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TD.59 2026
Last reviewed: 14 January 2026
Form TD.59 (previously IR.59), known as the Declaration of Allowances Claimed For The Year, is essential for personal income tax in Cyprus. Employers must provide this form to their employees, both full-time and part-time, at the start of each year or upon new employment. It is a mandatory process applicable only to employees. The form is used by employees to declare income that impacts their tax obligations, allowing employers to make accurate monthly tax deductions.
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The TD.59 component of the form becomes particularly relevant for employees who have additional income sources. This additional income could potentially increase their tax liability and employers must be aware of any such extra income to ensure they are complying with the PAYE regulations. Employers use the information detailed in the TD.59 to accurately calculate and subsequently deduct the correct amount of income tax from the employees' salaries.
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Form TD.59 - Declaration of allowances claimed for the year 2026 - can be downloaded from the tax forms page under [EMPLOYERS] tab.
Instructions to Employees
Part A
[1] Upon completion of this declaration up to part B14 (excluding lines A1, A2, A6, A8 and B6), submit this form to your employer. If the form is not completed, no tax allowances will be granted to you by your employer.
[2] Your employer, upon completing the second column with the amounts and totals, according to the restriction of allowances and deductions, will compute your taxable income and your tax.
[3] A3 to A5. Enter any income for the year from other sources. For instance, income from a previous employment, pensions (Note 4), partnership, rents, income from buildings under preservation order, trade, interest, dividends, the redemption of life insurance policies and the partial redemption of an insurance policy.
In the case of a redemption of a life insurance policy (if the contract concerns both life and disability, then the entire contract is considered to concern life insurance) within three (3) years from the date of the policy, thirty per cent (30%) of the premiums for which a deduction was given is added to your taxable income, in cases where the redemption occurs during the fourth, fifth and sixth year from the date of the insurance policy, twenty per cent (20%) of the premiums for which a deduction was given is added to your taxable income.
For a partial redemption of an insurance policy:
a) 50% of the amount of the partial redemption if it is made before the completion of four (4) years from the date of the insurance policy and
b) 50% of the amount of the redemption that exceeds the value of the gross redemption on 31/12 of the fourth year preceding the redemption if it is made after the completion of four (4) years from the date of the insurance policy is added to the taxable income and is taxed. The amount of the gross redemption is reduced by the amount by which the partial surrenders of the three previous years exceed the premiums paid during those three years.
If you have income from sources other than employment, e.g. rents, you must submit a temporary declaration code 0200 via the Tax Portal for these, by the end of July of the year, and pay the relevant tax on the due dates.
[4] A2, A3, A5 and A9. Widow's pension. If you elect to tax widow's pension separately, enter X in the box in A9 and if you receive a widow's pension from the Social Insurance Services (SIS) enter this in the second row. If you elect to have your widow's pension taxed with your other income, at normal rates, then the widow's pension from the SIS must be entered in line A3. If it is received from the employer to whom this form is being submitted, your employer will include this income in A2 and if it is received from another source it must be entered in A5. If it is to be taxed at normal rates the deductions that relate to the widow's pensions should be included with other deductions and exemptions.
[5] A7. Enter any amounts included in A5 that are not taxable, such as income from buildings under preservation orders, interest and dividends and certain pensions (the pension given to the President of the Republic and part of the pension given to the President of the House of Representatives upon their retirement from office, the pensions and special grants given by virtue of the Relief of Suffered Laws).
[6] A10. If you are claiming the special tax rate of 8% with a minimum tax of €10,000 for AIF carried interest and UCITS performance (Articles 20b and 20c respectively) enter X in the box. This election must be made for each year independently. Your employer will enter the amounts of income subject to social insurance deductions in row (b) and the remainder in row (a). If you are not making this election the amounts should be entered in rows A1 and A2 accordingly, by your employer.
[2] Your employer, upon completing the second column with the amounts and totals, according to the restriction of allowances and deductions, will compute your taxable income and your tax.
