Significant changes to the Cyprus child benefit system are included in a new bill submitted to Parliament, with higher income thresholds, increased payments for lower-income households and new rules for families whose earnings exceed the specified limits.
Speaking on Sigma’s Protoselido programme, senior welfare benefits management officer Phanos Kouroufechis said the changes are particularly important because eligibility for child benefit also provides access to a range of other state benefits.He explained that families which become or remain eligible can receive other forms of support, including significant subsidies towards nursery fees, averaging around €200 per month.
Income thresholds rise significantly
One of the main changes to the Cyprus child benefit scheme is a substantial increase in income thresholds, which Kouroufechis said would rise by around 40% across the different categories.For a family with one child, the income threshold will increase from €49,000 to €69,000, a rise of €20,000.For families with two children, the threshold will increase from €59,000 to €74,000, while the limit for three-child families will rise from €64,000 to €90,000.Families with four children will see the threshold increase to €100,000.Kouroufechis said the higher limits would considerably broaden the number of families able to qualify for the benefit and, consequently, other forms of assistance linked to beneficiary status.
Payments to increase by up to 10%
The bill also provides for increases in the amount families receive, particularly among lower-income groups.Kouroufechis said payments would rise by around 10% for the lowest income categories, describing it as a significant increase.He also noted that benefit amounts are adjusted annually in line with the consumer price index.
Families will no longer lose everything over €1
Kouroufechis described another provision in the bill as perhaps its most important change, despite receiving less public attention.Under the current system, families can lose their entire benefit if their annual income exceeds the applicable threshold, even by a very small amount.He gave the example of a two-child household with an income threshold of €59,000. A qualifying family could receive around €1,500 a year, but an annual income of €59,001 would result in the loss of the entire payment.”This €1 difference. The €1, the €10, the €100, whatever it was. This is now changing,” he said.Under the proposed rules, exceeding the relevant income threshold will no longer automatically remove a family’s beneficiary status.Instead, the amount paid will be adjusted downwards using a coefficient. The family will therefore receive a smaller payment while remaining eligible for the Cyprus child benefit and the additional benefits connected to it.
Some families took unpaid leave to remain eligible
Kouroufechis said the existing system had led to cases in which families adjusted their working arrangements to avoid crossing the income threshold.The consequences could be particularly significant for larger families, where annual child benefit payments can reach much higher levels.”For four children, it can be €10,000,” he said.He said officials were aware of cases in which people took unpaid leave for a period so their annual income would remain below the threshold, rather than risk losing thousands of euros in benefits after marginally exceeding it.Maintaining beneficiary status is particularly important because eligibility can provide access to other support, including nursery subsidies, special discounts, school-related benefits and transport assistance.In some cases, Kouroufechis said, the financial value of the nursery subsidy itself could be greater than the child benefit payment.
New rules expected from January 2027
Kouroufechis said he expects Parliament to give the bill priority, based on how similar measures that positively affect households have previously been handled.If approved, the changes are expected to take effect from 1 January 2027 and apply to applications submitted from 2027 onwards.The reforms would therefore expand the number of households eligible for Cyprus child benefit while also replacing the current cut-off system with a gradual reduction for families whose income exceeds the new thresholds.
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