Tax Planning In Cyprus Made Easy

By on December 8, 2012

Cyprus as a base for international tax planning

It is very important for any business owner to consider the effect of corporate tax rates applied by a country to its business. This should be a big matter of interest because it could mean higher profits or lesser gain, especially if the company is expanding on a global market. Choose the right country as a base for your expanding offshore company and you will be pleased with the returns it will be providing you.

Cyprus has been a popular choice for many businessmen and global corporations. They believe that the strategic location of the country, as well as the appealing tax rates it’s offering are more than enough for business executives to put most of their investments under its care. Thus, more and more companies are submitting their applications for registration, hoping to become recipients of the above corporate tax benefits.

Main Tax Advantages in Cyprus

There are many types of possible international business companies to register in Cyprus; most of which have such desirable structures it’s too tempting not to force yourself to have your company immediately registered.

Zero Percent Tax Deductions

It is hard to find a member of the European Union offering zero percent tax deductions to companies and non-residents; but Cyprus was offered this kind of tax system for the past decade. Some of which are as follow:

  • Zero percent tax rates on dividends paid to non-resident shareholder or non-Cypriot company
  • Zero percent interest rate for non residents and non-Cypriot company
  • Zero percent tax rates on capital gains earned from immovable parties outside of Cyprus
  • Zero percent tax rate for profits and dividends paid by registered shipping companies.

Ideal Reasons Related to Tax Planning in Cyprus

Hiring a corporate and legal counsel to evaluate the financial consequences of your wish to invest in Cyprus will reveal many interesting facts that will further convince you that you are making the right decision to spend time, money, and effort in order to register a company in Cyprus.

  • Harness the benefits of Double Taxation Avoidance Treaties signed by Cyprus with more than 45 treaties. It would be too difficult to discern how this system works, unless you are educated with international taxation and have mastered the Cyprus tax system. Fortunately, the Cypriot Government has trained efficient and reliable accountants to assist you with Cyprus tax concerns.
  • Sale of subsidiary companies often hurts owners, even if this is designed to lessen the loss they have incurred. Cyprus understands these and gives you the liberty to proceed with the sale yet eliminate the worries of having to pay the taxes; however, you need to register a suitable company in Cyprus for this to become possible.
  • Cyprus has been a member of the European Union since the year 2004, amidst this fact it still offers the lowest corporate tax equivalent to 10%. This is tied with low operating costs in exchange for high quality services, investment, business administration, banking, accounting, tax, funds management, and brokerage system offered by professionals in the region. Moreover, it shares the advantage of full liberalization and elimination of quantitative restrictions and tariffs in accordance with the goal of the EU to promote promising opportunities to investors placing their trust in any of the EU members.

Economically speaking, Cyprus is a paradise for investors. Incorporating a company in Cyprus does not only give you a plethora of tax advantages, but an opportunity to indulge in the beauty of its landscape. Rest your worries away in Cyprus and embark in a business venture worth the challenges, effort, time, and financial resources.

Lucille Fernandez is a financial writer for PM Corporate Law. Choose a partner that understands the in and out of Cyprus tax rates for the best international tax planning strategy applied to your company.

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