Business entities in Cyprus in 2023

pay fee by instalmentsbusiness setup without travelGuaranteed solutions

Because of its attractive tax system, Cyprus is often a first-choice jurisdiction for the registration of companies aiming at trading with European Union customers and / or holding EU subsidiaries and other assets. The most commonly Cyprus business entity used is the limited liability company. Alternatively, foreign multinationals planning to conduct operations in Cyprus can also register a branch of their overseas office. See below for further information the different legal entities available in Cyprus.

  • Trading with a Cyprus entity

    The Cyprus Limited Liability Company (Limited Company)

    • It is possible to setup a Cyprus limited liability company with only i) one shareholder without a mandatory minimum capital contribution ii) one company secretary and iii) one director. Only the company secretary is legally required to be resident in Cyprus;
    • Entities managed from Cyprus are deemed as tax resident and hence subject to corporate income tax on their worldwide income, while those managed from overseas are only subject to corporate income tax on their Cyprus income. However, both resident and nonresident companies are required to submit their financial statements and a tax return each year to the Cyprus Tax Department;
    • Best uses for an Cyprus LLC: such entity is commonly used to setup an international trading entity, doing business with EU resident customers and suppliers.

    The Cyprus Free Zone Company (Larnaca Free Zone Company)

    • Foreigners can register their business in the only special economic zone existing in Cyprus, the Larnaca free zone, an industrial estate located near to the airport of the same name approximately 50km from the capital Nicosia;
    • The Government does not provide any more corporate holidays to businesses registered in the zone. The main advantages of the zone include i) subsidized industrial space and ii) good industrial infrastructure;
    • Transactions conducted from the free zone can also benefit from i) exemption from VAT for non-EU goods in transit ii) deferred VAT payment on merchandise imported into the EU;
    • Best uses for an Cyprus free zone company: light manufacturing activities of products re-exported to the rest of the European Union.

    The Cyprus Public Limited Company (Public Company Limited by Shares)

    • Minimum business setup requirements for a Cyprus public company include: i) 7 shareholders ii) 2 directors iii) a minimum capital of €25,000, of which at least 25% must be paid up before incorporation and iv) one company secretary, who is the only person required to be resident in Cyprus;
    • Cyprus PLCs are also required to i) appoint one auditor and ii) submit audited financial statements to the tax authority and the Cyprus Registrar of Commercial Entities every year;
    • Best uses for an Cyprus public limited company: registration of this business entity is recommended when the promoters intend to seek significant capital amounts from third party investors or list the company on the Cyprus Stock Exchange or another European stock exchange.
  • Trading with an overseas entity

    The Cyprus Branch Office

    • Foreign companies willing to do business in Cyprus can register a branch of their entity. Such registration will not require a minimum investment, but a resident country representative must be appointed;
    • Best uses for a Cyprus branch office: the main benefit offered by branch registration in Cyprus is the ability for the head office to prepare only one set of financial statements. However, the head office has also unlimited liability against any debt or loss of the branch office.

    The Cyprus Representative Office

    Cyprus regulations do not distinguish representative offices from branches. Consequently, representative offices are subject to the same business setup and annual filings requirements applicable to a branch office.

  • Holding assets with a Cyprus entity

    Click to view the holding company page.

  • Table of Comparison between Cyprus entities

      LLC Free zone company PLC Branch Holding company Offshore trust
    Locally known as? Limited Company Larnaca free zone company Open Limited Company Branch Holding company International trust
    Operations and logistics
    Doing business in Cyprus permitted? Yes Yes Yes Yes Yes No
    Allowed to sign contracts with local Clients? Yes Yes Yes Yes Yes No
    Allowed to invoice local Clients? Yes Yes Yes Yes Yes No
    Allowed to import raw materials? Yes Yes Yes Yes Yes No
    Allowed to export goods? Yes Yes Yes Yes Yes No
    Accounting and tax
    Corporate tax rate on local income? 12.50% 12.50% 12.50% 12.50% 12.50% Not allowed
    Corporate tax rate on foreign income if resident entity? 12.50% 12.50% 12.50% 12.50% 12.50% Not allowed
    Corporate tax rate on foreign income? (non-resident entity) 0% 0% 0% Always resident 0% 0%
    Statutory audit required? No No Yes Yes No No
    Annual tax return to be submitted? Yes Yes Yes Yes Yes No
    Access to DTAAs? Yes Yes Yes Yes Yes No
    Company law
    Issued share capital required? €1 €1 €25000 None €1 €1
    Resident director/representative required? No No No Yes No Yes
    Cyprus shareholder required? No No No No No No
    Minimum number of directors? 1 1 2 1 1 1
    Minimum number of shareholders? 1 1 7 Parent company 1 1
    Public register of shareholders and directors? Yes Yes Yes Yes Yes No
    Immigration
    Can the entity hire expatriate staff? Yes Yes Yes Yes Yes No
    How long to get work permit approved 3 months 3 months 3 months 3 months 3 months 3 months
    Engagement fees
    Estimate of engagement costs €9,635 Contact us €12,335 €11,705 €9,835 €15,585
    Draft invoice View invoice PDF View invoice PDF View invoice PDF View invoice PDF View invoice PDF View invoice PDF

Contact us

For additional information on our business setup services in Cyprus, please contact our in-house country expert, Ms. Lee Wen Bin, directly:
Consultant at HC - Wen Bin
  • Ms. Lee Wen Bin
  • Client Engagements Department, Deputy Director
  • Contact me!
Cyprus chamber of commerce and industry (CCCI) Government web portal of the Republic of Cyprus Cyprus tax department (direct taxation) - Cyprus inland revenue department Cyprus Investment Promotion Agency - invest in Cyprus (CIPA) Cyprus ministry of finance Central bank of Cyprus