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Company formation in Cyprus is both tax-efficient and simple. That said, we advise all entrepreneurs considering incorporating in Cyprus to take into account the legal, accounting and tax regulations, prior to embarking on company formation in Cyprus. In particular, Healy Consultants staff can advise on all aspects of tax planning in Cyprus. Some of the most important legal, accounting and tax regulations include:
1.
Cyprus has one of the lowest corporate and personal tax rates in Europe at 10%. This fact is central to any tax planning in Cyprus for Cyprus resident companies or individuals.
2.
This corporate tax rate is levied on the net profits of all companies incorporated in Cyprus and any foreign company which conducts business, or has an office in, Cyprus. However, profits from the activities of a Cypriot company's permanent establishment situated outside Cyprus are 100% exempt.
3.
When tax planning in Cyprus, the company is deemed Cyprus-resident if strategic decisions about the company are made in Cyprus and/or if the majority of the board of directors members are resident in Cyprus for more than 183 days a year.
4.
Investors conducting tax planning in Cyprus should also note that interest on intercompany loans is also deductible for a Company, but not for a branch.
5.
Branch profits may be remitted to the head office free of withholding tax, following company formation in Cyprus. Tax planning in Cyprus should also take into account that corporate dividends are also exempt from withholding tax.
6.
Following company formation in Cyprus, dividends paid to a Cypriot holding company from a subsidiary are tax-free, provided investments constitute no more than 50% of the subsidiary's activities. When tax planning in Cyprus, dividends paid to an overseas shareholder of a Cyprus holding company are also not liable to pay withholding tax.
7.
After incorporating in Cyprus, the company may be liable to pay tax in the country in which it makes strategic decisions. Healy Consultants tax planning in Cyprus services also take into account the double taxation agreements Cyprus has signed with more than 40 countries.
8.
Tax planning in Cyprus is difficult because of the country's complex tax rules, despite the low corporate tax rates.
9.
Incorporating in Cyprus is simple. The country is a European Union member with a well-developed commercial and financial infrastructure, a stable government, economy and legal system.
10.
When tax planning in Cyprus, dividends, interest and royalty payments have no withholding tax with company formation in Cyprus.
11.
There is no capital gains tax with company formation in Cyprus.
12.
Company formation in Cyprus permits 100% foreign ownership.
13.
When incorporating in Cyprus, an International Business Company (IBC) cannot conduct business in Cyprus.
14.
Central to any tax planning in Cyprus strategy, Cyprus-resident individuals and corporations are taxed on global income.
15.
When tax planning in Cyprus, the company can set losses against future profits.
16.
When incorporating in Cyprus, a Cypriot company requires only one shareholder. When incorporating in Cyprus through an IBC, a corporate shareholder is allowed.
17.
When incorporating in Cyprus at least one director is required.
18.
The minimum issued share capital when incorporating in Cyprus is One Cyprus Pound.
19.
A Cypriot company is required to have a registered address in Cyprus when incorporating in Cyprus.
20.
Following company formation in Cyprus, a full set of annual accounts is required by the Cyprus Central Bank and Registrar of Companies. After incorporating in Cyprus, the company must submit accounts annually thereafter.
21.
Cyprus' reputable European jurisdiction makes it the ideal location for company formation.
22.
Healy Consultants can open corporate bank accounts in the jurisdiction of choice to support company formation in Cyprus. However, after incorporating in Cyprus, the Cypriot government may share information about EU nationals holding bank accounts in Cyprus with the account holder's tax authorities.
23.
Some entrepreneurs used company formation in Cyprus for holding and investment purposes.

Contact Us

For additional information on incorporating in Cyprus or tax planning in Cyprus, email email@healyconsultants.com or telephone us in Singapore at (+65) 6735 0120.


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