CYPRUS COMPANY FORMATION
Corporate Tax 12,5%
Tax exemptions for Owners
Low maintenance fees
Registration in 8 days
The formation of Cyprus company procedure is fast and easy if you have the proper professional guidance. Start operating in a very short time under Cyprus regime and benefit from the significant tax advantages of Cyprus corporate tax. In this page you will find everything you need to know related to Cyprus company formation.
- Register your company without visiting Cyprus
- Get Cyprus Tax id number and benefit from the low-income tax
- Operate worldwide with your Cyprus Company
- Company bank account in 5 days
- Fast and easy process. No fuss. Sent us the paperwork and we do the rest.
CYPRUS COMPANY FORMATION. WHAT YOU NEED TO KNOW TO START?
Cyprus Company Types.
The main types of Cyprus Registered Companies
Private Limited Company (LTD)
A Private Limited Company in Cyprus requires a minimum of one member and allows a maximum of fifty. Additionally, the public cannot be invited to subscribe to its shares or debentures.
This is the most widely preferred company type in the business world, with the following key characteristics:
- A minimum of one member and a maximum of fifty are allowed;
- The liability of each member is restricted to the value of their subscribed shares;
- Bearer shares are not permitted (though nominee services may be provided);
- Preferential shares or various share classes can be issued;
- Share transfers are subject to restrictions;
- The company name must include the word “Limited” at the end.
Further details:
- The company can operate with a single director, who may be a Cypriot or a foreign national, and board meetings can take place anywhere globally;
- A registered office address in Cyprus and a company secretary are mandatory;
- The secretary is responsible for maintaining the Register of Members, the Minute Book (documenting board meetings and resolutions), the Register of Charges, the Register of Directors and Secretary, as well as safeguarding the company seal.
- Any charges against the company must be registered with the Company Registrar to secure priority and protection from claims by other creditors.
An important note: The identity of the beneficial owners of a Cyprus Private Limited Company can remain confidential through nominee arrangements. This confidentiality is assured provided neither the company nor its ultimate beneficial owners are engaged in criminal activities.
Public Company
Public companies require a minimum of seven founder members. They are allowed to invite the public to subscribe to their shares or debentures and have no restrictions on the transfer of shares.
Branch
Any company established outside of Cyprus can create a legal presence in Cyprus by forming a branch, commonly referred to as an overseas company.
To register a branch, the following documents must be submitted, translated into Greek:
- A certified copy of the company’s constitutional documents (e.g., Memorandum and Articles of Association, charter, etc.);
- Details of the company’s Directors and Secretary;
- The name and address of at least one Cyprus resident authorized to receive official notices on behalf of the company. For foreign entities operating as banks, insurance companies, or investment firms, special licenses must also be obtained from the appropriate regulatory authorities.
The amendments to Cyprus Company Law in 2003, introduced as part of the EU accession process, have impacted the regulations governing branches. All foreign companies operating a branch in Cyprus must submit their financial statements annually. These must reflect the statements presented at their most recent AGM and published in accordance with the laws of their country of incorporation.
However, EU-based corporations benefit from certain exemptions. They are not required to file separate financial statements for their branches in Cyprus if they already publish their financial statements in their country of registration and provide these to the Cyprus Registrar of Companies.
S.E ( European Company)
Cyprus updated its Company Law to align with Council Regulation (EC) No 2157/2001, introducing the European Company (SE) structure.
This amendment, enacted on July 7, 2006, via Law No. 98(I) of 2006, enables an SE to relocate its registered office between EU Member States without dissolving in the original jurisdiction.
An SE can be established through four methods:
Merger: Public limited companies from at least two different Member States can merge to form an SE.
Holding Company: Public and private limited companies from different Member States can create a holding SE.
Subsidiary: Legal entities governed by public or private law from different Member States, or an existing SE, can establish a subsidiary SE.
Conversion: A public limited liability company with a subsidiary in another Member State for at least two years can convert into an SE.
These provisions facilitate cross-border business operations within the EU by simplifying company mobility and restructuring.
