Offshore company formation in Cyprus
COMPANY FORMATION
Cyprus company formation
How do I incorporate a Cyprus company?
Company with management outside Cyprus – tax non-resident
The director of the company has to be a private person or company which are not a resident of Cyprus and the ownership (either private person or company) has to be foreign (outside of Cyprus). Business activity and source of income have to be outside of Cyprus, local borrowings to Cypriot companies are not allowed and all local payments must be registered and reported. Annual invoices and reports must be reported to the Central bank.
Company with management in Cyprus – tax resident
What are the key features of the Cyprus tax & main advantages of having a company in Cyprus?
- An International Business Company (IBC) will pay a tax of 12,5% on its net profits if it is a Cyprus resident. An IBC is a resident if its management and control are in Cyprus. Management and control are usually determined by the place of residence of the majority of the directors and the place where board meetings take place. Full advantage of the Cyprus double-tax treaty network can be obtained by resident IBCs
- A non-resident IBC will not be able to obtain a Cyprus Tax residence certificate and therefore cannot utilize the double-tax treaty network.
- Dividend income received in Cyprus by an IBC is wholly exempt from tax in Cyprus (under certain conditions).
- Profits from the disposal of shares are not taxable for all Cyprus tax residents.
- There is no restriction on the carry-forward of tax losses. They can be carried forward indefinitely to be set off against future profits.
- Organisation, amalgamations, mergers, and acquisitions of companies can be effected without any tax implications.
- No exchange control restrictions – an IBC can open a bank account in any currency in Cyprus and abroad.
- An IBC will pay zero tax if it is not considered to be resident in Cyprus. This will be the case when its management and control are outside Cyprus.
- There is no withholding tax on the payment of dividends, interest, and royalties by an IBC to non-resident individuals or companies.
- Profits earned from a permanent establishment abroad are fully exempt from corporation tax.
- 50% of interest received is exempted unless the interest arises in the ordinary course of business (e.g. interest on overdue debtor balances).
- Group relief is available whereby losses from a company can be set off against taxable profits of other companies in the same group.
- Exemption from capital gains tax (except on the sale of immovable property situated in Cyprus).
- Cyprus has 50+ Double Tax Treaty agreements that apply to 40+ countries and which can be exploited to minimize tax.
- Confidentiality and anonymity of beneficial owners are safeguarded (true identity is only disclosed to local banks, if a local account is opened and the information is not disclosed to any third party or to other countries, except in the case of properly authorized criminal investigation (drugs, terrorism, e.t.c.) or by a court order.
STEPS TO FORMING A COMPANY
What are the steps to forming a Cyprus company?
- Name of the company (2-3 names)
- Utility bill as proof of address (electricity, telephone, etc.) – Original
- The opening procedure is approximately 3 weeks (it depends on Cyprus Registry where the company docs will be certified, + 7 days).
- Copy of the passport (certified with Apostille) – Original
- Reference letter from the bank – Original
- Your payment to the Euro Commerce LLC bank account (To check out the formation fees please please see section Price List)
Opening an offshore bank account
We offer you the service of assisting in opening a bank account. For more information, please visit our Bank Accounts page.
Price List
| 1990€ | Opening fee |
|---|---|
| Apostille certification of all documents | |
| Registered office | |
| Company’s secretary | |
| Courier fee |
| 500 + 19% VAT EUR | Registered office |
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| Company’s secretary |
| + 350 EUR anually | Registrar of Companies |
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| + 500 EUR anually | Nominee director – corporate (this is not obligatory, it is for concealing identity purpose)** |
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| + 750 EUR anually | Nominee director – private person (this is not obligatory, it is for concealing identity purpose)** |
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| + 500 EUR anually | Nominee shareholder – private person (this is not obligatory, it is for concealing identity purpose) |
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| + 750 EUR anually | Nominee shareholder – corporate (this is not obligatory, it is for concealing identity purpose) |
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PITANJA
Frequently asked questions
The Republic of Cyprus is an island country in the Eastern Mediterranean and the third largest and third most populous island in the Mediterranean.
Cyprus is a presidential republic. The head of state and of the government is elected by a process of universal suffrage for a five-year term. Executive power is exercised by the government with legislative power vested in the House of Representatives whilst the Judiciary is independent of both the executive and the legislature.
The offshore regime in Cyprus has changed as part of the island’s accession to the EU, and as a result of agreements with the Organisation for Economic Cooperation and Development (OECD). Cyprus was excluded from the OECD’s June 2000 ‘harmful’ tax haven blacklist in return for pledging a commitment to amend its tax practices. In April 2009, Cyprus was placed on the OECD ‘white list’ of territories which have ‘substantially implemented’ the internationally agreed standard in tax transparency.
According to the Companies Law in Cyprus (Cap.113), Cyprus Companies (active and/or dormant) have to prepare Financial Statements (accounting) on the basis of the International Financial Reporting Standards (IFRS) within 18 months of incorporation.
Cypriot companies are required to have their financial statements audited by registered auditors in Cyprus.
Memorandum and Articles of Association in the official Greek language (English-certified translations are prepared by our firm)
Certificate of incorporation
Certificate of registered office
Certificate of directors
Certificate of shareholders
Cyprus has legislation in place to protect the privacy of offshore bank account holders, the owners of Cyprus trusts and Cyprus International Business Companies. Cyprus offshore companies or International Business companies are also awarded privacy per the companies’ legislation of offshore Cyprus. Company’s legislation allows for the registration of Cyprus offshore companies beneficial owners need not be filed with the Registrar of Companies. Company legislation allows for the incorporation of companies using nominee shareholders and directors. The names of the beneficial owners will remain private.
What our clients say
Call us and we will start the process of opening a company today or schedule a consultation if you have any doubts
