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About Cyprus

About Cyprus

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Basking in over 340 days of sunshine a year, Cyprus is an ancient land famous for its archaeological sites and beautiful beaches. Lying at the crossroads of three continents, it is a beguiling mix of east and west boasting mountain peaks and deserted beaches and blending untamed beauty with cosmopolitan city life. With a total area of 9250km², Cyprus is the third largest island in the Mediterranean. Cyprus enjoys a prime location, benefiting from a wide network of air-routes from both scheduled and low-cost airlines that connect it with Europe, Africa and Asia. This, combined with its ideal climate and excellent tax and financial benefits, make it a location of choice for many affluent business-minded individuals and companies. Numerous studies have also cited Cyprus as the number one place for retirement and relocation. Its popularity is due to its first-class infrastructure, relaxed lifestyle, beautiful landscape, safe environment and of course, the personal taxation advantages it offers.

Cyprus fact file

Languages: Greek, Turkish & English
Member of: EU, UN, British Commonwealth
Dialing code: +357
Web domain: .com.cy
Cyprus ranks highly on several credible world ranking systems:

  • The Index of Economic Freedom 2011 - World rank 18 (same as the USA), regional rank 9
  • Forbes Best Countries for Business - rank 22
  • Knight Frank prime international residential index (PIRI) - rank 36
  • Doing Business 2011 - rank 37
  • Global Competitiveness Index 2010/2011 - rank 40

Business & investment

Cyprus offers a supremely favourable tax regime.

Cyprus Corporation tax

Cyprus’ entry into the European Union, combined with a tax reform in its legislation has further enhanced the islands attractiveness to (offshore) International Business Companies (IBCs).

This reform has removed distinctions between local companies and IBC’s, enabling both to benefit from uniform taxation rates and a European status. Cyprus based companies enjoy the lowest tax rates in Europe, which is one of the key reasons that it has become the favoured location for investments to and from other European Union countries, Russia, CIS and many other locations.

Cyprus also offers numerous additional advantages to businesses, such as its strategic location between three continents, excellent infrastructure and telecommunication network, efficient legal, banking and accounting services, highly skilled human capital and of course its stable economy.

Basis of Cyprus Taxation

All companies that are tax residents of Cyprus are taxed on their income accrued or derived from all sources in Cyprus and abroad. A non-Cyprus tax resident company is taxed on income accrued or derived from a business activity that is carried out through a permanent establishment in Cyprus and on certain income arising from sources in Cyprus. A company that is managed and controlled in Cyprus is considered resident.

Cyprus Corporation Taxes

The corporation tax rate for all companies is 10%

Cyprus IBC’s enjoy the following major fiscal advantages:

  • From 01.01.2003, there is no distinction between local Companies and IBC’s. Net profits of IBCs, and international branches managed and controlled from Cyprus, are taxed at 10%
  • International business branches and international business partnerships, which are managed and controlled from abroad, are exempt from corporation and income tax
  • No withholding tax on dividend distribution and payments of interest and royalties
  • Profits earned from a permanent establishment abroad are fully exempt from corporation tax
  • Dividend income is exempt from corporation tax provided the direct holding is at least 1% of the share capital of the overseas company. This exemption will not apply if the company paying the dividend engages in more than 50% of its activities introducing investment income and the foreign tax burden on the income of the company paying the dividends is substantially lower than that in Cyprus.
  • Employees of foreign entities can get a work permit visa in Cy-prus, provided they work in executive positions or in positions where similar skills cannot be found amongst the Cyprus labour force
  • Foreign employees resident in Cyprus will be taxed the same way as the local employees. If employed outside Cyprus, the salaries are tax exempt provided they are remitted through Cyprus.
  • Income derived by a way of interest on foreign capital imported and deposited to banks in Cyprus is tax exempt. Other interest received is subject to defence fund contribution at 15%. Interest earned from trading activities or closely related trading activities is li-able to 10% tax.
  • No tax from the sale of shares
  • Forty+ double tax treaties
  • No capital gains tax except on the sale of immovable estate situated in Cyprus
  • No time restrictions on carrying forward tax losses
  • Group relief for utilization of tax losses
  • VAT system not applicable on offshore activities
  • Capital allowances and expenses for the purpose of business are allowable for tax purposes
  • No stamp duties on normal trading activities
  • Exemption from estate duty on shares in foreign companies inherited in Cyprus
  • No exchange control restrictions (bank accounts in any currency, anywhere in the world)
  • Confidentiality and anonymity of the beneficial owners is assured by disclosing their details only to the Central Bank of Cyprus

Cyprus Personal Taxation

An individual is tax resident in Cyprus if he spends more than 183 days in Cyprus in any one calendar year. Days in and out of Cyprus are calculated as follows:

  • The day of departure from Cyprus counts as a day of residence outside Cyprus.
  • The day of arrival in Cyprus counts as a day of residence in Cyprus.
  • Arrival and departure from Cyprus on the same day counts as one day of residence in Cyprus.
  • Departure and arrival in Cyprus on the same day counts as one day of residence outside Cyprus.

