What sits on top of gross salary
Six contributions, and it is worth seeing them separately because they behave differently:
- Social insurance — 8.8% employer, 8.8% employee. The 8.8% rate applies from 1 January 2024 for five years, so 2026 is still at 8.8%. It rises again in later five-year steps.
- General Healthcare System (GHS) — 2.90% employer, 2.65% employee.
- Social cohesion fund — 2.0%, employer only. This one has no ceiling: it is calculated on total emoluments, not on insurable earnings.
- Redundancy fund — 1.2%, employer only.
- Industrial training (HRDF) — 0.5%, employer only.
- Central holiday fund — 8%, employer only, unless your company is exempt because it grants leave itself.
That makes 15.4% for the employer and 11.45% for the employee, plus the holiday fund where it applies.
The two ceilings, and the contribution that ignores them
Cyprus has two separate ceilings, and mixing them up is the most common payroll error.
Maximum insurable earnings for 2026: €1,325 a week, €5,742 a month, €68,904 a year. Social insurance, the redundancy fund, industrial training and the holiday fund stop there. Above that salary level those contributions no longer grow.
The GHS ceiling is different and much higher: €180,000 of total annual income per person — not per employment. And the social cohesion fund has no ceiling at all, which means it keeps growing with every euro of salary.
The practical consequence: for a salary well above €68,904 the employer’s effective rate falls, because four of the six contributions have stopped. For the cohesion fund it never falls.
One deadline, two authorities, two portals
Everything for a given month is due by the end of the following month. Contributions for August are due by 30 September. That part is simple. The split is not:
- Tax Department, through Tax For All: the income tax withheld from salaries (PAYE) and the monthly employer declaration T.D.7. The declaration has to be submitted before you pay, because it is what creates the liability in the portal.
- Social Insurance Services, through SISnet: social insurance, the redundancy fund, industrial training, the cohesion fund, the holiday fund and the GHS share on salaries, on the “Statement of Earnings and Contributions” (form Y.K.A. 2-002).
- ERGANI: registering a new hire, before employment starts.
One obligation sits alongside these and is not yours: a newly hired EU citizen has to register themselves as a resident. That is a separate procedure with the migration authority on its own deadline, and none of your three payroll filings replaces it — the detail is in the guide to the Yellow Slip.
So a single month’s payroll produces filings in two systems. Neither authority reminds you about the other.
The annual employer declaration
Alongside the monthly filings there is an annual T.D.7, due at the end of March following the reference year. This one is extended almost every year: for tax year 2025 the statutory 31 May 2026 became 30 September 2026, and the 2024 declaration was moved to 31 March 2026.
Employees also receive an emoluments certificate (T.D.63). We could not find a published deadline for handing it out; secondary sources contradict each other, so we are not going to name one.
What late costs
- Social insurance arrears: 3% for the first month, plus three percentage points for each further month, capped at 27%.
- Income tax withheld but not paid over: default interest — 3.5% for 2026, down from 5.5% in 2025 — plus an additional 1% for every month of delay.
- Late payment of direct taxes generally: 5%, plus a further 5% after two months.
- Late filing from 1 January 2026: €150 for an individual, €250 for a legal person, €500 for a legal person with turnover or assets above €1 million.
The 1%-per-month charge on withheld tax deserves emphasis: that money was never yours. The authorities treat holding on to it more harshly than a late payment of your own tax.
What the 2026 reform changed for payroll
The tax reform in force since 1 January 2026 raised the personal tax-free threshold from €19,500 to €22,000, with bands up to a top rate of 35% above €72,000. That changed the PAYE tables from January 2026 — so if your payroll still deducts on the 2025 tables, it is deducting too much.
Contribution rates themselves were not part of the reform. What did change for 2026 is the insurable earnings ceiling, raised from €66,612 to €68,904.
Self-employed people
Self-employed persons pay 16.6% social insurance and 4.00% GHS on their income, plus a further 0.5% to the Human Resource Development Authority since 5 January 2026. Unlike payroll, the contribution does not run on actual earnings but on a minimum amount per occupational category: the weekly basic figure of €220.76 times a coefficient between 1.50 and 4.45. The ceiling of €1,325 a week is the same as for employees. All sixteen categories, the quarterly amounts and the deadlines are in the guide for self-employed people in Cyprus.
Where payroll meets the rest of your books
Payroll is the part of Cypriot compliance most often kept apart from everything else: wages in one spreadsheet, invoices in a tool, receipts in a folder. The result is that the monthly cost of staff never appears in the same report as revenue, and the annual figures have to be reassembled by hand.
Volk Accountant keeps wages, invoices and receipts together, so the monthly payroll total lands in your reports and your accountant’s export without a separate file. The every Cyprus tax deadline puts these monthly dates next to all the others a Cyprus company owes.