Cyprus changes VAT margin rules for works of art and antiques

The Cyprus Tax Commissioner has changed the rules of the special VAT scheme applied to certain resale transactions, through regulatory act K.D.P. 380/2026, which amends K.D.P. 36/2002.

The main clarification: the published act expressly states that tax on the profit margin is calculated at the standard VAT rate. The conditions for using the scheme for works of art, collectors' items and antiques have also been spelled out.

Primarily art dealers, galleries, sellers of antiques and collectors' items, and tax advisers who support such transactions.

Important: this is not a change to the standard VAT rate for all Cypriot companies. The amendments concern only the special profit margin scheme used when reselling certain categories of goods, and only as regards the conditions for using it.

When choosing the margin scheme for a specific transaction, you need to re-check the conditions for its eligibility, especially if the work of art or antique was imported by the reseller themselves or acquired directly from the artist, the artist's heirs or another taxable person.

If your client or own projects include such transactions, it is worth reviewing their tax accounting in light of the new clarifications before applying the margin scheme to the next operation.