Law and Taxes in Cyprus
Advantages in summary
- Recognition of operating expenses.
- Low corporate income tax rate
- Soft tax benefits in Cyprus.
- Losses can be carried forward for an unlimited period.
- Advance tax payments only on a voluntary basis.
- Tax on interest income
- No business tax
Tax advisor and lawyer
We have been working for many years with the satisfaction of permanent licensed law firms and tax advisors.
We would be very happy to recommend them with your request.
What is applicable in Cyprus?
Cyprus offers the most attractive corporate taxes within the European Union. Cyprus is best known for its low corporate tax rate.
At 12.5%, Cyprus has one of the lowest corporate tax rates in the European Union. Business taxes do not apply. For a Cyprus limited company to be taxable in the Republic of Cyprus, at least 50% of the directors must be resident in Cyprus. This requirement is formally met through the use of a Cypriot nominee director.
As a personnel service provider, we have specialists who are suitable for use as managing directors.
Tax benefits in Cyprus for companies with the business purpose "Intellectual Property" with an IP Box.
What is special about the Cypriot tax system and the administration in general is not only the almost unrivalled low tax rates, but above all the business-friendly environment. Bureaucracy is kept to a minimum, the authorities are comparatively quick in issuing tax numbers, VAT numbers and information, and even complicated problems can usually be solved with just a few discussions with the local authorities. There is very little corruption in Cyprus, and entrepreneurs can get what they want without paying any "extra fees" at all the authorities. At the same time, legal certainty is high and the political environment is permanently stable. Tax estimates by the tax authorities do not yet exist in Cyprus.
Capital Gains Tax and Defence Tax / Profit distributions to shareholders outside Cyprus are not subject to tax in Cyprus.
Interest earned in connection with the business activities of a Cyprus limited company is subject to 12.5% corporate income tax. Interest earned outside the ordinary course of business is subject to defence tax at 15%, which also applies to individuals subject to tax in Cyprus. Again, taxpayers who have non-dom status benefit from this.
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