[3] A3 to A5. Enter any income for the year from other sources. For instance, income from a previous employment, pensions (Note 4), partnership, rents, income from buildings under preservation order, trade, interest, dividends, the redemption of life insurance policies and the partial redemption of an insurance policy.
In the case of a redemption of a life insurance policy (if the contract concerns both life and disability, then the entire contract is considered to concern life insurance) within three (3) years from the date of the policy, thirty per cent (30%) of the premiums for which a deduction was given is added to your taxable income, in cases where the redemption occurs during the fourth, fifth and sixth year from the date of the insurance policy, twenty per cent (20%) of the premiums for which a deduction was given is added to your taxable income.
For a partial redemption of an insurance policy:
a) 50% of the amount of the partial redemption if it is made before the completion of four (4) years from the date of the insurance policy and
b) 50% of the amount of the redemption that exceeds the value of the gross redemption on 31/12 of the fourth year preceding the redemption if it is made after the completion of four (4) years from the date of the insurance policy is added to the taxable income and is taxed. The amount of the gross redemption is reduced by the amount by which the partial surrenders of the three previous years exceed the premiums paid during those three years.
If you have income from sources other than employment, e.g. rents, you must submit a temporary declaration code 0200 via the Tax Portal for these, by the end of July of the year, and pay the relevant tax on the due dates.
[4] A2, A3, A5 and A9. Widow's pension. If you elect to tax widow's pension separately, enter X in the box in A9 and if you receive a widow's pension from the Social Insurance Services (SIS) enter this in the second row. If you elect to have your widow's pension taxed with your other income, at normal rates, then the widow's pension from the SIS must be entered in line A3. If it is received from the employer to whom this form is being submitted, your employer will include this income in A2 and if it is received from another source it must be entered in A5. If it is to be taxed at normal rates the deductions that relate to the widow's pensions should be included with other deductions and exemptions.
[5] A7. Enter any amounts included in A5 that are not taxable, such as income from buildings under preservation orders, interest and dividends and certain pensions (the pension given to the President of the Republic and part of the pension given to the President of the House of Representatives upon their retirement from office, the pensions and special grants given by virtue of the Relief of Suffered Laws).
[6] A10. If you are claiming the special tax rate of 8% with a minimum tax of €10,000 for AIF carried interest and UCITS performance (Articles 20b and 20c respectively) enter X in the box. This election must be made for each year independently. Your employer will enter the amounts of income subject to social insurance deductions in row (b) and the remainder in row (a). If you are not making this election the amounts should be entered in rows A1 and A2 accordingly, by your employer.
Part B
[7] B2. If you are claiming a deduction for first employment in the Republic you are allowed to deduct either:
(a) 20% of your emoluments from any employment with a maximum of €8,550, or
(b) 50% of your emoluments from any employment provided that your salary exceeds €100,000 in the tax year according to Circular 2017/4 (EE04), or
(c) 50% of your emoluments from any employment provided that your salary exceeds €55,000 in the tax year according to Circular 2022/10 and 2024/04.
[8] B4. If you have declared income from rents in A4 you are allowed to claim capital allowances and interest relating to the rented property. If the rental income derives from the letting of buildings, twenty per cent (20%) of the gross rents of building only is allowed as a deduction. If you have not declared income from rents your employer will not allow these amounts.
[9] B5. If you are claiming any other deduction in B5 you must submit evidence to your employer of their validity. If no such evidence is given, your employer will not allow any deduction or allowance. If you are employed in a permanent establishment (PE) overseas, your employer will include here the amount of deduction for your employment abroad.
[10] B7 until B9. Enter the amounts that are not deducted by this employer. The total amount of contributions of the current year for life insurance, approved medical funds, GHS, pension schemes, pension and provident funds and social insurance contributions, must not exceed one fifth (1/5) of your taxable income (i.e. 20% of the intermediary calculation B6), provided that the aforementioned are approved by the Commissioner of Taxation.
[11] B9. Life Insurance Premiums and permanent or temporary, total or partial disability premiums paid during the year must not exceed 7% of the capital sum insured on that and which relates to you and not to any other person/s.
