Are you an entrepreneur, digital nomad or business owner contemplating whether doing business in Cyprus is the best choice for you?
Look no further! This blog article by Immigration Explorer, your immigration consulting company, has all the information you need.
First, we look at the advantages of Cyprus for your life and your business. Then, we present to you the 8 reasons for doing business in Cyprus and how to start a business in Cyprus in 5 steps. Finally, we talk about the booming industries in Cyprus and the best way to relocate to Cyprus.
Living In Cyprus Will Make Your Life Better
Living in Cyprus has many upsides. The “Jewel of the Mediterranean” offers a great location at the crossroads of three continents. Its vibrant history will enchant you. Did you know that Cyprus is the island of the goddess of love, Aphrodite, or Venus as she is known in the Roman culture?
You will love the sunny weather and comfortable Mediterranean climate. And so will your friends and family! Whether you prefer sandy beaches with crystal clear water or impressive mountain ranges, the gorgeous Cypriot nature will delight you!
The island’s easy-going lifestyle and clean air make it one of the healthiest and most relaxing countries to live in. The delicious and healthy food makes Cyprus a favorite place for retirees, business owners, vacationers, and expats alike. The affordable cost of living will further convince you. The cost of living in Cyprus is around 25% cheaper compared to the European average.
The excellent healthcare services with international standards are an additional plus for Cyprus. So much so that even the medical tourism in Cyprus is booming! In June 2019, an upgraded National Healthcare System “NHS” was launched. Healthcare recipients – citizens and tax residents – are able to get primary care services free of charge. This new system was fully rolled out in June 2020.
Finally, Cyprus is one of the safest countries in Europe. And the favorable tax and financial regulations will be of particular interest to you as a business owner.
8 reasons for doing business in Cyprus
Are you thinking about relocating your business to a place with favorable tax and financial regulations? Are you contemplating starting a company abroad? Maybe you are looking for a tax residency where you only need to stay 2 months a year?
Regardless of your business structure or business model, Cyprus might be the best country for you! And here is why:
- The strategic location of Cyprus in Europe and the EU
- The corporate tax rate at a low 12.5%
- There is no withholding tax in Cyprus, and the intellectual property tax is low as well.
- In Cyprus, you can deduct many of your expenses from the tax. With this, you can have an effective tax rate of around 5% for your business.
- Social security contributions can be regulated by the business owners themselves. Tip: If you pay yourself a low income and get the rest via a tax-free dividend you only have to pay a very small social security contribution.
- Cyprus has double tax treaties with more than 65 countries. These so-called Double Tax Agreements (DTAs) can provide further tax benefits.
- The work-force is well educated and the business environment is friendly in general.
- There are tax incentives for new tax residents, who haven’t lived in Cyprus before. The so-called Non-Domicile or “Non-Dom” are exempt from tax for globally generated income from interest and dividends, for example, from stock investments. The country guarantees this for 17 years after the application.
Besides, Cyprus was listed as a business center in the Forbes list of “Best countries for Business” in 2019. If you are a small business owner or lead a larger company, enjoy the ease of doing business in Cyprus!
How to start a business in Cyprus in 5 steps
No matter which type of business you run, whether you offer a product or service, these are the 5 steps to start a business in Cyprus. At this point, of course, you will have done your market research and finished writing a business plan!
- After you arrive in Cyprus, you first need to get your company name approved by the Cyprus Company Registrar. They will provide the documents you need, to get a business license.
- Submit the following documents to the Department of Registrar of Companies:
- HE1 Form
- HE2 Form
- HE3 Form
- Memorandum of Association
- Articles of Association
- Passport copy of the company director(s) and company secretary
- Proof of the address of the office in Cyprus
- Then, you will get the Certificate of Incorporation
- With this, you can apply for the Value Added Tax (VAT) Number by registering with the Tax Department.
- You also must get a Social Contribution registration at the Ministry of Labor, Welfare and Social Insurance.
The good news is that there is no minimum capital required. A company can be set up in as little as 5 days. And a bank account can be opened in 10-15 days. Running a business in Cyprus is relatively simple and straightforward due to its minimal regulatory environment.
The above information refers to starting a so-called “private Ltd.” in Cyprus. Of course, there is also the possibility to found a sole proprietorship. And if you establish a holding company you can enjoy the benefit of no withholding tax.
Immigration Explorer can connect you to set up an efficient business structure, including bookkeeping, and the annual audit of your business.
Our Expert Tip
There are other countries, which offer favorable conditions to set up your business. For example, Georgia. This country in the Caucasus is one of the easiest places for doing business.
Your business can particularly benefit from the combination of doing business in Georgia and Cyprus. You can live in Cyprus and be a tax resident there, while your company is registered in Georgia. With this, you can enjoy tax-exemption on corporate and individual taxes in Cyprus and Georgia.
Speak to the experts at Immigration Explorer to find the best solution for your business.
Which industries are booming in Cyprus?
Digitalization is on the verge across the globe, including in Cyprus. Changing business models and providing new revenue and value-producing opportunities with the use of digital technologies is revolutionizing all sectors.
Secondly, the construction sector provides many business opportunities as massive infrastructure and development projects are on the Cypriot government’s agenda. Besides, the field of education offers attractive business opportunities as there are many reputable educational institutions and universities on the island.
Furthermore, the dominant tourism sector and the maritime shipping industry offer attractive positions. The booming property rental market also presents many business opportunities. Finally, the transportation business and insurance brokerage are thriving businesses in Cyprus.
What’s the best way to relocate or move to Cyprus?
Moving to a new place is always exciting and accompanied by a lot of organizational tasks – from legal formalities to packing, travel arrangements and arriving at your new destination.
Besides, Cyprus is a regular member of the EU. The Cypriot passport provides you the freedom to work, travel, study and live anywhere in the 28 countries of the European Union. However, Cyprus is not part of the Schengen area.
Schengen refers to the EU passport-free and customs-free zone which covers most European countries. If you want to travel to the Schengen area and have a Cyprus passport, you need to apply for a visa. With an EU passport (Cyprus passport), this procedure is quick and easy. More information on how to apply for a Schengen visa.
The Takeaway: Doing Business in Cyprus
Now you know the advantages of setting up a business in Cyprus and how to get started. Read more about Cyprus business taxes here. Besides, in the face of Brexit, Cyprus can be a solution for business owners.
There’s no risk for you! Message Immigration Explorer for your FREE CONSULTATION today to find out which investment immigration solution is best for you, your family, and your business.