WHY CYPRUS. Country’s overview

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Cyprus offers a unique solution, which successfully combines the most important qualities of an international financial center, namely:


  1. Robust Legal Framework for Protection of Investment/ Assets

  2. Compliant and Transparent Tax Law Regime

  3. Tax efficient jurisdiction for Business

  4. Favorable tax provisions for Individual Investors

  5. Strategic business Hub – Regional HQ

  6. Economy prospects and investment opportunities

  7. High Quality of living

  8. Policy on foreign investment and available investment schemes

  • Cyprus is an independent, sovereign republic with a presidential system of government and a written constitution which safeguards the rule of law, political stability, human rights and the ownership of property.

  • Cyprus is a full member of the European Union, Commonwealth of Nations, Council of Europe, International Monetary Fund, United Nations, World Bank and World Trade Organization and is signatory to many international conventions and treaties.

  • Cyprus has a simplified, transparent and efficient tax system.

  • It is fully aligned with the EU Laws and Directives, including the:

    • Parent-Subsidiary directive

    • Interest and Royalty directive

    • Mergers directive

    • Directive on Administrative Cooperation 
       
  • Cyprus legal system which follows the principles of common law is also compliant with the European Union laws and regulations. European Union directives are fully transposed into local legislation and European Union regulations have direct effect and full application in Cyprus.

  • Cyprus has an extensive and growing double taxation treaty network with more than 60 countries (worldwide).

  • It is fully aligned with International Organizations directives and guidance, such as the OECD, Financial Action Task Force (FATF).

  • The OECD includes Cyprus on the White List of jurisdictions that have substantially implemented the internationally agreed tax standard on transparency and exchange of information.

 

The Cyprus tax system provides an excellent framework for the operation of businesses across all industries.


  • Cyprus has one of the lowest corporate income tax rates at 12.5%.

  • An Ideal Holding Company Tax Jurisdiction - Nil or Low Withholding Taxes

  • A Cyprus Holding Company can achieve low or zero withholding tax rates when extracting dividends from foreign participation holdings by relying either on Cyprus’s extensive double tax treaty or on the EU Parent Subsidiary Directive.

  • Extensive and growing double taxation treaty network with more than 60 countries (worldwide).

  • Significant tax savings/ exemptions due to the implementation of the UE Tax Directives, including:

    • Interest and Royalty directive

    • Parent-Subsidiary directive 

  • Significant Income Tax Exemptions

  • Notional interest deduction (NID) available for equity investment in companies registered in Cyprus

  • Tax free and/or Flexible Tax Provisions on Reorganizations and Cross Border Mergers and Re- domiciliation

  • Favorable tax regime for Intellectual Property (royalty income)

  • Favorable tax regime for Funds

  • Favorable tax regime for Cyprus International Trusts

  • Competitive Tonnage Tax for Shipping companies
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