POPULAR TAX STRUCTURES:

• Cyprus Holding Companies
• Cyprus Trading Companies
• International Trusts
• Cyprus Companies acting as Directors
• Cyprus Companies used as Vehicles for Intellectual Property Rights
• Cyprus Companies Trading Securities
• Cyprus Investment Firms (Forex companies)

 

Cyprus holding companies

Cyprus is an attractive jurisdictions for holding companies for a number of reasons:

• Tax Free Dividends received and paid
• Group Loss Relief (Cyprus companies only)
• No Withholding Taxes
• Relaxed Tax System

 

Other tax considerations:

• Lowest Tax Rate in EU, 12,5% corporation tax
• Full Exemption from Tax on Disposal of Subsidiary
• No Tax on Liquidation of Cyprus Holding company

 

These are achieved through:

• Cyprus’s extensive Double Tax Treaty network (more than 60 double tax treaties)
• EU Parent Subsidiary Directive
• Part of EU and Eurozone

Cyprus Trading Companies

Cyprus is one of the most attractive jurisdictions for trading companies, for a number of reasons:

• Lowest Corporation Tax rate in Europe at 12.5%
• Majority of Expenses are Allowable
• Low Set Up Costs (for substance)
• Great Infrastructure (roads, government buildings, transport)
• English Language is commonly spoken by all residents

 

Other tax considerations:

• Full exemption from tax on disposal of subsidiary
• No tax on liquidation of Cyprus Holding company
• Payroll expenses are low so as the payroll taxes

 

These are achieved through:

• Cyprus’s extensive Double Tax Treaty network
• EU Parent Subsidiary Directive
• Part of EU and Eurozone
• Cyprus features on the white list of the Organization for Economic Co-operation and Development (OECD)

 

International Trusts

International trusts play a major role in various tax planning solutions either to wealthy individuals or to corporate group structures. Amongst other our firm offers discretionary trusts, fixed trusts & trading trusts.

 

Some of the benefits of using such trusts are the following:

• Protection again high taxation
• Confidentiality
• Holding of Property, Company or Group of Companies
• No Reporting Requirements
• Inheritance Purposes (precluded persons)
• No Exchange Controls
• No Restrictions on Jurisdiction Change

 

Cyprus Companies Acting as Directors

Cyprus Companies (Limited Liability Companies) are commonly used as directors to international single entities or international tax structures for many reasons:

• Confidentiality of the Ultimate Beneficial Owner (UBO), however a UBO register is in force since 2023/2024.
• Protection of the Ultimate Beneficial Owner as the Cyprus company used is limited liability; i.e. it can be closed without implications to the shareholders & ultimate beneficial owners
• Low Company Maintenance Costs
• Governed by Common Law (in Cyprus we follow the Anglo-Saxon system)

 

Other tax considerations:

• If the Company acting as director is dormant then it will pay 0 taxes
• If the Company acting as director trades, then it will be taxed at 12.5% Corporation Tax
• Dividends to its Ultimate Beneficial Owner are entirely tax free.
• Majority of Expenses are Allowable for tax purposes

 

Cyprus Companies used as vehicles for Intellectual Property Rights

We provide a wide range of services on Intellectual Property rights including the registration of trademarks (figurative and word marks), the validation of European Patents in Cyprus, registration and protection of industrial designs, the protection of copyrights and the registration of domain names.

Cyprus is chosen by many international clients as it offers the most competitive tax rates in combination with the low legal fees for the creation of such rights.

Cyprus Security Trading Companies

Security trading companies find Cyprus very attractive as disposal of securities in Cyprus is tax free. This major factor coupled with the below tax and other benefits do make Cyprus a very attractive destination for Title Trading Companies:

• Low Set Up Costs (for substance)
• Great Infrastructure (high quality of living, new roads and governmental buildings, excellent transport)
• English Language is Commonly Spoken by All Residents
• Payroll Expenses are Low so as the Payroll Taxes

 

Other tax considerations:

• Lowest Corporation Tax Rate in Europe:
• 0% Tax for the disposal of securities, and
• 12.5% on taxable income of other trading or financing activities
• Majority of Expenses are Allowable

 

These are achieved through:

• Cyprus’s Extensive Double Tax Treaty Network
• EU Parent Subsidiary Directive
• Part of EU and Eurozone
• Cyprus features on the white list of the Organization for Economic Co-operation and Development (OECD)

 

Cyprus Investment Firms (CIF)

We provide a wide range of services on Intellectual Property rights including the registration of trademarks (figurative and word marks), the validation of European Patents in Cyprus, registration and protection of industrial designs, the protection of copyrights and the registration of domain names.

Cyprus is chosen by many international clients as it offers the most competitive tax rates in combination with the low legal fees for the creation of such rights.

 

Reasons for Setting Up a Cyprus Investment Firm (CIF):

• Relaxed Regulation in Relation to other EU jurisdictions
• Lowest Corporation Tax in Europe at 12.5%
• Low Set Up Costs (office overheads)
• Available, High Calibre Workforce
• Great Infrastructure (roads, government buildings, transport)
• English Language is commonly spoken by All Residents
• Payroll Expenses are Low so as the Payroll Taxes

 

Auxiliary Services

• Safekeeping and administration of financial instruments, including custodianship and related services
• Granting credits or loans to one or more financial instruments, where the firm granting the credit or loan is involved in the transaction
• Advice to undertakings on capital structure, industrial strategy and services relating to mergers and the purchase of undertakings
• Foreign exchange services where these are connected to the provision of investment services
• Investment research and financial analysis or other forms
• Services related to underwriting

Registration time: Application process normally takes around 6 – 8 months.

 

Advantages of Cyprus Companies Structures

• Asset Protection
• Zero Tax on Dividends
• Tax Minimisation at 12.5% only
• EU Law application hence strong legal protection
• Trade Advantages within the EU
• Banking Freedom

Disclaimer: The information provided in this article is for general informational purposes only and should not be construed as legal or tax advice. Please consult with a professional tax advisor for advice on your specific situation.

CYAUSE AUDIT SERVICES

CYAUSE Audit Services is a regulated Audit & Assurance firm with offices in Nicosia and Limassol. During 2015 we have been awarded by I.C.P.A.C and the A.C.C.A (local and international association of Chartered Certified Accountants) for the Quality of our Audit Services and our Office's Procedures.

Our firm has been helping overseas companies create Cyprus structures for many years as well as helping overseas groups or entities and businessmen relocate to the Republic. The attractive taxation benefits coupled with the amazing lifestyle make Cyprus truly a winning contestant in the international tax planning arena and our role is to help. If you are considering relocating to Cyprus or having a Cyprus entity set up, feel free to contact me directly for a free one to one consultation at kt@cyprusaccountants.com.cy.

Being a Truly International Audit & Assurance firm, we have associates from all over the world and we are constantly looking for new associates to expand our network further. At present, CYAUSE Audit Services operates internationally as Accace Circle, a co-created business community of like-minded BPO providers and advisors who deliver outstanding services with elevated customer experience.

Our network covers almost 40 jurisdictions with over 2,000 professionals, it supports more than 10,000 customers, mostly mid-size and international Fortune 500 companies from various sectors, and processes at least 170,000 payslips globally.

CYAUSE Audit Services Ltd is also a member of BKR International, an american accounting and advisory association and the 3E Accounting Network, an international accounting network which originates from Hong Kong and has more than 80 members from all over the world.

Contact Us

If you would like us to assist you with your investment firm or fund please contact us at enquiries@cyprusaccountants.com.cy or call us at +357 22 336 309.