Cyprus: Offshore Legal and Tax Regimes
Employment and Residence
NB: Following Cyprus's accession to the EU, citizens of EU Member States are evidently exempt from local Work Permit rules, although it is taking some time for the bureaucracy to get used to this new situation. The rules outlined below now apply only to non-EU citizens.
The employees of offshore entities in Cyprus require 'Temporary Work and Residence (TRE) Permits', which are issued by the Central Bank. For this purpose, employees are categorized either as Executives or Non-Executives.
In effect, Executives are defined as senior management, and three only of them are permitted unless the Central Bank can be persuaded otherwise. The minimum age for an Executive is 24, and the minimum salary is CY£12,000 pa.
Non-Executives are those foreigners employed in managerial, professional, administrative, technical and clerical positions. The employer must make an effort to recruit suitable local personnel. Permits are issued by the Ministry of Labour.
In both cases, a fair amount of documentation is required by the authorities. Permits are normally issued for 2 years, renewable for a further three years.
Under a law implemented in July 2000, foreigners to Cyprus must either have a five-year work permit or have worked on the island for five years or have a combination of worked time and work permit totalling a minimum of five years before their spouses can join them.
But in November 2000, the Cyprus government introduced new regulations designed to make it easier for some foreigners to have their loved ones live with them. However, this solely applies to those EU nationals and non-Cypriots who work in certain sectors which are: offshore workers, reporters, foreign correspondents, accountants with big firms, lecturers, teachers and those who have invested more than CY£100,000 in local businesses.
The five-year permits will be automatically granted to new foreign entrants into these sectors and those renewing permits will be given extensions long enough to enable them to meet the 'five years in total' clause.