beautiful beachfront.

Limassol has a good choice of property for expats, including apartments and new luxury developments. There’s also the lively Limassol Carnival to look forward to each year.

Larnaca

This compact city on Cyprus’ southern coast is sleepier and more authentically Cypriot than other major cities on the island. If you want to escape the tourists and aren’t interested in joining such a large expat community, Larnaca is the place for you.

It has a gorgeous beach with a palm tree-lined promenade, affordable property, fascinating architecture and a cosmopolitan atmosphere in the city centre. All in all, Larnaca is something of a hidden gem.

Lania

The village of Lania near the Troödos Mountains offers plenty of lovely sunny weather, but also a chance to escape into the cooler mountains during the hot summer months. It’s also just 20 minutes from Limassol, so you’ll have easy access to city centre amenities.

Parekklisia

To experience authentic village living, settle in Parekklisia. This peaceful spot is just a short drive from Limassol should you want a livelier weekend or evening out, but there’s plenty of attractions in the village itself. There’s even a British retiree community here which organises regular activities and events.

Pyrgos

Another village with easy access to the city of Limassol, Pyrgos is a great retirement destination if you love hiking and walking. It’s a scenic spot, surrounded by plenty of greenery. You can even learn new skills at the many classes taking place in the village, which is a great way to make new friends as a newcomer.

Retiring to Cyprus after Brexit - facts and key info you need to know

• Pensions. You can apply to receive your UK state pension in Cyprus, but transferring over other personal pensions may be tricky. This is because Cyprus doesn’t have any Qualifying Recognised Overseas Pension Schemes (QROPS) on HMRC’s approved list for international pension transfers⁴. So, you could get hit with a huge tax bill if you do try to transfer UK pensions over to a non-QROPS scheme in Cyprus. If you’ve worked in Cyprus for the required number of years, you may be eligible to receive the Cyprus state pension too.

• Taxes. The UK and Cyprus have a double taxation agreement⁵, so you won’t pay tax on the same income in both countries. However, if you live in Cyprus for more than 183 days a year⁶, you’ll need to pay tax on all income earned in Cyprus and worldwide. The good news is that the first €19,500⁷ of your income is tax free.

• Healthcare⁸. State healthcare isn’t free, but it is subsidised by government contributions. UK retirees can access the healthcare system if they have a permanent residents’ medical card, or using the S1 form - if you receive the UK state pension, this form entitles you to state healthcare in Cyprus paid for by the UK. You can also opt to take out private medical insurance.

• Driving licences. Following the changes brought about by Brexit, UK citizens moving to Cyprus will need to exchange their UK driving licence to a Cypriot one⁵.

• Property⁹. Non-EU citizens have the right to buy property in Cyprus, but you will need to seek permission. Plus, you’ll be restricted to up to one acre of land or one house or apartment.

Do I need a retirement visa for Cyprus?

Now that the UK has left the European Union, British citizens no longer have the right to settle in EU countries like Cyprus without a visa or residency documents.

If you haven’t lived in Cyprus before and didn’t have residency documents before 31st December, certain restrictions will apply if you want to retire there.

UK citizens can visit Cyprus for up to 90 days in any 180-day period without a visa¹⁰, but if you want to stay longer you’ll need to apply for a temporary residence permit¹¹. This is also known as a ‘pink slip’. It gives non-EU nationals the option to legally extend their stay in Cyprus for up to a year, and you can apply to renew it every year.

With this permit, you can live in Cyprus but you can’t work - this makes it a good option for retirees. It’s also important to note that you can’t stay out of the country for more than 3 months as this could invalidate your permit¹¹.

Once you’ve lived in Cyprus for more than 5 years, you can apply for permanent residency⁵.

There may also be options for permanent residence in Cyprus through an immigration permit¹¹. These are often issued on the basis of employment in particular industries, but retirees may be eligible if they can provide evidence of a secure regular income or are able to invest in property. More information is available on the Cypriot Government Migration Department website.

Requirements for retiring to Cyprus - a step-by-step guide

There’s a lot to do before you can start your new post-work life in Cyprus. Here are some of the most important things to add to your to-do list:

1. Find somewhere to live. You may need to make a few trips out to Cyprus to really get a feel for your chosen town, city or region. It can also take some time to scout out the perfect property to rent or buy.

2. Tell HMRC you’re leaving the UK. You can also make a claim with the International Pensions Centre to receive your UK state pension in Cyprus. This could be a good time to speak to an expert pensions adviser, to work out the best and most tax-efficient solutions for other pensions.

3. Arrange to have your furniture and belongings shipped to Cyprus. Compare a few different quotes, or consider saving money on shipping by travelling light and buying what you need out there.

4. Register for a temporary resident permit. You can do this once you arrive at the Civil Registry and Migration Department.

5. Register for healthcare. You can find out how to register at Cyprus’ General Healthcare System website. Alternatively, complete the S1 form or look into getting private medical insurance.

6. Exchange your driving licence. If you plan to drive in Cyprus, you’ll need to exchange your UK licence for a Cypriot one.

Save on your relocation to Cyprus with Wise

You’ll have lots of international costs to cover when planning your retirement in Cyprus, especially in relation to finding somewhere to live.

You can save money on these relocation costs using Wise. Open a Wise multi-currency account and you can send money between the UK and Cyprus for low fees and the real, mid-market exchange rate.

This convenient, secure account is also a good option for receiving your UK state pension and other UK income, as payments can be received in GBP and converted to EUR using Wise’s fairer exchange rates.

And from the moment you arrive in Cyprus, you can spend like a local using the Wise debit card. This automatically converts currency to EUR at the real, mid-market exchange rate when you spend, so you don’t need to carry cash around or change money. So, you can cross a trip to the local Bureau de Change off your to-do list.

Join Wise and start saving today

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So, that’s pretty much it - everything you need to know about retiring in Cyprus from the UK. We’ve covered it all, from visas and residency permits to healthcare, pensions and post-Brexit changes too.

You should be all set to plan your big move. Good luck and enjoy your well-earned retirement!

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Sources used for this article:

1. International Investment - post-Brexit papers
2. Property Guides - buying property in Cyprus
3. Numbeo - cost of living in Cyprus
4. Blevins Franks - pros and cons of QROPS
5. Gov.uk - living in Cyprus
6. Europa.eu - income tax in Cyprus
7. Blevins Franks - financial benefits of living in Cyprus
8. Gov.uk - healthcare in Cyprus
9. Expat Arrivals - buying property in Cyprus
10. Gov.uk - entry requirements
11. Mondaq - relocation of UK nationals to Cyprus

Sources checked on 5th May 2021