CYPRUS PERSONAL TAX RATES

The following income tax rates apply to individuals:

Taxable incomeNormal tax rate
(EUR)(%)
0-19,5000
19,501-28,00020
28,001-36,30025
Over 36,00030

Foreign pensions are taxed at the rate of 5%. An annual exemption of €3.420 is granted.

  • Pensions receivable from abroad by a resident in respect of services rendered outside Cyprus are taxed at a flat rate of 5%, after deduction of the first €3,417, if the individual elects to do so. In the case of an individual taking up employment in the Republic, who was non-resident prior to his employment, an allowance of 20% of his remuneration to a maximum of €8,543 is given for a period of three years. Salaried services rendered abroad for a total period of more than 90 days to a non-resident employer or at a permanent establishment (PE) abroad of a resident employer are exempt from income tax.

Cyprus Capital Gains Tax

Capital gains tax is paid on gains arising from the sale of immovable property. Tax due is 20% on gains realised, which is calculated as follows:

Proceeds from the sale less cost of property, professional and legal fees, commission, interest paid, inflation allowance and investment allowance (€17,086 on disposal of any property and €85,430 on disposal of residence provided that it has been used as the main residence for at least 5 years prior to the sale).

The investment allowance is granted only once, unless it has not been exhausted at the first sale, in which case any balance would be carried forward. The investment allowance is granted to each owner of the property. For example, if a husband and wife own the property, then the total investment allowance is €34,172.

Cyprus Inheritance Tax

This was abolished as of 1st January 2000.

Cyprus’ popularity

EU member

  • Cyprus has been a member of the EU since May 2004, unlocking property restrictions and opening up work and business opportunities, thus broadening the lifestyle and investment possibilities. In January 2008 Cyprus adopted the Euro as its currency, raising the financial attractions even further.

Cypriot Hospitality

Cypriot hospitality is legendary; the locals are renowned for their warm and incredibly welcoming nature and the pace of life is very relaxed. Both English and Russian are widely spoken, making you instantly feel at home.

Relaxed lifestyle

The unhurried pace of Mediterranean life is best expressed in Cyprus, rewarding visitors and homeowners alike with a completely stress free atmosphere.

Easy communication

The Cyprus Telecommunications Authority is one of the most technologically advanced companies in the world, with cheap local and international call charges making it easy to keep in touch with friends and family.

Cyprus - A safe haven

Cyprus is an incredibly safe haven with the lowest crime rate in Europe crime rate and no vandalism, plus the benefits of no pollution or traffic congestion.

Cyprus Leisure Pursuits

No matter what your age or interests, Cyprus has something for everyone. Choose from a wide range of fitness classes and outdoor activities, turn your hand to writing, theatrics, arts and crafts, or enjoy events put on by the numerous social organisations.

Cypriot Community spirit

Community spirit thrives in Cyprus. For instance each village has a council headed by a locally elected official, who acts as an au-thoritative point of contact on many matters, from signing documents to interpreting and liaising on your behalf.

First-class Cyprus Healthcare

  • Cyprus offers a superior medical system, meaning that you can rest assured that your health is in safe hands. Public and private healthcare in Cyprus is of a high standard and is available to everyone. EU citizens permanently residing in Cyprus can apply to the Ministry of Health for a medical card. This will entitle you to free or subsidised public healthcare, depending upon your earnings. Pafilia can also arrange health insurance policies for clients upon request.

Cyprus Education

The education system in Cyprus is of a very high standard and accessible to all residents. The Cypriot government wishes to ensure that children from other countries continue their education whilst they are in Cyprus. A number of private schools (Greek, English, French and Russian) are also available. The fees range from €3,400 - €7,000 per annum. Higher education is also available through 6th form colleges and other recognised institutions. There are Universities in Nicosia, Limassol and Pafos. There is also an adult education program, offering a range of courses from Greek language to cookery and dance.

Cyprus Flora

Situated on the ecological cross roads between the Asian, European and African zones, Cyprus is home to a breathtaking 1750 floral species of which 126 are endemic. In the Akamas region alone there are 530 species of which 33 are endemic. Moreover the island’s climate and soil properties encourage herbs to be more potent than north European species, with particularly strong healing properties.

Cyprus Fauna

Cyprus is home to a number of rare species. Visit the forest land of Stavros Tis Psokas to catch a glimpse of the shy Moufflon, or take a trip across the Akamas Peninsula to the turtle hatchery at Lara Bay.

