Cyprus: An Excellent European Option For International Trade For Those Looking For A Sound Solution To International Developments
Contributed by TBA & Associates
29 November, 2019
Over the last few years the worldwide international business sector has experienced unprecedented changes, which have totally reshaped the landscape.
There have been huge developments on many different fronts, from FATCA to CRS and from BEPS to "deoffshorisation" and to the substance-related amendments in the Parent-Subsidiary Directive plus the introduction of the fourth EU AML Directive with its requirement for registries of beneficial owners, to name but a few.
Concepts such as substance, transparency and compliance are having a prominent role in the new era of international investments and business operations.
Cyprus has chosen not only to fully adjust but also to lead the way to the modern international business world. To do that it is taking advantage of the number of its existing advantages, such as the flexible legal and tax regimes, its competitive Corporation Tax rate, its geographical position, its top-class citizenship and residency schemes and standard of living. On top of that it has recently introduced, some very important measures, which will help even further in achieving its goal, including a "non-dom" regime, exemptions from taxes and other duties for investing in real estate, a tax-deductible charge on equity and many other.
In essence, Cyprus offers a great number of reasons why foreign investors and businessmen should not only invest in the country or simply add it on the diagram of their international business structures, but also to relocate to the country and transfer their business activities here.
By doing so, not only will they be in line with the new trend, but they will also meet other important objectives, such as good returns on investments, ease and cost-efficiency in doing business and having the lifestyle of their choice.
25 Great Advantages A Cypriot Company Can Offer You!
Find out all major benefits and advantages a Cyprus company can offer you and not only Tax Advantages
- A Company in Cyprus can be registered in approximately 5 working days.
- The cost of incorporation is very low; our Limassol offices offer you 2 Special Company Packages, Business and Premium, at highly attractive prices.
- You can get a new company certificate such as a Certificate of Incorporation or a Good Standing Certificate, the same day; and in English and Apostilled.
- Use of a Nominee Director and Shareholder is allowed, for full confidentiality and anonymity.
- The share capital of the company does not have to be fully paid in cash at the time of incorporation. You can pay it up later at any stage.
- It is an EU company, and as such it is acceptable by all countries and serious companies in the EU, and of course all over the world.
- Its annual corporate and maintenance costs are very low; we offer a very comprehensive management package which includes administrative, legal and accounting services.
- You can open a bank account for a Cyprus company in any country you want.
- You can get an EU Vat registration number in 48 hours.
- In case you decide to appoint Nominees, you can have a full Power of Attorney to carry out all or any of the Company's operations you want.
- You can incorporate the company without having to visit Cyprus even if you are going to be a Director yourself.
- You can have a virtual office in Cyprus as the business headquarters of the company, dedicated telephone line, fax, email account and office space to meet clients.
- You can close a Cyprus company with a very simple procedure.
- You can operate a Cyprus company remotely, from the comfort of your office in your own country.
- A Cyprus company pays only 12.5% tax on its net profits, if generated within Cyprus, otherwise its corporate tax is 0%. Cyprus is a low tax jurisdiction not a Tax Haven.
- A Cyprus company pays 0% tax on dividends paid out to the shareholders.
- A Cyprus company pays 0% tax, on all dividends received from any of its subsidiaries.
- Cyprus does not impose income or capital gains on profits and gains derived from the disposal of securities, irrespective of whether the profits and gains are of revenue or a capital nature! (*)
- Cypriot companies are exempt from taxation on foreign exchange (FX) gains, except for FX gains arising from trading in foreign currencies and related derivatives!
- A Cyprus company pays 0% on all profits by operating any permanent establishment abroad, such as a hotel, a chain of restaurants, shops etc.
- A Cyprus company pays only 2.5% tax on all profits from possession or trading in Intellectual Property rights, such as patents, trade names, trademarks, music or sports or scientific rights etc.
- Incorporation of a Cyprus company gives the right to the Real Owner and his family members to a long stay visa for two years (renewable) and work permit. In 7 years to a Cyprus â EU passport!
- A Cyprus company can be re-domiciled abroad to any other country.
- A Cyprus has signed dozens of Double Taxation Avoidance Treaties all over the world.
- If you need to settle in Cyprus, you will enjoy a beautiful country with a mild climate, no crime rate, hospitable population, plenty of human recourses for your needs, a fantastic cuisine and tasty fruits and vegetables.
(*) Securities, as defined in the law, include shares, bonds, debentures, founder's shares and other securities of companies or other legal persons and options over such securities.
The Use of the Cyprus International Trading Company in International Tax Planning
Cyprus as a well-established international centre has been critically assessed as constituting an attractive location for international trading companies from a tax perspective, among others. This is due to the enactment of the new Cyprus tax legislation, which is now compatible with the "acquis communautaire". Cyprus laws and practices are now harmonized with the EU Laws and Directives, the Code of Conduct and the Organization for Economic Cooperation and Development's recommendation on Harmful Tax Corporation, and more over its tax exemption on all incomes generated outside Cyprus.
New Tax Legislation
A uniform 12.5% corporate tax rate, applicable to the worldwide income, is now levied on all resident companies. This is the lowest corporate tax rate in the European Union and thus the most advantageous standard rate of corporation tax for Cyprus.
The new taxation status on Company is residence-based. A company is only 'resident in the Republic' if its business is centrally managed and controlled in Cyprus.
Therefore, under the new rules, a resident corporation is taxable on its worldwide income accrued or arising from sources both within and outside Cyprus if it is managed and controlled from Cyprus.
In view of the new tax legislation, also its Holding International Business Companies operating from Cyprus are now in a much more beneficial position because they can enjoy the benefits deriving from the tax exceptions as well as the corporate tax benefits by virtue of the new tax legislation.
Should you have any question or matter you would like to discuss or clarify with us, or should you like to receive full information report on this jurisdiction, contact us now!
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