Uses of Cyprus Companies.
How can i use my Cyprus Company?
A Cyprus registered company can be used in various ways supporting the needs of the company’s operations. Cyprus registered companies can have activities related to:
- Imports/exports
- Services providers
- Online shops
- Tech Start-Ups
- Finance companies
- Shipping companies (Merchant Shipping)
- Property Holdings
- Investment Companies
- Holding companies
- Intellectual Property Holding
Registration Time of a Cyprus Company.
It takes 8-10 working days to have your company registered in Cyprus.
Registration Requirements.
General Requirements
To establish a company in Cyprus, the following steps and information are required:
Company Name Approval: Obtain approval for the proposed company name from the Registrar of Companies. If a specific name isn’t preferred, a pre-approved “shelf” name can be provided.
Memorandum and Articles of Association: Provide a concise description of the company’s primary objectives to facilitate the drafting of its Memorandum and Articles of Association.
Share Capital Details: Specify the nominal share capital and its division. A common structure is €1,000 divided into 1,000 shares of €1 each. The capital can also be denominated in currencies other than the Euro.
Beneficial Owners’ Information: Provide the names, addresses, occupations, passport details, and nationalities of the intended beneficial owners, along with their respective shareholding proportions. If nominee shareholders are to be used, their details are also necessary.
Directors and Secretary Details: Submit the names, addresses, occupations, passport details, and nationalities of the proposed directors and company secretary. A minimum of one director is required, and the appointment of a secretary is mandatory.
Registered Office Address: Determine the company’s registered office address in Cyprus, which will serve as the official correspondence address.
Auditors’ Information: Provide details of the proposed auditors for the company.
Anti-Money Laundering Compliance: To comply with Anti-Money Laundering (AML) regulations, complete and sign the standard Know-Your-Client (KYC) questionnaire, which includes providing a valid passport, proof of address, and a bank reference letter.
Adhering to these requirements ensures a smooth company incorporation process in Cyprus.
Do i need a Cyprus address for my company?
Yes, you need a registered address in order to setup a company in Cyprus. Our firm has the capacity to help you find an office space, without the need for you to look around.
What is the minimum share capital required?
There is no minimum requirement of shares capital to start your Cyprus company.
What are the documents needed from the shareholders?
The documentation needed to register your company are:
- A certified copy of Passport or ID
- A certified copy or an original utility bill, as a proof of address.
- A reference letter from a bank institution, lawyer or accountant for the good standing of the beneficial owners.
- A questionnaire provided from KTC Business Consultants.
- A recent CV
- Last year’s tax return
Do i need to visit Cyprus to set-up a company?
No, you don’t need to visit Cyprus in order to register your company. Everything can be arranged from your country and we can take care of it. Our experts will communicate and advice you via email or a skype conference and then sent you the paperwork to be signed.
Fees and Obligations.
Company Annual Levy Fee
The annual levy fee to keep a company of 350 Euro is now abolished.
What are the legal obligations of a Cyprus registered company?
Annual Reports and Audited financial Statements have to be submitted online to the Cyprus company Registrar department in 28 days after the end of the fiscal year.
Cyprus companies have to convene at least one Directors meeting per year. This meeting is mandatory. The first annual directors meeting of the company has to take place in 18 months after the registration date of the company.
A Cyprus company has to be registered to the Tax department and issue a Tax Identification number within 60 days after the registration date.
The annual Tax return form has to be submitted 15 months following the year end.
The yearly tax has to be paid in three installments on the 31st of July, the 31st of December and the last one on the 30th of June of next year. All Cyprus companies have to calculate and submit their own tax payments within the tax year.
Every Cyprus registered company is obliged to keep accounting records and prepare audited financial statements.
Taxation.
What is the tax rate of a Cyprus company?
The corporate tax rate is 12.5%
Are there any additional taxes i should know?
No there are no any extra taxes.
What would be the tax rate if my company employ only myself?
This depends on the paid salary you will receive from your company. If you earn less than €19.500
You have no tax obligation.
How i will be taxed on my income in any of the below cases?
