Every person working in Cyprus is required to pay contributions towards Social Insurance and the General Healthcare System (GHS or ΓεΣΥ). Social Insurance is where you get benefits from when you can't work in case of illness, disability, old age, etc. GHS gives you access to medical services, and every permanent resident of Cyprus can use it.

As an employer in Cyprus, you have several obligations regarding social insurance, GHS contributions, and other mandatory contributions for your employees which are calculated based on their salary. As of the 1st January 2024, the minimum monthly wage is €1,000 gross for full-time employees.

First, you need to register with the Employers' Register of the Social Insurance Services:

These payments must be made by the end of the following month for which they are due.

Remember that as an employer, you are also required to create an account in the ERGANI platform, using your Employer Registration Number. Through the platform, you must inform the Social Insurance Services of any new hires, employee termination, and other relevant information.

Particularly, as an employer you should maintain a recruitment register, which includes personal information for each employee (serial number, name, ID card number, social insurance number, date of recruitment and date of commencement of employment).

As an employee in Cyprus, where the majority of the workforce is employed by others, it's important to understand how social insurance and GHS contributions work.

The overall contribution to social insurance is 22.8% of your earnings. However, you don't cover the entire amount yourself. Contributions are divided as follows:

Similarly, GHS contributions are divided between yourself, your employer and the state.

Remember, employee contributions are deducted from your gross salary, not paid out of pocket. This means that, for example, when someone says they will pay you a gross salary of €1500 per month, 8.8% of that amount will be deducted for social insurance and 2.65% for GHS.

If you have two jobs, you will be paying these contributions for both.You don't need to worry about making these payments yourself since your employer will take care of them for you.

If you're self-employed in Cyprus, you are responsible for registering and paying your Social Insurance and GHS contributions yourself.

The overall contribution to social insurance is 21.8% of your earnings, and it is divided between yourself and the state as follows:

Similarly, GHS contributions are divided between yourself and the state.

First, you need to register as self-employed with the Social Insurance Services:

For purposes of calculating the amount of your contributions, the state bases the calculation on your occupation.

You can find a list of self-employment categories and their minimum weekly earnings below.

If you earn less than the minimum amount set by the state, you can apply to have your contributions be based on your actual earnings instead. To do that, fill out and submit form YKA 1-017

to your local Social Insurance District Office.

Remember that you'll have to make these payments yourself every three months.

If you are both an employee and self-employed at the same time, such as having a 9-5 job and a side hustle, you need to pay social insurance for both. Many people mistakenly think they don't have to pay for their side hustle if they already pay social insurance through their main employment, but this is incorrect.

Before starting a side hustle or any new venture, it's best to check with Social Insurance Services about your specific circumstances. Asking ahead of time can help you avoid legal issues in the future. While you can call them or even go there in person, it's better to send your questions via email. Having their written response can be helpful if any misunderstandings arise later on.

Rental income is not subject to Social Insurance contributions. It is however subject to GHS contributions. Regardless of the amount, rental income is subject to GHS at the rate of 2.65% of the gross rental income, and the payment method depends on whether the tenant is an individual or a company. GHS contribution on rental income only applies when the landlord is an individual, if the landlord is a company, they are exempt from paying GHS on rental income.

Where the tenant of a property is an individual, the landlord must file a self-assessment and pay the GHS on the 30th of June for the first half of the year, and 31st of December for the second half of the year. Payments are made through the Tax Portal.

Where the tenant is a company or a partnership, GHS on rental income is withheld at the source at a rate of 2.65% of the gross rental amount. This means that the tenant is responsible for deducting this amount from the gross amount of rent and pay the GHS contribution to the Tax Authorities with Form IR614A on the 30th of June for the first half of the year, and 31st of December for the second half of the year. Once again, payments are made through the Tax Portal.

Dividend income is also subject to GHS at the rate of 2.65%. Companies that pay dividends to their individual shareholders are required to withhold the GHS contribution from the dividends of their shareholders and pay it to the Tax Authorities. Companies must declare these using form TD603 and pay the GHS through the Tax Portal by the end of the month following the month in which the dividends were paid.

Social Insurance contributions are only calculated on an annual income up to €62,868. Any amount you earn over €62,868 will not be considered in these calculations.

Similarly, GHS contributions are capped at an annual income of €180,000 meaning that any amount you earn over €180,000 will not be considered in these calculations. Officers and Pensioners are also subject to a 2.65% contribution rate for the GHS. You can find more information on the GHS here.