law-firm-cyprus

Company Registration

FAQs

Company Registration

Once you contact us, we will send you the company registration form which includes the basic information you need to fill in. The information needed is essentially the following:

  1. The company name of choice unless you would like to take a pre-approved company name;
  2. The nature of the company’s business;
  3. The proof of identity and address as well as the profession of the Shareholder/s, Director, and Secretary as well as the desired registered office address

If you choose a company name, we will apply for it and have the Cyprus Companies Registrar reply within 3-4 working days. If you take a pre-approved name, or after your desired company name has been approved, we will lodge the necessary forms and the company’s memorandum and articles of association. The Company will be incorporated within 3-5 working days from the lodging of documents.

You can either choose a ready, off the shelf, company with no trading history on the same day of your request or you can take a pre-approved company name and have the company ready in 3-5 working days. You can change the company’s name later.

The main reason is to take advantage of Cyprus’s attractive taxation system and the extensive double tax treaty network enjoyed by Cyprus. Corporate tax is the lowest in Europe and there are no capital gains taxes on mergers, acquisitions or any other transaction that would attract capital gains with the exception of profits made on land in Cyprus. Profits made by a company trading in land may be taxed at the corporate tax rate of 12.5% instead of capital gains at 20%.

Corporate tax in Cyprus is 12.5%. There are no dividends tax people who are not tax residents in Cyprus and people who are tax resident but are not tax-domiciled. As a general guide, people can become tax domiciled after 17 years of tax residency.

For Cypriot companies whose activity is the development and exploitation of Intellectual Property effective taxation is 2.5% instead of 12.5%. Cyprus legislation permits 80% of sales to be deducted as a notional expense. Further expenses will be deducted from the rest of sales, taking taxation even lower than 2.5%.

The cost of a company incorporation in Cyprus is made up from expenses (money payable to authorities and other persons) and fees. The applicable fees as well as the expenses depend on the requirements. Costs (including expenses, fees and VAT) will typically – but not always – range between €1.200 – €2.000 depending on the requirements and the expenses that need to be paid.

No, the law provides that only lawyers can register companies in Cyprus.

The formation of a company in Cyprus is easy. A company will need to have at least 1 director, 1 shareholder, 1 secretary and a registered office.

For more information including the information you need to provide us for the incorporation of your company please read our guide

Nominee directors and shareholders are people appointed in the position of a director and a shareholder who act under the directions and for the best interests of someone else, the beneficiary of the shares and person who appoints the nominees. The beneficiary of the shares, while he/ she does not appear on the companies’ registrar as a director or a shareholder has the right to direct the said persons and the right to be registered at any point of his/ her choice as a shareholder and director of the company. The beneficiary is the true owner of the company.

Typically, there is a “nominee declaration” or a “trust deed” for persons who hold shares or the position of a director on someone else’s behalf.

You can be a director of the company but it is not advisable to do so if you would be the sole director of a company. A company in Cyprus needs to have its effective management and control in Cyprus, meaning that decisions must be taken in Cyprus, to be tax resident in Cyprus. The directors being resident in Cyprus is evidence of such management and control.

After the OECD new guidelines, tax authorities in various jurisdictions may also look at the actual presence/ substance of a company to determine whether they are tax resident in another country. The substance/ actual presence of a company is not a rigid concept but depends on factors proving that the company is not an artificial structure. Factors such as the Cypriot director being an employee of the Company, the director having some knowledge or expertise in the line of business of the company and the company having utility bills in Cyprus and personal telephone number are indicative of actual presence.

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