Cyprus

Cyprus has double-taxation treaties with over 40 countries worldwide, including most of the high-tax countries in Western Europe, and many states in Central and Eastern Europe.

As a low-tax centre, Cyprus is a particularly effective location for companies aimed at emerging markets. In addition to this, the Cyprus economy is extremely strong and stable, and business costs are generally low.

Cyprus remains divided as a result of the Turkish Invasion in 1974, but this does not appear to have hindered the island’s economic development, at least not in the Greek sector. GDP per capita on the Greek side was $21,600 in 2005, among the highest in the Mediterranean. GDP in the Turkish sector was one-third of this.

The following forms of entities are the most popular to incorporate in Cyprus:
– Limited Company
– Branch
– Partnership

– No minimum share capital requirement
– Number of shareholders must be between one and fifty
– Company must have at least one director
– Annually audited accounts must be filed in Greek

– Foreign parent responsible for all liabilities of Cypriot branch
– Branch required to register with Registrar of Companies
– Accounts to be filed annually, in Greek

– General partnership: between two and twenty members
– Limited partnership: at least one partner with unlimited liability
– Required to register with Registrar of Companies
– No requirement for audited accounts, but must keep proper books

A company that is incorporated in Cyprus but not managed and controlled there is not considered to be a Cypriot tax resident. If this is true, the majority of the directors are expected to reside and hold board meetings outside of the country. Offshore companies that are incorporated in Cyprus but are not tax residents are subject to zero taxation.

As far a offshore companies are concerned the regulatory environment is far stricter than it was up to 2003. Before then, the Government applied the lightest of touches, and offshore companies paid no corporation tax at all. Today the island remains a business-friendly low-tax centre for those considering company registration.

The Corporation Tax rate currently stands at 12.5%, there are low treaty Withholding Tax rates, and its regulatory requirements are now on a par with many other EU states. Our legal and tax experts can help you negotiate the various regulations and give friendly help and advice on the many benefits of company formation Cyprus – contact us now.

Cyprus does not offer particularly generous incentives for foreign investors considering company incorporation in the country, although the government may argue that its low-tax regime is a sufficient incentive in itself.

However, various grants and loans are available for investors in certain traditional economic and high-tech sectors, and the Larnaca free trade zone offers exemption from customs charges. Moreover, there are personal tax concessions for expatriate workers.

Please contact us in order to discuss closing your company in Cyprus.

The economy has powered ahead in recent years, creating near-full employment and raising the stakes for foreign companies seeking to attract good staff. Having said this, the labour pool is generally well educated and rates of pay are low compared to the EU average. If you want the pick of the crop, our recruitment specialists are ready to help.

Cyprus is an important regional investment centre and has developed sophisticated international banking facilities to support it. Many major international banks have branches here, together with local commercial banks, and the financial system which is supervised by the Bank of Cyprus is robust.

For assistance with opening a bank account in Cyprus, please contact us.