[12] B10. A deduction of €1,000 is granted for the first child, €1,250 for the second child and €1,500 for the third and each additional dependent child, provided that certain income criteria and other conditions are met. In cases of single parent families, the deduction is doubled. Please refer to the guide on the Departments Website for the criteria, the conditions, the definition of dependent child and single parent.
[13] B10 and B12. Provided that income criteria are met and under conditions a deduction of a) up to €2,000, under conditions, is granted to each spouse, civil partner or single person for interest on a serviced housing loan for the purchase or construction of a main residence in the Republic, for which the instalments are paid continuously or rent paid for the use of a main residence in the Republic and b) up to €1,000, under conditions, to each spouse or civil partner or single person for capital expenditure carried out for i) improving the energy efficiency of the main residence in the Republic ii) technical energy efficiency systems of the main residence in the Republic, renewable energy systems, as well as electrical energy storage batteries and iii) electric vehicles registered with the Department of Road Transport.
[14] B13. The amount is restricted to 50% of income after all deductions including deductions for health etc., life and provident etc. dependents and housing (B6 less B7 to B11).
(a) 20% of your emoluments from any employment with a maximum of €8,550, or
(b) 50% of your emoluments from any employment provided that your salary exceeds €100,000 in the tax year according to Circular 2017/4 (EE04), or
(c) 50% of your emoluments from any employment provided that your salary exceeds €55,000 in the tax year according to Circular 2022/10 and 2024/04.
[8] B4. If you have declared income from rents in A4 you are allowed to claim capital allowances and interest relating to the rented property. If the rental income derives from the letting of buildings, twenty per cent (20%) of the gross rents of building only is allowed as a deduction. If you have not declared income from rents your employer will not allow these amounts.
[9] B5. If you are claiming any other deduction in B5 you must submit evidence to your employer of their validity. If no such evidence is given, your employer will not allow any deduction or allowance. If you are employed in a permanent establishment (PE) overseas, your employer will include here the amount of deduction for your employment abroad.
[10] B7 until B9. Enter the amounts that are not deducted by this employer. The total amount of contributions of the current year for life insurance, approved medical funds, GHS, pension schemes, pension and provident funds and social insurance contributions, must not exceed one fifth (1/5) of your taxable income (i.e. 20% of the intermediary calculation B6), provided that the aforementioned are approved by the Commissioner of Taxation.
[11] B9. Life Insurance Premiums and permanent or temporary, total or partial disability premiums paid during the year must not exceed 7% of the capital sum insured on that and which relates to you and not to any other person/s.
[12] B10. A deduction of €1,000 is granted for the first child, €1,250 for the second child and €1,500 for the third and each additional dependent child, provided that certain income criteria and other conditions are met. In cases of single parent families, the deduction is doubled. Please refer to the guide on the Departments Website for the criteria, the conditions, the definition of dependent child and single parent.
[13] B10 and B12. Provided that income criteria are met and under conditions a deduction of a) up to €2,000, under conditions, is granted to each spouse, civil partner or single person for interest on a serviced housing loan for the purchase or construction of a main residence in the Republic, for which the instalments are paid continuously or rent paid for the use of a main residence in the Republic and b) up to €1,000, under conditions, to each spouse or civil partner or single person for capital expenditure carried out for i) improving the energy efficiency of the main residence in the Republic ii) technical energy efficiency systems of the main residence in the Republic, renewable energy systems, as well as electrical energy storage batteries and iii) electric vehicles registered with the Department of Road Transport.
[14] B13. The amount is restricted to 50% of income after all deductions including deductions for health etc., life and provident etc. dependents and housing (B6 less B7 to B11).
Frequently Asked Questions (FAQ) by Employees
– What is form TD.59 and where can I download it?
TD.59 form is a Declaration of Allowances Clamed For The Year. It is essential for your personal income tax purposes and can be downloaded from the tax forms page under the [EMPLOYERS] tab.
– How do I complete and submit the form?
You need to fill out the form up to part B14, but skip lines A1, A2, A6, A8, and B6. After completing, submit the form to your employer. This step is crucial as failing to submit the form means you will not receive any tax allowances from your employer.
