Money in the Mediterranean
Cyprus extended incentives to unscripted productions...and its scripted industry took off
For years, unscripted producers felt largely shut out of incentives programs in the EU.
Cyprus helped change that…and now, scripted is booming on the island, too, with a Netflix chart-topper, Sundance premieres, and an Oscar shortlister.
Until 2018, if you were producing travel, lifestyle, or reality content in the EU and hoped to score an incentive, you were out of luck.
The restriction was rooted in EU regulations that required productions to meet cultural tests; member states largely interpreted that rule to mean that the only factual projects that qualified – maybe – were scripted documentaries, not broader entertainment, like reality competition formats.
The result: EU jurisdictions often missed out on the long-tail benefits of unscripted, like workforce development, reliable returning seasons, the tourism benefit, and the potential for unscripted format hubs.
Then, Cyprus challenged the narrow interpretation of the EU’s cultural test rule, and it’s paid dividends ever since.
Reality series like Warner Bros Discovery’s Superstars (now filming its ninth season on the island) and Swedish Love Island (which filmed its third, fourth, and fifth seasons in Cyprus) showed up to film in Cyprus – and kept returning, helping to boost the island’s reputation as a desirable and reliable production destination. And last year, three different versions of the Amazon Prime travel-comedy series Roast on the Coast – Danish, Norwegian, and Swedish – received funding.
Several high-profile films and scripted series followed, including:
Netflix’s #1 global hit, Find Me Falling – with director Stelana Kliris subsequently returning for her next project, Apart From Her.
All That’s Left of You, a Cyprus-Germany co-production filmed in Cyprus after the Gaza war forced a relocation from Palestine, with executive producers Mark Ruffalo and Javier Bardem. The film premiered at the 2025 Sundance Film Festival and went on to make the Oscar shortlist as Jordan’s official submission for Best International Feature Film.
Season two of British thriller The Ex-Wife, streaming on Paramount+, with island locations even doubling for London in some scenes (!).
“The Sunshine Murders,” a TV Series by Emily Corcoran, for the UK’s Channel 5.
“Yes,” written and directed by Nadav Lapid. A co-production between France, Israel, Cyprus, and Germany, the film had its world premiere at the Directors’ Fortnight section of the 2025 Cannes Film Festival.
Minos Papas’s Motherwitch – premiering at Sundance and IFFR in early 2026.
One of the EU’s most alluring incentives
The engine behind the production boom in Cyprus is a film incentive program that delivers some of the most competitive rates in Europe:
a cash rebate of up to 45% on below-the-line expenditures and up to 25% on above-the-line expenses
An alternate 35% tax credit
VAT refunds on qualifying expenses
Tax discounts on investment in infrastructure.
Cyprus has a word for what it’s building: Olivewood.
Here’s what you need to know about the incentive that’s funding it.
Two Paths In: Cash Rebate and a Tax Credit – plus a bonus VAT Refund and tax deduction for infrastructure investment
The Cyprus Film Scheme gives productions two distinct financial mechanisms, administered by the Cyprus Film Commission through Invest Cyprus.
Cash Rebate: A direct cash rebate on qualifying Cypriot expenditures – up to 45% on below-the-line costs and 25% on above-the-line costs. The exact rate is determined by the production’s score on a cultural test.
Tax Credit: For productions that prefer to offset corporate tax liability rather than receive a cash payment, the tax credit offers 25-35% on qualifying above- and below-the-line local expenses. Again, the percentage depends on the production’s score on the cultural test.
Foreign productions incurring qualifying expenditures in Cyprus are also entitled to a refund of Cypriot VAT (which runs at 19%, 9%, or 5% depending on the product or service). Refunds are processed within 6 months of the applicable declaration period. This stacks on top of the cash rebate or tax credit. For productions with significant local spend, it adds up.
There’s yet another benefit for Cypriot-registered SMEs: a tax deduction for investments in infrastructure and equipment, up to 20% for small enterprises and 10% for medium enterprises. Equipment must remain on the island for at least five years.
Important: The cultural test requirement didn’t go away for these programs; productions must show that they capture and promote Cypriot and/or European culture in some fashion (more on this below). The island’s rich variety of locations and cultural offerings makes that a relatively easy bar to clear.
The Cash Rebate: What Qualifies
The most eye-catching rate is a 45% refund on below-the-line expenditures – crew, equipment rental, local services, accommodation, transportation, props, set design, and post-production conducted in Cyprus. Above-the-line costs – producer, director, scriptwriters (if the script is written in Cyprus), casting directors, and up to three leading roles – qualify at 25%, capped at 30% of total eligible Cyprus expenditure.
