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Personal Tax

Cyprus Rental Expense Records: A Landlord’s Year-End File

Separate rent, deposits, interest, repairs and capital costs before preparing the tax calculation.

PA
Philippou Accounting & TaxEditorial publisher
3 min readUpdated 26 September 2026

Quick answer

Keep a property-by-property record of gross rent, tenant balances, deposits, loan interest and expenditure. The tax treatment depends on the owner, property and type of letting; recording a payment does not make it deductible. Separate ordinary residential letting from business accommodation and do not deduct mortgage principal as interest.

Key takeaways

  • Reconcile gross rent before deducting agent fees.
  • Keep refundable deposits separate from rental income until their treatment changes.
  • Repairs, improvements and loan principal are different categories.

This guide organises the landlord’s evidence file. For the individual-versus-company tax calculation and applicable deductions, use the rental-income tax guide. Main guide.

Reconcile income to the lease

Record the property, ownership share, tenancy dates, rent due, concessions, receipts and arrears. Match the lease to the bank and explain missing months. If an agent remits rent after fees, reconstruct gross rent and the separate charge rather than reporting only the net bank receipt.

Maintain a deposit ledger showing amounts received, refunds and any amount applied to rent or damage. A refundable deposit is not automatically current rent, but its treatment can change when it is retained or applied. Keep the supporting agreement and correspondence.

Classify expenditure before claiming

Separate finance costs, repairs, improvements, insurance, communal charges, agent fees and private expenditure. Preserve invoices identifying the property and what was supplied. A kitchen replacement may contain several components requiring analysis rather than one automatic “repair” deduction.

For an individual’s building rental income, the statutory 20% deduction framework must be considered when assessing expenses. Do not automatically add every actual operating expense on top of a statutory deduction. Company ownership or business accommodation can require a different computation.

Split the mortgage statement

Obtain an annual lender statement separating interest, principal and other charges. Link the borrowing to the property and its use. A €1,200 monthly instalment is not €1,200 of deductible interest merely because the property is rented.

For illustration, if a payment comprises €400 interest and €800 principal, record the components separately. Whether the €400 is deductible still depends on the applicable conditions; the €800 principal is not an interest expense.

Review all relevant taxes

The abolition of SDC on rental income from 2026 does not eliminate income tax or automatically remove GHS or VAT questions. Check the relevant taxpayer and letting activity separately, including changes from long-term rent to short-term accommodation.

Keep the annual property schedule with the return and source documents. The expense-record guide helps organise invoices; the main-home deduction guide concerns a different relief for the person’s own home.

Frequently asked questions

No. Principal is different from interest, and interest eligibility must also be checked.

No. Income tax and other applicable obligations require separate consideration.

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PA

Philippou Accounting & Tax

Editorial publisher

Philippou Accounting publishes practical Cyprus accounting and tax guides. Sources and substantive update dates accompany the articles. General information should be checked against the circumstances of each case; a named professional reviewer is identified only when that review has been confirmed.

This article is general information based on the Cyprus tax framework for 2026 and is not a substitute for tailored professional advice. Speak to us about your specific circumstances.

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