– What should I do if I have income from sources other than my current employment?
Report any additional income such as from previous jobs, pensions, rents, and dividends in sections A4 to A5 of the form. If you have rental income or other similar earnings, you must also file a provisional/temporary declaration by the end of July and pay the associated tax on the stipulated due dates.
– How do I handle non-taxable income on the form?
Some types of income, like certain pensions, interest, dividends, and income from buildings under preservation orders, are not taxable. You should enter these amounts in section A7 of the form.
– What about a widow’s pension? How is it taxed?
If you receive a widow’s pension and wish to tax it separately, mark this in section A9. The source of the pension determines where you enter it: if it is from the Social Security Department, it goes in the second row of A9; if from your current employer, in A2; and if from another source, in A5.
– Can I claim a special tax rate for certain types of income?
Yes, if you are eligible for a special tax rate of 8% with a minimum tax of €10,000 (applicable for AIF carried interest and UCITS performance), indicate this by marking [X] in box A10. This choice must be made annually.
– How do I claim deductions for first employment?
If this is your first employment in Cyprus, you can claim a deduction of either 20% of your emoluments up to €8,550, or 50% if your salary exceeds certain thresholds as outlined in specific tax circulars.
– What if I have rental income?
You can claim deductions for rental income, including capital allowances and interest related to the rented property. Specifically, for buildings, you can deduct 20% of the gross rents.
– What evidence is required for other deductions?
If you are claiming deductions in section B4 (other than rental income), you must provide your employer with proof of their validity.
– What are the limits on deductible contributions for insurance and pension schemes?
The total amount of your contributions to life insurance, approved medical funds, and pension schemes must not exceed 1/5 of your taxable income.
– How much can I deduct for life insurance premiums?
The premiums paid during the year for life insurance must not exceed 7% of the capital sum insured on your life.
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Instructions to Employers
Part B
[15] All your employees must complete and sign form TD.59A, every year. It is clarified that a director of a company or any person involved in the management of a company is considered to be an employee. If no TD.59A is submitted, then you will not allow any deduction other the contributions that are known to you (i.e. B7 & B8).
[16] A1 and A2. Fill in the second column of A1 with the estimated income and benefits for the year for which GHS withheld is payable the Social Insurance Services e.g. residence benefit. Income that does not fall under this is recorded in A2, e.g. the deemed benefits stipulated by the Income Tax Law 118(I)/2002 as amended.
Notes 4 and 6 above are relevant.
Income includes wage / wages, overtime pay, tips, benefits, share of earnings, perquisite, fees, rights, commissions, pensions, annual residence value, grocery lodging or other lucrative benefit (monetary or non-monetary) (Article 6 (3) of the Taxation and Collection of Taxes Law 4/78 as amended) as well as the reasonable benefits provided by Income Tax Law 118(I)/2002 as amended. The tax applicable to bonuses, as well as other income not paid on an ad hoc basis, must be deducted on the month in which this amount is paid to employee.
[17] A9 and A10. Special Rates, if elected by the employee. Please keep in mind Notes 4 and 6 above. Widow's pension: Includes widow's pension paid by you in A9(a). For the income in A9(a) you are obliged to deduct GHS and income tax. If your employee authorises you, you may also deduct income tax for widow's pension received from the Social Insurance Services and enter the pension in 9(b). In this case you should not enter it in A3.
Special tax rate of 8%: Include in A10b the amounts that are subject to social insurance deductions and the remainder in A10a. For the income in A10a and A10b you must deduct income tax, while on the amounts of A10a you must deduct GHS as well.
[18] Fill in Β1-Β5 in the second column taking into account the restrictions mentioned in the instructions above for PART B and compute the intermediary calculation in B6.
[19] B7. Complete the amounts of contributions to pension funds, provident funds etc. having in mind the restrictions applicable to the contributions to the medical fund (maximum 2% of gross income per circular 3/30.5.24) and the provident fund in accordance to the provisions of its approval.
[20] Fill in B7 - B13 in the second column taking into account the restrictions mentioned above and compute the total deductions and the taxable income.