1. Cyprus Tax resident, director and employee of the company.
Taxed on worldwide income if is over €19.500
2. Non-Cyprus Tax resident, director and employee of the company.
Taxed only on Cyprus income if is over €19.500
3. Cyprus Tax resident, director, employee and a shareholder of the company.
Taxed on worldwide income if is over €19.500 Dividends are exempted from income tax and Cy withholding tax, but will pay National Health Insurance Scheme on 2.65% from 01/03/2020
4. Non-Cyprus Tax resident, director and shareholder of the company.
Taxed only on Cyprus income if is over €19.500 Dividends are totally exempted from Cyprus.
Tax Benefits.
A Cyprus company offers multinational corporations a flexible and efficient structure due to its favorable tax regime, which allows for reduced global tax liabilities and various exemptions and deductions on income and expenditures.
Special tax treatments are available for companies involved in maritime activities or intellectual property holdings. Additionally, holding company structures in Cyprus can help international organizations lower tax and operational costs.
- Corporate tax rate at 12,5% on profit
- Dividend participation exemption
- Exemption on disposal of securities (e.g. shares, bonds, debentures)
- Notional interest deduction for investments into Cyprus companies
- More than 60 double tax treaties
- No capital gains tax (except for disposal of real estate in Cyprus or shares of company holding real estate in Cyprus to the extent gains is attributable to the real estate holding)
- Tonnage tax for shipping companies
- No succession taxes
- Attractive IP regime
Banking.
Opening a Bank account for your Cyprus company.
How many days it takes to open up a bank account?
Takes approximately 3-5 working days from the day the signed documents from beneficial owners are delivered to the bank.
What is the paperwork needed to open up a company bank account?
- Company certificates (Shareholders certificate, registered office, Incorporation certificate, Directors and secretary certificate)
- Memorandum and Articles of association
- Identification documents of the beneficiary person (Id, Passport and proof of permanent address)
Can i open a bank account without being a Cyprus resident?
Yes you can open a corporate bank account.
Do I get a card when opening a bank account?
Yes, connected to the company’s bank account.
Are there any annual fees for the card?
Yes, but depends on the card type. ie Mastercard, Visa
Can I open a personal account as well?
Yes, if relevant information is provided.
Are there any fees when receiving payments in my company’s account?
Depends from the bank fee’s policies.
What are the obligations or fees of the company towards the bank?
Fees depend from the bank policy. Usually banks charge from €500 – €800 per year. A company is obliged to provide all requested information to the bank such as activities, owners, clients and customers.
Board of Directors.
A Cyprus registered company has to have Director(s) , Shareholder(s) and a Secretary stated.
Do company directors need to be residents in Cyprus?
At least one director has to be tax resident and annual meetings have to be held in Cyprus.
Can i have a single director for my Cyprus Company?
Yes you can.
Who can act as a secretary?
Anyone.
Who can act as a company director?
Any person from Cyprus or abroad that has no criminal record.
Employment.
It’s easy to employee staff in Cyprus. Cyprus has one of the most educated labor force in Europe.
Our firm can assist you and advice on the recruiting process.
Can I hire a non-Cypriot resident to work for my company?
Yes. In the case of an EU citizen he has to visit Cyprus and obtain the yellow slip permit. If is a third country national (outside of CY/EU) then the application of visa is required and different employment criteria according to the Cyprus Department of Labour.
What is the minimum salary allowed by the law?
The minimum wage in Cyprus is 870 Euro gross and after the continuous employment from the same company goes to 924 Euro. The hourly rate varies depending on the job profile starting from 4,55
What is the monthly insurance fee for the salaried personnel?
The total insurance fee is 20.3%. The fee of 12% is employer’s responsibility and the rest of 8.3% is paid by the employee. Employer’s contributions include the Social Insurance Fee (8.3%), Redundancy Fund (1.2%), HR Development Authority Fund (0.5%) and lastly the Social Cohesion Fund (2%). Please note that these numbers may change year after year according to the Social Insurance Department.
Frequently Asked Questions
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