Capital
Nicosia
Currency
Euro
Languages
Greek, Turkish
Population size
1.2M
Average Monthly Salary
€1300
EU
Since 2004
Region
Southeast-Europe
Gift Giving Norms
Modest swag; personal courtesy important
Major Corporate Gift Days
Christmas, Greek Easter
Customs Complexity
Medium
VAT - Standard Rate
19%
Duty Free Threshold
€150
Ave Duty Rate
2%
1. Employee Swag vs. Gifts
Cyprus generally follows EU principles regarding taxation. Swag given to employees can be non-taxable if deemed necessary for their work, while items viewed as extra compensation may be taxed as benefits in kind. The Tax Department, under the Ministry of Finance, provides detailed guidance on thresholds and interpretations.
1.1 Swag for Employees
Work-Related (Generally Non-Taxable)
Uniforms & Essential Tools
Items such as branded clothing needed for day-to-day work typically remain outside the scope of taxable income.
Occasional Low-Value Perks
Small gifts (e.g., a coffee mug with the company logo) may be accepted as a work-related benefit if modest in value, though there is no formal tax-free gift allowance.
Potentially Taxable Benefits
Non-Work Items
Goods of higher value or purely personal use (electronic gadgets, expensive apparel) could be treated as an employee benefit and thus included in taxable wages.
Repetitive Gifts
Providing multiple gifts throughout the year risks being seen as disguised salary. Seek local advice if you plan regular swag distributions.
1.2 Gifts for Non-Employees (Clients, Partners, Event Attendees)
Tax & Deductibility
Business gifts may be deductible if they serve a legitimate marketing or relationship-building purpose. High-value or repeated gifts lacking a clear business rationale could raise questions.
Compliance & Anti-Corruption
Cyprus adheres to EU directives on anti-bribery. Keep gift values moderate, especially if dealing with public officials, and retain records showing legitimate business intent.
1.3 Marketing Swag
Promotional Swag
Branded items primarily used for advertising (such as T-shirts, pens, or water bottles) typically qualify as marketing expenses. Document expenditure details and distribution lists for potential audits.
2. Shipping, Customs & Duties
2.1 Shipping
No Customs Duties
Because Cyprus is an EU member state, shipments from other EU countries are duty-free.
VAT Considerations
Intra-EU trade often requires charging VAT at the source or applying the reverse-charge mechanism if both parties are VAT-registered. Confirm specifics with an accountant.
2.2 Importing
Import Duties & VAT
Goods arriving from non-EU countries may incur customs duties above a certain threshold (commonly €150), in addition to 19% Cypriot VAT on (value + shipping + duties).
Documentation
A commercial invoice, correct product descriptions, and HS codes facilitate customs clearance.
2.3 DDP vs. DAP
Delivered Duty Paid (DDP)
The sender pays all import taxes/fees, simplifying receipt for the customer.
Delivered At Place (DAP)
The recipient is responsible for import costs upon arrival, which can lead to delays if unexpected.
2.4 With Monday Merch
Our warehouse in Rotterdam (the Netherlands) handles EU shipments duty-free. We can also advise on any VAT-related processes to ensure a smooth delivery experience in Cyprus.
3. Cultural & Local Etiquette
3.1 Swag customs
Mediterranean Blend
Cypriot culture is a mix of Greek, Turkish, and global influences. Modest, functional items are often appreciated more than grand, expensive gifts.
Key Holiday Periods
Christmas (December 25) is the main gift-giving season; Easter is significant but less so for corporate gifting.
Language Considerations
Greek is the primary language in the south, but English is widely spoken in business contexts. Including some Greek phrases or design touches can show cultural sensitivity.
4. Sustainability & Local Regulations
4.1 Sustainability & Regulations
EU Environmental Directives
Cyprus follows EU standards for packaging, labeling, and waste reduction. Opting for eco-friendly, minimal packaging can enhance brand image.
Consumer Safety Laws
Certain product categories (electronics, cosmetics, food items) may need local-language labels or CE marking if they are distributed widely.
5. HR & Employee Relations Considerations
5.1 HR & Employee Relations
Remote Employees
Collecting private addresses for deliveries should follow data protection principles. Cyprus aligns partly with the EU’s GDPR, so obtain consent and secure any sensitive data.
Onboarding & Retention
Providing welcome kits featuring branded apparel or stationery tends to fall outside taxation if the items are modest and job-related.
6. Summary and Key Takeaways
6.1 Summary & Takeaways
Employee Items vs. Benefits
Work-centered swag (uniforms, necessary tools) is usually non-taxable. Valuable or purely personal items could be taxed as part of wages.
B2B Gifting & Marketing
Gifts are deductible if clearly serving a business function. Promotional items typically count as marketing costs when documented properly.
Shipping & Customs
Within the EU: No customs duties, standard VAT processes.
Outside the EU: Duties and 19% VAT may apply on (value + shipping + duties).
Monday Merch Warehouse: Dispatch from Rotterdam removes customs barriers for EU destinations.
Cultural Blending
Cypriots favor practical, moderate gifts over lavish displays. Christmas is the principal corporate gifting season.
7. Frequently Asked Questions
7.1 Questions & Answers
Does giving staff swag incur tax?
Swag that’s clearly job-related is non-taxable; personal perks might be taxed.
Are B2B gifts deductible in Cyprus?
Yes, typically, if they have a clear business purpose and stay within reasonable cost limits.
Cultural advice?
Cypriots appreciate warm relationships—small, heartfelt gifts can bolster trust.
Sources
Tax Department (Ministry of Finance)
Department of Customs & Excise
Chamber of Commerce & Industry (CCCI)
Disclaimer
This material is provided for informational purposes only and does not constitute legal or tax advice. Always check with local experts or official sources to remain fully tax compliant in Cyprus.
