Invest in Cyprus |

The Republic of Cyprus is a country-island, third largest island in the Mediterranean Sea after Sicily and Sardinia.

Cyprus is privileged to enjoy one of the most strategic geographical locations in the world. The island is situated at the crossroads of Europe, Asia and Africa and also forms a gateway to the oil-rich Arab states and the rest of the Middle East. It is, therefore, a convenient springboard for business activities in any of the trade centers in those areas.

The island shares the same time zone as other major centers in the area and is also within easy travelling distance to the rest of Europe and the Middle East. Cyprus became independent from the UK in 1960 and it is a democratic country with a free market economy, member of the United Nations, the Council of Europe and is a member of the British Commonwealth since 1961.

Cyprus became a member state of the EU in 2004 and has adopted the Euro currency in 2008.

Cyprus can claim with justification that has successfully been established as an international commercial and financial center. Cyprus has an effective mechanism of regulating and supervising the Banking system via the local regulatory monetary body, which is the Central Bank of Cyprus.

The Central Bank of Cyprus utilizes the directives and recommendations of the Basle Committee on Banking regulation, in order to reduce the systematic risk and maintain the stability of the Cyprus Banking system helping to preserve public confidence, protecting depositors at the same time.

In addition, permits have been issued to several International Banking Units and the Cyprus flag maintains its domain position in the International Shipping arena.


WHY CYPRUS?
Except from the location, there are other considerations. Other factors which contribute to the choice of Cyprus being one of the most attractive places in the world for locating or carrying out international activities are in brief:

  • Cyprus has the lowest fixed corporate tax rate (10%) in the European Union,  a very competitive V.A.T. rate (17%, as from 1st of March 2012) and all the additional benefit provided by the Cyprus tax law in relation to Dividends, Interest and Royalties make Cyprus companies more attractive in the following tax planning structures:
  • Tax Planning is offered to Cyprus tax residences enterprises through the extensive network of double tax treaties Cyprus ratified.
  • Highly-qualified local personnel are easily recruited.
  • A high standard of living prevails while Cyprus remains fairly inexpensive.
  • There is an efficient banking system based on the British banking system.
  • Professional services of a high standard are provided by lawyers and accountants.
  • The legal system is based on that of England most statutes regulating business matters are based on English Law.
  • The infrastructure is sound.  There are many new roads and many more under construction, making travel around the Island swift and trouble-free.
  • Excellent medical and health services are provided by general hospitals in all towns and a large number of private clinics whose charges are not high
  • Housing and office accommodation is of a good standard and readily available for renting at reasonable cost,
  • Education following the curricula of English, American, French and other schools, are readily available at the large number of private schools, including those which cater for Arabic and  Russian speaking peoples.
  • A typical Mediterranean climate with warm and sunny days. The island has beautiful beaches and cool mountains, many places of interest and lots of good food and wine.
  • People are friendly, there is no language barrier as the population is mostly bilingual with English as their second language.
  • Personal safety is assured and security of property is much higher than the norm in other European countries.
  • Flights between Cyprus and these countries are frequent, often being provided by the national carrier, Cyprus Airways which is a modern and rapidly expanding airline.
  •     The telephone system is fully automatic connecting directly with approximately 200 countries and visitors can bring along their mobile phones as Cyprus introduced the GSM service. The automatic telex service is nearly worldwide.
  • ·    Postal services are also of a high standard with air dispatches to many destinations being made daily. Courier services are, of course, also available in Cyprus
  • ·    Low operational costs. Repeated International surveys indicate that Cyprus has one of the lowest operational costs among the World's International Financial Countries.

·    Secrecy and confidentiality is secured in the ownership of shares in a company through the use of trustee companies being the registered owners of the shares, whilst the beneficial ownership is evidenced by the creation of a Trust Deed.

Tax Advantages

  • A flat tax rate at 12.5 % on taxable profits
  • There are no thin capitalization rules in the Cyprus tax legislation
  • One of the most favorable Holding company jurisdiction
  • Availability of Group losses relief without any time restrictions, under certain conditions
  • No withholding tax on dividends paid to non-residents shareholders
  • Exemption from taxation of capital gains apart from the disposal of immovable property situated in the Republic of Cyprus
  • A sophisticated network of double tax treaties in operation
  • Non resident companies are taxed only on the income derived in the Republic of Cyprus
  • Profit from disposal of  “Securities” which is defined as shares, bonds, debentures, founders’ shares, options on Securities, short positions on Securities, futures/forwards on Securities, swaps on Securities, depositary receipts on Securities (ADRs, GDRs), rights of claim on bonds and debentures (rights on interest of these instruments are not included), index participations only if they result on Securities, repurchase agreements or Repos on Securities, units in open-end or close-end collective investment schemes).
  • No taxation on dividend income. However this exemption does not apply if 50% of the income of company paying the dividend arises from investment income and the foreign tax levied on that company’s profit is significantly lower than the tax payable from the company receiving the dividend in Cyprus. In that case 20% defence tax is payable
  • Foreign tax levied on income of the company can be deducted on tax arising on the same income in Cyprus.
  • Cyprus does not impose any withholding tax on interest paid to non-resident recipients.
  • Profit from a permanent establishment abroad is not taxable.
  • VAT optional registration allowing them to claim back any VAT imposed on local expenditure and services offered
  • Salaries from services outside Cyprus for more than 90 days in a non-Cypriot resident employer or in the permanent establishment of a Cypriot resident employer are not taxed in Cyprus
  • Low income tax rates for expatriates
  • No inheritance tax


Other Advantages

  • Cyprus is a EU member state and compliant with EU laws and regulations
  • recognition of Cyprus as a mature international business centre with developed infrastructure, resilient economy, highly qualified professionals and minimum formalities
  • licensing in Cyprus and the existence of a regulatory framework improves transparency and legitimacy with regard to shareholders, authorities and others
  • a Cyprus fund can list easily on any stock exchange within the EU and benefit from “Single EU Passport” access to European Securities Markets legislation has been put in place and is constantly under review to regulate and harmonise operations in the international business sector
  • Cyprus enjoys sound reputation
  • Cyprus offers a pool of highly educated and qualified professionals who can advise clients and provide expert support