- Corporation tax of 12.5% in Cyprus is one of the lowest in the EU. In addition, correct structuring and planning of operations (with respect to use of “reasonable” deductible expenses and other specific tax benefits) helps minimize further the tax bill of Cyprus International business entities to a small fraction of the turnover of the company.
We have thorough understanding of the Cyprus tax system and will be glad to help you structure your operations in advance in order to minimize the tax charge in the most efficient way and avoid tax risks in the future.
- The taxation approach in Cyprus is far less strict than in other European countries. Structuring errors and other deficiencies in tax planning can in many cases be overcome or mitigated after these problems have been identified.
With this regard, we can always help you with identification of tax risks and finding ways to mitigate them at any stage of your project. However it is advisable that proper planning is applied in the start-up phase in order to avoid such problems which might result in significant administrative time and cost if identified in a later stage of the company’s life cycle.
- There is no capital gains tax in Cyprus except for one arising on gains from disposals of real estate located in Cyprus. It is worth noticing though that if we deal with foreign real estate, capital gains tax will arise in the country where the property is located. Also gains arising on disposals of financial instruments (shares, bonds, futures, etc.) do not normally give rise to tax liability (subject to a limited number of exceptions, i.e. currency futures, currency swaps, options with underlying assets being commodities, etc.).
We will certainly consult you whether your activity may give rise to capital gains tax liability.
- Cyprus is an EU jurisdiction with significant history of specialization on non-resident business as well as clear and unsophisticated requirements and “Rules of the Game”. It is supported by developed infrastructure and pool of related services, banking, investment, legal, etc.
We will guarantee you access to the full spectrum of services encompassing Cyprus jurisdiction and provide you the service in English or Russian (based on your choice).
- Cyprus provides a straightforward beneficial scheme for becoming Cyprus tax resident for citizens and tax residents of various countries. It may be sufficient under the circumstances to stay in Cyprus two months per year in order to hold the residency.
Cyprus tax residence gives rise to an additional tax benefit for “new” Cyprus tax residents – at least 17 years of non-taxable dividend and interest income!
We will help you get the full benefit out of this scheme while enjoying your full convenience! First of all, you will get full information of the benefits that apply in your personal case. Second of all, you will get a personalized solution and steps to be done. Finally, you will be accompanied in all offices (including bank and migration office) where your presence is needed in order to help you satisfy the requirements for tax residency as soon as possible.
- A company registered in Cyprus, being an EU state, has a better chance than any offshore company for a bank account opening not only in Cyprus, but also in many other countries.
In addition, Cyprus jurisdiction is a good choice if you want to show “substance” in the company, i.e. reasonable signs that the company is managed and controlled in Cyprus (rather than from abroad). Office rents are relatively low and employees are easily available.
We will help you open a bank account for your Cyprus-registered company and stay in direct communication with your banker in order to make your day-to-day work with bank as smooth as possible. We will also gladly help you find a reasonable and inexpensive office for rent as well as arrange for an employee, prepare employment contract, make all necessary registrations so that you get the degree of “Substance” requested in no time.
- Cyprus is a country where getting a VAT registration number is straightforward and fast and normally takes a couple of business days. Sales of services provided by Cyprus companies (1) outside of the European Union, or (2) to the EU clients who are registered for VAT, are not subject to VAT.
We will help your Cyprus company register for VAT (and if necessary, for VIES) fast, prepare and file all VAT reports for your company and ensure that it stays fully in line with legislation requirements.
- A major list of procedures and documents necessary for company administration can be executed within reasonable time without much red tape. For instance, company certificates from Registrar can be obtained within one or two business days and be apostilled the same day.
We will do our best in order to ensure that your orders are completed on time and will control the local authorities for the same reason.
- In Cyprus, there are still not strict rules and harsh penalties for minor incompliance with various legislation requirements, e.g. late filing of financial statements and tax returns.
We will help you keep your accounts and returns up-to-date. In addition, we will be in position to prepare for you management accounts for any reporting period needed or keep your book-keeping in online ready regime when such a need arises.
- In spite of transfer pricing rules adopted by the Cyprus tax legislation, the benefit of Notional Interest Deduction (NID) helps Cyprus companies stay to be among most attractive vehicles for financing foreign businesses. As long as the amount financed is “taken” from the paid up capital and premium of the Cyprus Company, the effective tax rate on the loan interest income will amount to 2.5% only (assuming no expenses, should the company have expenses that are wholly and exclusive for the purpose of generating taxable income the effective tax is further reduced and could end up on approximately 1-1.5%).
In our approach we continuously pay attention to the ways that our clients conduct and structure their business. With this regard, we are always alert to spot opportunities that can be used by the client to reduce the tax burden, be that the NID solution or other legally acceptable options.