The establishment of a Cyprus company may, if structured correctly, offer a tax efficient way for businesses around the world to conduct their affairs internationally.

There are a number of advantages which should be taken into consideration and which will assist you in determining whether a Cyprus company is in fact the ideal corporate structure for your business, these include:

  1. The fact that the incorporation of a Cyprus company allows businesses to carry out their business activities in Cyprus and abroad at a very low corporate tax rate of 12.5% (among the lowest rates within the EU).
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  2. The registration of a Cyprus company may be achieved with 100% foreign shareholders, noting that Cyprus Company Law requires that a company has as a minimum, one shareholder and one director. Corporate shareholders and/or corporate directors are permitted, and they can be of any nationality, however, care should be taken to ensure that the company’s management and control is exercised in Cyprus.  The management and control principle is the only test for tax purposes.
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  3. Dividends paid to a company resident in Cyprus are exempt from corporation tax notwithstanding that such dividends emanate from a foreign (under certain circumstances) or a local company. There is also no withholding tax on dividends repatriated to a non-resident individual or corporate shareholder.
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  4. A Cyprus company can also benefit from more than 60 double tax treaties entered into between the Republic of Cyprus and other jurisdictions which include Greece, Russia, Poland, France, India, China, Singapore, Ireland, South Africa, the United Kingdom, the United States and Luxembourg, to name a few.

Dionysiou & Partners LLC (DP Law) can assist with setting up tax efficient structures and provide the subsequent management, administration and corporate secretarial legal services for the Cyprus companies used in such structures. DP Law can provide shareholders, directors, secretary and a registered office, as well as substance facilities and accounting services, through its strong network of affiliates, thus ensuring that clients that use the services of DP Law are fully compliant with all local and international regulations.

For further information, please contact Soulla Dionysiou at S. Dionysiou & Partners LLC at [email protected]

Article written by S. Dionysiou & Partners LLC