[16] A1 and A2. Fill in the second column of A1 with the estimated income and benefits for the year for which GHS withheld is payable the Social Insurance Services e.g. residence benefit. Income that does not fall under this is recorded in A2, e.g. the deemed benefits stipulated by the Income Tax Law 118(I)/2002 as amended.
Notes 4 and 6 above are relevant.
Income includes wage / wages, overtime pay, tips, benefits, share of earnings, perquisite, fees, rights, commissions, pensions, annual residence value, grocery lodging or other lucrative benefit (monetary or non-monetary) (Article 6 (3) of the Taxation and Collection of Taxes Law 4/78 as amended) as well as the reasonable benefits provided by Income Tax Law 118(I)/2002 as amended. The tax applicable to bonuses, as well as other income not paid on an ad hoc basis, must be deducted on the month in which this amount is paid to employee.
[17] A9 and A10. Special Rates, if elected by the employee. Please keep in mind Notes 4 and 6 above. Widow's pension: Includes widow's pension paid by you in A9(a). For the income in A9(a) you are obliged to deduct GHS and income tax. If your employee authorises you, you may also deduct income tax for widow's pension received from the Social Insurance Services and enter the pension in 9(b). In this case you should not enter it in A3.
Special tax rate of 8%: Include in A10b the amounts that are subject to social insurance deductions and the remainder in A10a. For the income in A10a and A10b you must deduct income tax, while on the amounts of A10a you must deduct GHS as well.
[18] Fill in Β1-Β5 in the second column taking into account the restrictions mentioned in the instructions above for PART B and compute the intermediary calculation in B6.
[19] B7. Complete the amounts of contributions to pension funds, provident funds etc. having in mind the restrictions applicable to the contributions to the medical fund (maximum 2% of gross income per circular 3/30.5.24) and the provident fund in accordance to the provisions of its approval.
[20] Fill in B7 - B13 in the second column taking into account the restrictions mentioned above and compute the total deductions and the taxable income.
Part C
[21] C1 and C2. Compute the tax on taxable income and the tax that must be deducted (i.e. the proportion relating to income from your employees' salary adding the possible tax on widow's pension if the latter is being taxed separately and the amount on 2nd parenthesis, if it is positive and the tax with special rates). You must NOT deduct any tax based on income from other sources than Social Insurance Fund Pensions (see Note 3).
[22] C4. For income for which you are the employer, you must withhold 2.65% GHS When the total of these income (lines A1, A2, A9 and A10) exceeds the amount of €180,000, then you can stop withholding GHS for the following months on income from lines A2, A9a and A10a.
[22] C4. For income for which you are the employer, you must withhold 2.65% GHS When the total of these income (lines A1, A2, A9 and A10) exceeds the amount of €180,000, then you can stop withholding GHS for the following months on income from lines A2, A9a and A10a.
Frequently Asked Questions (FAQ) by Employers
– What is the importance of form TD.59 for my employees?
As an employer, it is your responsibility to ensure that all your employees, including those in management positions, complete and sign the TD.59 form every year. This form is crucial for determining the tax allowances and deductions applicable to each employee.
– How should I process special rates and widow’s pensions on the form?
When an employee opts for special rates (like the 8% tax rate for certain incomes) or receives a widow’s pension, you need to include these in the respective sections of the form (A9 and A10) and calculate the tax deductions accordingly.
– What if an employee does not submit the TD.59 form?
In cases where an employee fails to submit this form, you are limited to allowing only the standard tax-free amount and the contributions known to you (such as social insurance contributions). This means the employee might miss out on potential deductions and allowances.
– How do I calculate an employee's taxable income?
You need to fill out the second column of the form with the estimated income for the year that is subject to Social Security deductions. This includes wages, benefits, and other taxable perks. You then compute the employee's taxable income based on these figures.
– What are my responsibilities regarding GHS deductions?
You are required to withhold 2.65% for the GHS from certain types of income until the total income exceeds €180,000. Once this threshold is exceeded, you should stop withholding GHS.