Cyprus Tax Planning

Cyprus has been a member of the European Union since 1 May 2004.

The fiscal regime put in place from 1 January 2003 to harmonise the tax legislation with the EU Directives and the EU Code of Conduct of business, offers a range of alternative tax advantages for structuring business through Cyprus.

Cyprus has the lowest corporate tax rate in the European Union.

The low tax rate coupled with an extensive list of double tax treaties, an enviable time zone location and a mature legal, accounting and banking infrastructure places Cyprus high on the list of preferred jurisdictions for international tax planners.

Key Benefits Offered

Introduction of the concept of tax resident and non-resident companies
Taxation of worldwide income for tax Residents and Cyprus sourced income for non-residents
A uniform corporate tax rate of 10%
Tax-exempt business profits of non-resident companies
Tax-exempt gains on the trading and disposal of securities
Tax-exempt dividend income (subject to applicable criteria)
Exemption of 50% of interest income (subject to applicable criteria)
Tax-neutral group reorganisations
Tax-relief for group losses
Full adoption of the EU Parent-Subsidiary Directive
Full adoption of the EU Mergers Directive
Full adoption of the EU Directive on Mutual Assistance and Cooperation
Full adoption of the EU Royalty and Interest Directive
Transitional rules for existing IBC’s until 2005