Key financial parameters:
Up to 45% cash rebate on qualifying below-the-line expenditures in Cyprus
25% cash rebate on qualifying above-the-line expenditures (capped at 30% of total eligible spend)
Per-project maximum rebate: €5 million
Annual program cap: €25 million
Rebate timeline: Disbursed within 120 days of final approval of the audit report
Eligible content: Feature Films (including animation), Television series of high standard, Reality Shows, Documentaries, and Animation for TV.
Minimum spend to qualify:
Feature films: €200,000
TV series: €65,000/episode (minimum expenditure of €180,000 for 2 or more episodes)
Other audiovisual productions: €100,000
At least 20% of production budget and principal photography days must be spent in Cyprus
These are among the lowest minimum thresholds in the European incentive landscape - a deliberate design choice that keeps the program accessible to independent and mid-budget productions, not just studio-scale shoots.
The Tax Credit: Important Considerations
As an alternative to the cash rebate, Cyprus offers a 25-35% tax credit on all eligible local expenditures – both above-the-line and below-the-line. This represents a key structural difference from the cash rebate: the tax credit doesn’t separately differentiate between above-the-line and below-the-line costs, instead treating all eligible production expenditure uniformly.
Key financial parameters:
Up to 35% tax credit (minimum 25%) on all qualifying eligible expenditures in Cyprus
Applied against corporate taxable income in the year of production
Cannot exceed 50% of the applicant’s taxable income in any given tax year
Unused credits carry forward up to 5 years, subject to the 50% annual restriction
Non-transferable to third parties – ceases to have value upon voluntary or involuntary liquidation
Tax credit certificate issuance: Within approximately 60 calendar days of final approval (faster than the 120-day cash rebate timeline)
Eligible content: Identical to cash rebate – feature films, TV series and mini-series, documentaries, animation, reality television, and other audiovisual productions
Note that the minimum spending and thresholds are the same as the cash rebate.
The Cultural Test
The exact rebate rate a production receives is determined by scoring on a cultural test, an assessment of the production’s economic and cultural benefit to Cyprus. This includes factors like the amount of cultural content, creative contribution, use of local cultural infrastructure, and promotion of Cypriot, European, or world culture.
Producers who engage with the Commission early and understand how the test scores are calculated can structure their production to maximize their rate. This is not a pass/fail gate; it’s a sliding scale that rewards deeper engagement with the island’s creative and cultural fabric.
Who Qualifies – and What You Need to Apply
Eligibility for the Cyprus Film Scheme requires meeting several baseline conditions:
The applicant must be either:
a special vehicle entity (AVC) registered in Cyprus or another EU member state with a business presence in Cyprus (directly or through a branch) OR
or a legal or natural Cypriot or European citizen who is a tax resident of Cyprus
Non-EU companies can structure through a Cypriot entity.
Proven production track record: The applicant must demonstrate experience with at least two productions completed in the last seven years.
A dedicated Cypriot bank account must be opened for all production-related transactions.
Proof of funding covering at least 50% of the total production budget is required at application.
Local hiring requirements: At minimum, 8 below-the-line crew (4 in the case of Documentaries), 2 above-the-line (1 for Documentaries), and 1 production team member must be Cypriot nationals or EU residents. In addition, the Applicant must hire 4 interns who are Cypriot nationals or EU residents.
A CPA audit is required to certify qualifying expenditures before the rebate can be claimed.
The Application Process
The Cyprus Film Commission runs a structured two-phase process:
Pre-Approval: Submit an online application via the Film in Cyprus website with production plans, budget breakdowns, and proof of funding. The Commission reviews and issues a Temporary Approval Certificate within 90 days of submission of the completed application. Once that certificate is in hand, filming must commence within 24 weeks.
Final Approval: Upon completing production, submit audited financial reports and supporting documentation. The Commission assesses the claim and makes a final recommendation to the Competent Authority. Cash rebates are disbursed within 120 days of final approval, tax certificates within 60 days.
The EU Advantage
This is the part of the Cyprus story that doesn’t get enough attention in the international production community.
Cyprus is the only English-speaking EU member state in the Eastern Mediterranean. That single fact unlocks a cluster of structural advantages that other competing locations in the region cannot offer:
EU co-production access. Productions structured as official EU co-productions through Cyprus can access European funding frameworks, including Eurimages and MEDIA programme support, in addition to the Film Scheme. The total aid cap of 50% of the production budget (or 60% for co-productions) can even be lifted if the production demonstrably benefits Cyprus’s cultural or economic development.
No currency risk. Cyprus uses the euro – no hedging, no exchange rate exposure, no conversion costs. For productions financing from the US or UK, this eliminates a layer of financial complexity that other Mediterranean markets introduce.
EU legal and regulatory framework. Contracts, labor agreements, intellectual property, and dispute resolution operate within an EU legal structure, something financiers, studios, and distributors find materially easier to work with than jurisdictions outside the bloc.
