How to register a company in Cyprus in 2022: the main ways
Thousands of foreign companies are registered in Cyprus every year. The advantages are numerous. Cyprus is part of the EU, so a local company can operate in any market in Europe. Registering a company in Cyprus in 2022 allows the actual owner and his/her family members to obtain a visa for 2 years and a work permit. After 7 years, you can apply for an EU passport.
How to register an organization in Cyprus
Registering a company in Cyprus is relatively easy and faster than in many European countries. It can be done in two ways:
- By visiting the country personally.
What is required for registration
The procedure begins with an application for registration at the Registrar of Companies. To open a company in Cyprus in 2022 you need to do the following:
- Choose a unique name. Better check with the Registrar of Companies to avoid duplication;
- Draw up a Memorandum and Articles of Association, which define and limit the scope of the company;
- Take care of the authorized capital. There are no clear requirements for the amount, but usually it is not less than 1 thousand euros;
- Submit information about the shareholders. The information must include full name, address, copy of passport, number of shares, a certificate from the bank, the declaration of origin of funds. If you are worried about confidentiality, you can appoint nominee shareholders;
- Select directors, provide their details;
- Appoint a secretary. If there are several directors in the company, one of them can be the secretary. If there is only one director, the secretary should be hired;
- Provide a legal address where official documents and requests will be received.
How long does the registration take
If you fill out the paperwork correctly and submit the whole package of documents, registration takes 2-3 weeks. When the Registrar makes sure that the documents are in order, the company will receive a certificate of registration.
What to do after the registration
When you register your company, you need to:
- Open a bank account. You can do this in any country you are doing business in.
- Get a tax identification number. If your annual turnover is expected to exceed €15,600, you will need to register as a VAT payer.
- Register as an employer. You will not be able to employ staff in your Cyprus company until you register as an employer with the Ministry of Employment, Social Security and Insurance.
Once you have completed these steps, you can start working. The process may seem tedious if you are outside of Cyprus. You may make it easier for yourself by using the IT OFFSHORE services.
And about taxes
Cyprus is one of the few jurisdictions in Europe that has been called a tax haven for businesses, despite the fact that Cypriot organizations are not exactly tax exempt. Income tax for businesses that do not operate in Cyprus is 4.5%, for residents - 12.5%, which is much lower than in many EU countries. In addition, the company receives a full exemption from capital gains tax if the income was generated outside of Cyprus.
Other interesting points:
- Cyprus has signed a double taxation treaty with many countries around the world;
- A company may not pay tax on dividends received from any of its subsidiaries;
- No tax is due if the company opens any permanent establishment abroad, including a hotel, restaurant chain, stores, etc;
- The company pays only 2.5% tax on all profits received from owning or trading in intellectual property rights (patents, trade names, trademarks, rights to the music, sports, etc.).
Thus, by optimizing taxes, a business in Cyprus can save money and not be afraid of being prosecuted in its country.