UK and Cyprus Agree Amendment to the 2018 Double Tax Convention


The UK and Cyprus governments have agreed an amendment to the 2018 Double Taxation Convention in response to concerns by British nationals about one of its provisions in respect of government service pensions.

The amendment will allow individuals to choose which basis of taxation they want to apply to their government service pensions. This choice can be made from 1 January 2019 until 31 December 2024.

British High Commissioner Stephen Lillie and Finance Minister Harris Georgiades signed the amended protocol today in Nicosia.

Speaking at the signing, British High Commissioner Stephen Lillie said:

“The new UK-Cyprus Double Taxation Agreement is important because of our already strong trading links and close people-to-people links, which we hope to grow further in the future.

The UK Government has listened to the concerns raised with us about one particular provision of the Convention. The pensions provision in the new Double Taxation Agreement with Cyprus mirrors the treatment in the majority of the UK’s agreements.

we recognise the impact the change in the way government service pensions are taxed will have on a small group of Cyprus residents. The changes we have agreed with the Cyprus government will therefore introduce a period of transition. That will enable existing pensioners to elect to remain within current arrangements for a period of five years, until December 2024.”

UK Government service pensions are currently taxable only in the country in which the recipient is resident, but under the 2018 Convention, they will be taxable only in the country which pays the pension.

Her Majesty’s Revenues and Customs has published guidance showing how pensioners wishing to remain within the current arrangements can make a decision. That guidance is available at

The election will apply in the calendar year in which it is made and for future years until 2024. The transition period is for a maximum of five years to 31 December 2024. If an election is not made, then the arrangements under the 2018 Double Taxation Convention will apply, in which case government service pensions will be taxable only in the UK from 1 January 2019.