To answer this question, we need to do some research and analyze the business market in Cyprus. Cyprus is an island country in the eastern part of the Mediterranean Sea. It is a country with rich history, culture and architecture. It is considered one of the tourist countries and it’s not surprising because one of the main items of national income is tourism. More information about this wonderful country can be found here: https://en.wikipedia.org/wiki/Cyprus. Such conditions promote the development of various forms of business, but it is necessary to take into account the taxability and legal regulations.
Cyprus is one of the most popular places for opening a new business because the tax rate here is lower than in most European countries. It’s also a good option for entrepreneurs who intend to open a business in a place where it’s easy to find investors interested in investing their capital. The climate here is favorable in the literal and figurative sense, as there is a huge tourist area, which offers great opportunities, and the bonus is that it is a place with loyal conditions for doing business. Any company registered in Cyprus is subject to state registration and is obliged to submit financial reports and regular shareholders meetings. Cyprus has a low income tax rate and a flexible legal system make this jurisdiction favorable for starting a new company. Let’s analyze in detail below the advantages of opening a firm in Cyprus:
After the list of advantages of opening your own firm in Cyprus, most questions will fall away, but not all. Therefore, let’s consider in detail the important part when starting a business in this or that country such as taxes.
In fact, there are plenty of ideas for starting your own business. The main thing is to let yourself go in a flight of fancy and continuously look for new ideas, sort and assess your options and future prospects.
Cyprus is a tourist country, so you can take tourists as the target audience.
Cyprus can be a great place to start your own business. It opens up a huge opportunity to develop a firm. The favorable conditions, many prospects and other advantages will help in this.
The tax system of Cyprus is quite friendly to foreign entrepreneurs who have decided to start their business here.
Like every country, Cyprus has its own peculiarities which must be studied in advance. Tax residency status is confirmed by a special certificate. This document is necessary to avoid double taxation. Therefore, the director and the management are obliged to be based in Cyprus in order to avoid unnecessary problems. Taxes to be paid are described in the table below:
Tax | Application |
Income tax | 12.5% is charged regardless of where and how the profit is made. |
Withholding tax | 10% applies only in case of businesses using exclusive rights on the territory of Cyprus. |
Defence tax | 3-30% is provided exclusively for business with a resident of Cyprus. |
Capital gains tax | 20% exemption from taxation on income from the sale of shares abroad. |
VAT | 19% – reduced, 5% – standard |
The law allows any business to be opened, but it must comply with the business entity (the preferred form for foreign residents is LLC). It provides conditions for residents and non-residents in the process of their registration. The most popular forms of doing business are:
Cyprus is good for opening almost any startup due to its advanced tax and economic system, but the most successful will be a business related to tourist entertainment, such as tours, casinos, amusement parks, etc.
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