Cyprus Climate

Cyprus offers the best year round Mediterranean climate. Blessed with long summers and short winters there are an incredible 340 days of sunshine per year.

Cyprus Aquatics

Parasailing, windsurfing, water-skiing, jet skiing, sailing, power boating, kayaking, canoeing, banana and tube rides are accompanied by diverse opportunities for scuba diving, where shipwrecks and archaeological treasures create a mesmerising underwater world.

Get active

  • There are 48 signed trails traversing 200 kilometres of countryside nationwide. Experienced walkers rave about the island’s varied terrain and seasonal diversity. Indeed the challenging terrain of the Troodos mountains also offers a refreshing break from the summer heat, and a great introduction to the region’s rural villages. Those seeking a more leisurely pace should head for the shady forest trails, whilst the most breathtaking coastal views can be seen from the multitude of walks that weave through the Akamas peninsula.

Easy accessibility

There are two international airports in Cyprus served by over 50 airlines, ranging from the premier scheduled carriers, such as British Airways, Aeroflot and Emirates to the no-frills budget carriers such as Easyjet and Ryanair. If you fancy taking to the seas you will be happy to hear that Cyprus is included on the route of over fifty international cruise liners.

Exciting developments

Cyprus is being developed into a more upmarket destination, which is reflected in its new capital projects. Four new marinas and eleven new golf resorts are planned island wide. The stunning Minthis Hills golf resort has recently undergone a major upgrade, making it one of the most attractive courses in Europe.

Breathtaking topography

Cyprus offers a blissful blend of secluded and well facilitated beaches along its 648km of coastline, 52 of which are rated as Blue Flag. Yet the magnificent Troodos mountain range is within an easy driving distance, making Cyprus one of the few countries in the world where you can ski and swim in the same day.

Attractive market

The Cypriot property market remains more affordable than many of its Mediterranean counterparts. Couple this with the sheer diversity of locations, property styles and budgets and it’s easy to see the appeal.

Fascinating history

  • Renowned for its mythological connections with Aphrodite, Goddess of Beauty and Love, Cyprus is also rich in antiquities. Most no-tably Pafos is a former pre-Hellenic centre and as such is inscribed on the UNESCO World Heritage List with the remains of villas, pal-aces, theatres and fortresses giving the town exceptional value. Moreover the island’s historic towns also play a modern entertainment role, with the Roman amphitheatre at Episkopi and the amphitheatre and castle in Pafos hosting open air music and theatrical performances.

Mouth-watering cuisine

The island of Cyprus is rich in local wines, seafood, fresh fruit and vegetables and countless other mouth-watering delights.

The Regions of Cyprus

Pafos - Cyprus

  • Pafos, the mythical birthplace of Aphrodite, the Greek goddess of love and beauty, is situated on the South-Western coast of Cyprus. It is home to a great extent of the island’s rich cultural heritage including a medieval fortress, frescoed tombs and remarkable mosaics. Almost an open-air museum in itself, UNESCO added the entire town to its world heritage list. In addition to its rich culture, the Pafos area offers a wealth of amenities and facilities that cater to every need. Although contemporary in its offering, Pafos is a city that is in touch with its heritage, offering an authentic, relaxed Mediterranean lifestyle.

Polis - Cyprus

  • Polis is a small town situated on the North-Western coast of the island, at the centre of Chrysochous Bay. The picturesque town borders the protected Akamas peninsula, an exceptionally beautiful nature reserve, with a stunning array of wildlife. The area offers a plethora of secluded beaches with crystal-clear waters, undoubtedly some of the best on the island. The town centre offers a great selection of cafes and restaurants in addition to all the essential modern day amenities. Latsi is the picturesque harbour of Polis, reputed for its superb fish tavernas that overlook the newly extended marina.

Limassol - Cyprus

  • The second largest town in Cyprus, Limassol is a bubbling metropolis for business, shopping and cosmopolitan restaurants. Beach lovers will be equally satisfied, with seemingly infinite sandy shores that stretch miles away from the town. As a year round destination, vibrant events and street celebrations range from carnivals to wine festivals, filling up the town’s busy calendar. For those seeking traditional excursions, the ancient Kourion, Sanctuary of Aphrodite and Kolossi Castle are all within easy reach, as is the spectacular Troodos mountain range. With the possibility to ski, swim and enjoy the international flavour and historical surrounds, Limassol offers a world of opportunity, with the benefit of being conveniently located midway between Pafos and Larnaca airports.
Category: Articles | Added by: chas (23.08.2012)
Views: 3508 | Comments: 3 | Rating: 0.0/0
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