The income tax treaty between Cyprus and Iran entered into force on 5 March 2017. The treaty was signed on 4 August 2015. The treaty generally applies from 1 January 2018.

Under the treaty, the withholding tax on dividends is 5% if the beneficial owner is a company (other than a partnership) which holds directly at least 25% of the capital of the company paying the dividends; or 10% in all other cases. Withholding tax on interest is 5% and royalties is 6%.