There are two fundamental expectations from Cloud-IoT applications using sensitive and personal data: data utility and user privacy. With the complex nature of cloud-IoT ecosystem, there is a growing concern about data utility at the cost of privacy. While the current state-of-the-art encryption schemes protect users’ privacy, they preclude meaningful computations on encrypted data. Thus, the question remains “how to help IoT device users benefit from cloud computing without compromising data confidentiality and user privacy”? Cloud service providers (CSP) can leverage Fully homomorphic encryption (FHE) schemes to deliver privacy-preserving services. However, there are limitations in directly adopting FHE-based solutions for real-world Cloud-IoT applications. Thus, to foster real-world adoption of FHE-based solutions, we propose a framework called Proxy re-ciphering as a service. It leverages existing schemes such as distributed proxy servers, threshold secret sharing, chameleon hash function and FHE to tailor a practical solution that enables long-term privacy-preserving cloud computations for IoT ecosystem. We also encourage CSPs to store minimal yet adequate information from processing the raw IoT device data. Furthermore, we explore a way for IoT devices to refresh their device keys after a key-compromise. To evaluate the framework, we first develop a testbed and measure the latencies with real-world ECG records from TELE ECG Database. We observe that i) although the distributed framework introduces computation and communication latencies, the security gains outweighs the latencies, ii) the throughput of the servers providing re-ciphering service can be greatly increased with pre-processing iii) with a key refresh scheme we can limit the upper bound on the attack window post a key-compromise. Finally, we analyze the security properties against major threats faced by Cloud-IoT ecosystem. We infer that Proxy re-ciphering as a service is a practical, secure, scalable and an easy-to-adopt framework for long-term privacy-preserving cloud computations for encrypted IoT data.