Cyprus: Cyprus remains an attractive international business centre
International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Cyprus: Cyprus remains an attractive international business centre

kokoni.jpg

Zoe Kokoni

The recent developments in Cyprus that have monopolised the media, the financial and the business sectors worldwide, have created an unprecedented number of speculations, rumours, devastation theories and much more. As a result of the banking crisis, the measures to be implemented are expected to reinforce Cyprus's banking system and make it healthier and fundamentally stronger. Despite the turmoil in the banking sector, it is important to highlight that the corporate sector in Cyprus still stands strong as nothing has changed on the benefits Cyprus offers to international businesses when it comes to corporate structuring. The Cyprus banking crisis is not a barrier to transactions and investments in or through Cyprus. The use of Cyprus companies in international structures has not been affected and their use is still highly efficient. The ambiguity created by the recent developments in the banking sector has not affected the demand for structuring projects and investments with the use of Cyprus companies. The proposed increase of corporate tax rate from 10% to 12.5%, will still place Cyprus as a low tax jurisdiction within the EU.

Moreover, the advantages of holding companies, the majority of companies registered in Cyprus, will not be affected as the rule of no withholding taxes will not be changed. There is zero withholding tax on payment of dividends to non-tax residents, while there is a zero capital gains tax for transactions that do not involve immovable property situated in Cyprus.

The extensive double tax treaty network of Cyprus is still in place offering its benefits to the great number of foreign investors in the island. The Cyprus companies are still enjoying the tax incentives offered, the EU directives, which have been fully implemented in Cyprus, are still applicable and the high level of confidentiality and secrecy rules have not been shifted. Cyprus companies, such as financing, holding, trading, royalty (for which the effective tax rate, after the application of the measures will be 2.5% instead of 2%) and more, have not lost their advantageous edge and benefits.

International Cyprus trusts, which are significantly used for protection of assets and preservation of family wealth, have provided considerable beneficial tax advantages which have not been altered. Their provisions and their application is still fully effective and in force.

For many years now, Cyprus has achieved and gained its title as a solid economic and business model worldwide and the recent developments cannot alter this. The existing legal system, the beneficial tax regime and the qualified professionals that have provided high quality services to local and foreign investors are intact and still well-built.

Cyprus, despite all, remains an attractive international business centre.

Zoe Kokoni (zoe.kokoni@eurofast.eu)
Eurofast Taxand

Tel: +357 22 699 222

Website: www.eurofast.eu

more across site & bottom lb ros

More from across our site

Despite the relief, Brazil’s government has also presented a bill which seeks to re-impose a tax burden on companies’ payroll, one local tax specialist told ITR
Jeremy Brown arrives at the firm after a near 16-year career with Deloitte
PwC could elect a woman into the senior leadership position for the first time; in other news, KPMG Australia has extended its CEO’s term
The Senate report into PwC’s scandal is titled ‘The cover up worsens the crime’
Law firms that are conscious of their role in society are more likely to win work, according to a survey of over 23,000 in-house professionals
The firm’s tax business generated a quarter of HLB’s overall revenues in 2023
While successful pillar two implementation will require collaboration across all units, a combination of internal and external tax advice is at the centre of the effort
Binance has also been accused of manipulating foreign exchange rates via currency speculation and rate-fixing
Six individuals should have raised questions over information they received but did not breach professional standards, according to the firm
The partnership of KPMG UK has installed Holt for a second term as CEO and senior partner; in other news, a Baker McKenzie partner has sued the IRS
Gift this article