Cyprus with an excellent infrastructure and a large number of trained and qualified professionals and strategic geographical position, is an attractive financial centre which combines the advantages of a traditional offshore centre with those of the full membership of the European Union. The business of its kind in Cyprus is dedicated to add real substance in their tax planning, in the form of completed operations on the island.
Despite the fact that there are a number of countries that have established themselves as reliable financial centers in the European Union which are able to offer some very attractive tax advantages, none of these countries have managed to combine these benefits to the same extent as Cyprus, which apart from the wide network of double taxation agreements and the full implementation of EU directives, has been put in an enviable position in both the European Union and globally.
The main features of the tax laws that determine the attractiveness of optimizing international tax structures are as follows:
• One of the lowest corporate tax rates in the European Union: 12.5%
• Extensive network of double taxation with EU countries and other jurisdictions.
• Access to all tax EU directives
• No taxation on profits from the disposal of Securities
• No tax is withheld on transfers abroad
• Infinite store profit in Cypriot companies where shareholders are not tax residents in Cyprus (either directly or indirectly)
• Dividends received by a Cyprus company is exempt from Corporation Tax and from Special Defence Contribution (under conditions)
• No withholding taxes on dividend, interest and royalty payments abroad
• 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)
• Attractive ‘’IP Box’’ regime on intellectual property rights
• Notional interest deduction (NID) on the new capital introduced into the Cypriot company.
• Personal tax exemptions for new residents and non-domiciled individual
• Advanced tax system