Advantages of incorporating a company in Cyprus
General Conditions for Company Formations in Cyprus
- A wide choice of companies types for all purposes
- In most cases, only one founder – a natural or legal person – is required
- Share capital from 1 € only, depending on the type of company
- Low Corporate Tax Rate of 12.5 %
- => Ideal for holding structures in combination with other EU-jurisdictions
- => Ideal for holding structures in combination with offshore jurisdictions
- No taxes on dividends for non-residents
- No taxes on dividends for Non-Doms – exemption for 17 years
- No Gift or Inheritance Tax
- No restrictions on domicile and establishment of companies for EU citizens
- Residence permits available for non-EU-citizens
- Access to a highly educated workforce
- Functioning banking sector with multiple national and foreign banks
Ideal Tax Framework for Holding Companies
There are undeniable advantages to incorporating a company in Cyprus. Before the Republic of Cyprus joined the European Union, the former “offshore” regulations were abolished. Thus, the Cypriot legislation fulfills all relevant EU standards, EU regulations, OECD- standards, the FATF, and the FSF.
Cypriot companies are recognized throughout the European Union as EU companies with an extensive Tax Treaty Network. This circumstance is used mainly by holding companies. Cyprus nowadays has one of the most favorable Tax Regimes and competes within the EU with Ireland, Malta, the Netherlands, and Luxembourg at a split of the cost or with the UK as a NON-EU Jurisdiction.
Why not speak to us about the advantages of a holding structure?
What you need to consider
A long-term stay in a country for more than 183 days will usually (and automatically lead) to an unlimited tax liability for your world income. Some countries go even further and already assign this tax liability if you can permanently use your apartment (this can even be the room in your parent’s house or a regularly visited hotel), which you can access with your keys – known as “Schlüsselgewalt” in German-speaking countries. This rule establishes or maintains an unlimited Tax liability for your world income. If this subject interests you, you may find out more on our dedicated website for Taxation.
One can, therefore, only advise that people interested in relocating their place of residence not to rely on founding agencies – the pitfalls are too great, and sound advice is required. A few advisors (specialized lawyers, accountants) have studied tax law for years, and others do a weekend seminar or attend Google University – where do you feel better off?
It’s amazing what’s on offer on the internet. Believe us – there is no point in having no tax residency/residence anywhere. If in doubt, you never gave up your original tax liability (in your country of birth) or are automatically subject to tax through your passport. So if you have plans for company formations in Cyprus, we should discuss your relocation in detail.
TOP Jurisdiction for EU-Residence
Cyprus, however, offers ideal conditions for a tax residence because, unlike Malta or Ireland, a stay of just 60 days is sufficient to obtain tax residence in Cyprus. This is among the most significant advantages of incorporating a company in Cyprus.
Of course, you are not allowed to stay in any other country for more than 183 days which would trigger an unlimited tax liability there. This concept is, therefore, ideal for everyone who can live and work flexibly (e.g., digital nomads).
You can rely on well-founded and legally sound advice if you come to us. Together we will find your ideal life concept.
To receive a detailed offer or placing an order, please fill out the form down below for Company Formations and we will get back to you shortly !
Join our Corporate Finance Newsletter for monthly updates, best practices and product news.