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Cyprus is an independent country in the Eastern Mediterranean south of Turkey with a population of some 780,000. It is a full member of the EU and is also part of the Euro zone. Cyprus is a Common Law country. The Governing law is the Cyprus Companies Law, Cap. 113. Company formation generally takes 7 to 10 days from receipt in Cyprus of all required information.
WHY CHOOSE CYPRUS
Low rates of corporate tax (12.5%).
VAT rate 19%
Full EU member and therefore suitable for open trading with other EU states.
No withholding taxes on dividends.
Company formation generally takes 7 to 10 days from receipt in Cyprus of all required information.
A resident company
A Cyprus company needs a minimum of one director. For a resident company we normally recommend appointing a local (Cypriot) director.
A non-resident company
Non-resident companies should not have local directors and should not conduct any business from or within Cyprus.
Corporate Directors are not permitted.
It is acceptable to form a single member company i.e. one shareholder. Shareholders can be natural persons or corporate entities. It is good to use corporate shareholders that have bank account outside Cyprus in order to receive dividends.
The minimum paid up share capital does not need to be “shown” to the registrar prior to incorporation.
Cyprus has a number of double tax treaties in force with major trading partners and therefore Cyprus companies can be used as part of a tax efficient international structure.
The standard rate of corporation tax in Cyprus is 12.5% for resident companies, but is zero for non-resident companies.
For a resident company it is necessary to establish management and control in Cyprus; which is normally achieved by appointing a Cyprus resident director, and holding board meetings in Cyprus.
Nett profit is income less allowable expenses (general overheads, travel, salaries, consultancy fees etc). Cyprus also has a wide network of tax treaties, particularly with EU & CIS countries to avoid double taxation.
Dividends may be distributed to shareholders outside Cyprus without further taxation.
Accounts (locally referred to as Financial statements) do need to be prepared, audited and filed with the Inland Revenue in Cyprus. We offer all the necessary services e.g. bookkeeping, VAT registration and maintenance, accounting etc. and can arrange for audit with a local firm of Chartered Accountants.
The VAT rate in Cyprus is 19 %. The obligation for resident trading companies to register for VAT makes a Cyprus company an ideal vehicle for trading within the EU. We can arrange for your company to obtain VAT registration and provide book-keeping/accounting services to ensure compliance.
A Cyprus company can open a bank account almost anywhere in the world. We have links with a number of banks and can assist you with the opening and maintaining of bank account in Cyprus and worldwide.