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How to start a business in Cyprus?

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Registering a company in Cyprus in 2020

Main advantages of doing business in Cyprus are:

  • A favorable territorial location;
  • The ability to exit the EU market;
  • The presence of agreements on the avoidance of double taxation;
  • Low tax rates in comparison with other EU countries;
  • The ability to receive some tax benefits.

A registration of business costs from 3490 €

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Before opening a business in Cyprus, read the material of this article.

After joining the EU, Cyprus opens up great opportunities for international entrepreneurs, who would like to register a Cyprus company. After opening a company in Cyprus, you will have access to a tax regime, aimed at optimizing taxes.

Advantages of establishing a firm in Cyprus
  • a corporate tax is only 12,5%;
  • no tax on dividends, on profits from trading in securities, from the sale of real estate abroad;
  • an income tax from intellectual property is 2%.
A legal form

You can open an enterprise in Cyprus of such type:

  • an Ltd;
  • a PLC;
  • an OJSC;
  • a GP;
  • a LP;
  • a branch of a foreign company.

The most popular form in Cyprus is Ltd.

Registering Ltd in Cyprus
  • First of all, you must register a unique name in the Register of Companies. A name may be presented in any language with a translation into Greek/English. “Limited” or “Ltd” should be mentioned at the end.
  • A min. number of shareholders is one, a maximum is fifty. Shares cannot be immediately put up for sale to the public, when opening a company in Cyprus.
  • Bearer shares are not permitted. A minimum value of each share is 1 EUR. Share denominations may be in EUR or any other international currency.
  • A minimum capital is 1 EUR. At the time of opening a Cyprus company, the tax is 0,6%, which is paid only once.
  • Shareholders of the company are liable for debts of the company only for the amount of their initial investment in a capital.
  • A minimum number of directors is 1. A maximum number of directors is not prescribed by law. Most directors must be local tax residents.
  • A secretary must be appointed.
  • Opening a bank account in Cyprus is possible in just a few days.
  • Financial statements must be submitted in the form of HE 32 once a year to the Register.

Please note: it is necessary to obtain a license in Cyprus, a registration of which takes from 5 working days.

Charter

A Charter is an agreement, that governs relations between shareholders, directors and a secretary. A Charter may be amended, that relate to:

  • Dividend payments;
  • Extraordinary shareholders meetings;
  • Voting rights on the Board of directors;
  • Rights of shareholders to change directors and secretary;
  • The company’s ability to receive loans and give loans to directors.
  • A company liquidation voluntarily or by court order.
Memorandum of Association

A MOA is an official document, that displays:

  • A company name.
  • A company line of business. Any activity, not included in the MOA, is an abuse of authority, therefore, it is invalid/disputed.
  • A registered office, that must be physically located in Macau.
  • MOA also indicates capital requirements.
  • Data of shareholders.
How to register a company in Cyprus?

If you want to establish an enterprise in Cyprus, you need to provide our lawyers with the following documents:

  • A registration certificate;
  • Photocopies of shareholders passports;
  • MOA and a Charter;
  • An approved name in the Register;
  • A bank statement.

If the shareholder/director is another company, then documents of such enterprise, its directors/shareholders/secretary are required.

Read also:

Please note: all documents must be executed in Greek/English, must be certified by a notary.

A taxation in Cyprus
  • A corporate tax is 12,5%, which non-residents pay on income, received in Cyprus, residents from all sources.
  • A VAT is 0-19%, (0% is used by exporters, 5% when selling products, medicines, books, 9% is paid by the owners of hotels, restaurants, transport companies);
  • An intellectual property income tax is 2%.
  • A tax to the Defense Fund is 3-30% (only residents pay).
  • A capital gains tax is 20% (it is paid, when selling real estate, shares).
Reporting

If you decide to set up a company in Cyprus, pay attention to a mandatory annual reports:

  • A tax return;
  • A financial report in Greek;
  • An annual report.

Mandatory requirements for registering Cyprus companies

  • any person, regardless of citizenship or place of residence, may be a director/shareholder;
  • shareholders can be individuals or legal entities;
  • the availability of a local registered office;
  • an appointment of a local secretary is mandatory.
Why should you open a business in Cyprus?
  • A success of Cyprus in a progressive legislation, a flexible tax system, a developed network of financial services. The Government of Cyprus is committed to providing access to highly developed markets.
  • Cyprus is the gateway to investment in the European Union, Eastern Europe, Asia and Africa.
  • It is a member of the EU, a European Monetary Union.
  • Qualified staff.
  • Access to an extensive network of double taxation treaties, that effectively structure tax investments.
  • Collective investments can be listed on the Cyprus Stock Exchange and other recognized EU exchanges.
  • Extended telecommunications network.

If you are interested in registering a company in Cyprus, you have the opportunity to realize an intention with IQD Consulting lawyers. Our experts will also help you to open a corporate account with banks in Cyprus, as well as to obtain a license in Cyprus. Use any form of feedback.

  • The information outlined in the article is actual at the time of its publication.

  • Please refer to our specialists for checking possible solutions for your business.

  • Still have any questions?

    Fill out the form or contact us as you find convenient. Our experts will help you resolve the issue.

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