Cyprus at a glance

Cyprus at a glance

Cyprus is not only an excellent Jurisdiction for setting up your own business, but also to move permanently with your family. It is as peaceful and safe as it can get, with exceptional health and educational systems, English Language widely spoken, and an unpresented landscape of numerous blue flag beaches and high alteration ski resorts at the same time.  Lastly but not least, Cyprus is an ideal place for parents and their children, with low crime rates and a friendly society which fosters people of all nationalities to visit, live and work in Cyprus.

Attractive Tax System:

  • Low corporate income tax rate of 12.5%
  • EU & OECD Compliant
  • Access to EU directives (e.g. Parent-Subsidiary)
  • Extensive double tax treaty network with over 60 countries
  • Dividend participation exemption (subject to conditions)
  • Exemption from tax on gains from the disposal of securities (e.g. shares, bonds)
  • Notional interest deduction on equity applies to all taxpayers and all business activities
  • No withholding taxes on interest and dividends
  • No taxation of capital gains (except for disposal of real estate in Cyprus or shares of company holding real estate in Cyprus)
  • No succession taxes
  • Tax neutrality on foreign exchange differences unless they arise from trading in currencies or currency derivatives
  • Foreign tax relief on income subject to both Cypriot and overseas tax
  • Exemption on profits of foreign permanent establishments (subject to conditions)
  • Company reorganisation rules based on the EU Mergers Directive allow for tax-neutral group restructuring 
  • Attractive Intellectual Property regime in line with “modified nexus approach” (OECD Action 5)
  • No exit tax rules 
  • 50% exemption on employment income exceeding €100,000 per annum for non-residents taking up employment in Cyprus
  • No tax on dividends, interest and rental income of non-domiciled individuals

What it takes to get tax resident status in Cyprus:

According to the Income Tax Law of 2002, under the “183-day rule”, an individual who spends at least 183 days a year in Cyprus is considered a Cyprus tax resident. On 14 July 2017, the Cyprus parliament voted for a Cyprus tax law amendment adding a second test – the “60-day rule” – for the purposes of determining Cyprus tax residency for individuals.

To become a Cyprus tax resident on the basis of the “60-day rule” the individual must meet all of the following conditions:

  • Remain in Cyprus for at least 60 days during the tax year; and
  • Do not reside in any other single state for a period exceeding 183 days; and
  • Is not tax resident in any other state; and
  • Carry out business activities in Cyprus and/or work in Cyprus and/or be a director in a Company that is tax resident in Cyprus at any time of the tax year; and
  • Maintain a permanent residence in Cyprus.

Modern Legal Framework:

Cyprus’ competitive advantages are significantly enriched by a robust and transparent legal and regulatory framework and an attractive tax regime, which offers a wide range of incentives and advantages both for legal and natural persons.

Cyprus’ legal system, based on English Common Law principles, is widely recognised as a business-friendly and effective system that ensures transparency and reliability in business practices. Offering foreign businesses a familiar and reliable framework within which to operate, Cyprus’ legal system is also fully compliant with the EU, the Financial Action Task Force on Money Laundering (FATF), OECD, FATCA, the Financial Stability Forum laws and regulations and EU AML directives.

The island’s legislation provides for the doctrine of “non domiciled resident”, according to which all foreign nationals who choose to transfer their own tax residence to the island are entitled to use the applicable tax privileges and benefits for the next seventeen years.

Our company can help you structure your business and increase its tax efficiency, avoid double taxation and to be in compliance with the Cypriot statutory requirements.


4 Trooditissis street, Acropoleos tower, 3rd floor, 2012 Acropolis, Nicosia, Cyprus