Corporate Law

Company type: Limited Liability Company (LTD).

Applicable law: The Cyprus Companies Law, CAP.113.

Company name: Desirable names are submitted to the Registrar of Companies for approval. It can take between 2-5 working days to get a name approved. Name application can be rejected due to similarity with Company names already registered. Company names must end with the suffix LTD or LIMITED.

Incorporation timescale: After name approval, it usually takes 5-10 working days, depending on the workload of the Cyprus Registrar of Companies.

Shelf companies: Yes, available.

Registered office: Yes, it is a requirement. A physical address is needed, and not a P.O. Box.

Company secretary: Yes, it is a requirement and can either be a natural person or a legal entity, preferably Cyprus resident, but can be of any nationality.

Company director: Yes, it is a requirement and can either be a natural person or a legal entity. Must be a resident of Cyprus in order to meet residency criteria for tax purposes.

Annual Returns requirement: Yes.

Financial Statements requirement: Yes.

Shareholders: Minimum 1 Shareholder, maximum 50. Same person or legal entity can act as Shareholder, Director and Secretary.

Details filed with the Registrar of Companies and found on public record: Memorandum & Articles of Association, Shareholder, Director, Secretary and Registered Office. The identity of the Beneficial Owner can be protected through the use of Nominees.

Minimum share capital: Usually 1000 shares of EUR1 each.

Anti-money laundering legislation in place? Yes.

Double Taxation Agreements in place? Yes, please contact us for a full list of countries with which Cyprus has entered into Agreements for the avoidance of Double-Taxation.

Corporate tax: Uniform 15% on profits.

When deciding upon a corporate structure the location of a Holding Company is of great importance in order to take advantage of the many tax benefits on offer. Current applicable legislation makes Cyprus one of the best locations to incorporate Holding Companies.

What is a holding company?

It is a company which is formed in such a way, so that its management can control and/or influence other companies within the same corporate structure. A Cyprus Holding Company is usually formed in order to hold foreign investments, the income of which is distributed to non-residents.

Benefits of a Cyprus Holding Company in brief:

• No withholding tax on dividends paid to non-residents shareholders;
• No withholding tax on interest paid from Cyprus;
• No tax on dividend income received from another Cyprus tax resident company;
• No tax on dividend income received from a foreign permanent establishment (PE) of a Cyprus holding company; provided one of the following conditions are met:
  • 1. The PE must not engage more than 50% directly or indirectly in activities which lead to passive income.
  • 2. The foreign tax burden on the profit of the dividend paying company is not lower than 6.25%.
• No tax on dividend income received from abroad; provided
  • 1. that they are not allowed as a tax deduction in the jurisdiction of the foreign paying company;
  • 2. the dividend paying subsidy company must not engage directly or indirectly more than 50% in activities which lead to passive income;
  • 3. or if the foreign tax burden of the dividend paying company is not lower than 6.25%

• Dividends received from abroad are exempt from Special Defence Contribution if one of the following conditions are met:
  • 1. The dividend paying company must not engage more than 50% directly or indirectly in activities which lead to passive income.
  • 2. The foreign tax burden on the profit of the dividend paying company is not lower than 6.25%.

• No withholding tax on royalties paid from Cyprus in respect of intellectual property exploited outside Cyprus;
• No tax on disposal or trading of securities;
• Only 2,5% effective taxation on profits from qualifying intellectual property;
• Notional interest deduction upon the introduction of new equity