English is an official working language. Scripts, contracts, location permits – they’re all in English. No translation layer, no interpretation risk.
Locations: Ancient Meets Contemporary
Cyprus has one of the Mediterranean’s most versatile location profiles. The island packs an extraordinary range into a small geography: UNESCO-listed ancient ruins at Paphos and Choirokoitia, Byzantine monasteries in the Troodos mountains, British colonial architecture in Nicosia’s old city, dramatic cliff-side coastlines, salt lakes, pine forests, and some of the most reliably photogenic beaches in Europe. Average annual sunshine exceeds 320 days.
The island has doubled for ancient Rome, the Middle East, North Africa, and generic “Mediterranean Europe” in productions ranging from historical epics to contemporary thrillers. And because Cyprus sits at the geographic crossroads of Europe, the Middle East, and North Africa – just over an hour’s flight from Tel Aviv, Beirut, Cairo, and Athens – it can function as a practical base for regional productions with complex multi-location shooting requirements.
The Fine Print
The per-project, €5 million cap matters for large-budget productions. A production spending €20 million in Cyprus at 45% BTL rates would theoretically generate €5 million. Productions at that scale should model the tax credit structure and carry-forward provisions carefully and consider co-production structures that may increase flexibility.
The annual €25 million program cap requires monitoring. With 14 productions approved in 2024 and activity accelerating, producers should not assume the annual cap is always available. Engage the Commission early to understand current allocation status before building a shoot schedule around the incentive.
The cultural test determines your rate. This is not a binary pass/fail – it’s a scoring system. Productions that treat the cultural test as an afterthought may receive a meaningfully lower rebate percentage than productions that structure for it from development. Know your score before you commit to a budget model.
The 24-week commencement window is firm. Once you receive your Temporary Approval Certificate, filming must begin within 24 weeks. Productions that experience development delays or financing complications after pre-approval risk losing their approved position and must reapply.
The scheme’s current authorization runs through June 30, 2027. The approval process for all submitted applications must be completed by that date. A further renewal is expected beyond that horizon, but productions planning slates into 2028 and beyond should confirm status directly with the Commission.
A CPA audit is non-negotiable. Budget for the cost of a Cyprus-registered certified public accountant to certify your qualifying expenditures. This must be completed before any rebate claim can be submitted.
The Bottom Line
Cyprus has built a genuinely competitive incentive: up to 45% on below-the-line spend, a stackable VAT refund, EU legal and financial infrastructure, English as a working language, and one of the most accessible minimum spend thresholds in European incentives. Find Me Falling put a global spotlight on what Cyprus can actually deliver on screen – and what followed confirmed it wasn’t a fluke. An Oscar-shortlisted co-production. Two festival premieres at Sundance and IFFR. A fifth season of Swedish Love Island. Repeat business from Amazon, Warner Bros Discovery, and a growing list of European broadcasters. Cypriot films screened at more than 45 events worldwide in 2025 alone. The number of major production companies now working with Cyprus – Channel 4, Channel 5, ITV, Canal+, ZDF, Warner Bros, Amazon – reads like a who’s who of international television.
The constraints are real: the per-project €5 million cap limits returns for large-budget shoots, the cultural test requires active management to maximize, and the annual cap is a finite resource that fills as Cyprus’s profile grows. But for productions in the right size range – independent features, mid-budget streaming series, documentaries, reality formats – Cyprus offers a combination of incentive depth, operational ease, and location versatility that is hard to find elsewhere in the Mediterranean.
Olivewood is not just a marketing slogan. It’s a program, and it’s working.
For full program details, visit Film in Cyprus or contact the Commission at leleftheriou@investcyprus.org.cy.
Producing across borders?
Hosting foreign crews?
Be prepared.
International productions and co-productions deliver significant financial benefits, but cultural misunderstandings can quickly erode those savings through miscommunication, project delays, and team friction.
Globally Minded helps production companies, crews, film commissions, and service providers turn cultural differences into strategic advantages. With 25+ years of leading multicultural teams across five continents and delivering millions in cost savings through international partnerships, we provide:
For Production Companies & Crews: Cultural intelligence training, location culture research, and team playbooks that prevent costly miscommunications, accelerate team cohesion, and maximize the ROI of your international shoots and partnerships
For Film Commissions & Service Providers: Tools to better serve foreign clients, differentiate your location, and build lasting production relationships that bring crews back
Whether you’re shooting abroad, collaborating with international partners, or hosting foreign productions, cultural agility isn’t just nice to have – it’s a competitive edge.
Learn more at Globally Minded, or reach out to Carrie directly at carrie@carrieregan.com to find out more.
Film commissions: Time to brag about your own incentive! We’re featuring Jurisdiction Spotlights like this in upcoming issues of Production Incentives Insider.
Just reach out at carrie@carrieregan.com, or via our website.