Cyprus is the European Union’s fastest-growing technology hub.
Not only tech companies benefit from Cyprus’s business and lifestyle advantages. Many international companies that do business in Cyprus, the Eastern Mediterranean region, or globally consider Cyprus to be a stronghold.
A growing number of international corporations are choosing Cyprus as their regional or global headquarters.
Cyprus corporate structuring remains one of the country’s areas of specialisation. Corporate and tax advisors continue to establish Cyprus companies such as Cypriot holding companies, Cyprus investment companies, and Cyprus headquartering companies to channel investments into key global markets. Cyprus’s stable financial environment, combined with its advantageous tax system, has made Cyprus a primary destination for structuring investments in Europe, the Middle East, and Africa.
Cyprus’s tax regime is one of the most appealing and transparent in Europe, fully complying with EU laws and regulations.
Foreign companies have the option of establishing their headquarters in Cyprus. Cyprus, as a member of the European Union, enjoys free movement of goods, services, and capital.
Cyprus tax advantages that Cyprus tax regime offers to Cyprus companies and to those companies choosing Cyprus as a place of headquartering
Cyprus, for those choosing Cyprus as their point of headquartering offers various tax advantages due to its tax system.
- Cyprus Company enjoys a simple, transparent, and harmonized EU tax system in line with OECD practices
- Cyprus Company enjoys the tax benefits of EU directives (EU Parent-Subsidiary Directive, EU Merger Directive, and Interest and Royalties Directive)
- Cyprus companies enjoy an extensive Cyprus double tax treaty network with the rest of the world
- Availability of Cyprus Notional Interest Deduction – NID for Cyprus companies receiving new equity financing. The Cyprus tax deduction for Cyprus Companies can reach up to 80% of the Cyprus Company’s taxable income generated by the new equity
- Cyprus IP Box – Cyprus Intellectual property regime for Cyprus Company based on the Nexus approach that allows an 80% imputed deduction on qualifying profits from the business use of qualifying intellectual property – IPs. The exemption from four-fifths of profits means only 20% of the IP revenues are taxed at a corporate tax rate of 12.5%. Following the calculations, Cyprus companies can enjoy an effective Cyprus tax rate as low as 2.5% – the lowest in Europe. Cyprus offers substantial intellectual property (IP) protection through domestic law and a network of EU and international agreements.
- Attractive Cyprus tonnage tax (TT) scheme for shipowners, managers, and charterers
- The attractive tax regime for Cyprus funds and an attractive tax regime for Cyprus fund managers
- Capital gains are exempt from Cyprus taxation (excluding capital gains arising from the sale of immovable property located in Cyprus)
- Profits of a foreign Permanent Establishment are exempt from tax
- Securities trading proceeds (stocks, bonds, and certain other financial instruments) are exempt from Cyprus tax
- Unilateral credit relief is granted to Cyprus companies for foreign taxes in Cyprus
- No withholding tax on dividends paid by a Cyprus company, interest, or royalty payments (for use of royalties outside Cyprus) made abroad
- There are no taxes on entry into qualifying reorganisations.
- There is no inheritance tax in Cyprus.
- There is no immovable property tax in Cyprus