Cyprus is a reputable International (Offshore) jurisdiction, not only due to the favourable tax regime and its wide network of double tax treaties but also due to the island’s privileged position as a stepping stone between three continents Europe, Asia and Africa, the low operating costs and the high standard of professional services.

The entry of Cyprus to the European Union gave added value to Cyprus International (Offshore) Business Companies (IBC) as there is no distinction between local Companies and IBC. All Companies have a European status and enjoy the lowest Tax rates in Europe, free from the usual suspicions that accompany other Offshore Business Centres which carry the “Tax haven” label.

FISCAL ADVANTAGES OF OFFSHORE BUSINESS IN CYPRUS

The major fiscal advantages for the International Business Companies (IBCs) are as follows:

  • There is no distinction between local Companies and IBC . Net profits of IBC and International branches managed and controlled from Cyprus are taxed at 10%
  • No Tax on profits from the operation or management of a Cyprus-registered vessel
  • Option between tonnage tax and 4,25% Corporation Tax if the vessel is not registered under the Cyprus flag
  • International business branches which are managed and controlled from abroad and International
  • Business partnerships are totally exempt from Corporation or 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 under certain conditions and profits from the sale of shares are exempt
  • Use of a large number of double tax treaties
  • No Capital Gains Tax except on sale of immovable estate situated in Cyprus
  • Interest received is subject to Defense contribution at 10% or under Corporation Tax also at 10%
  • No time restrictions on carrying forward Tax losses
  • Group relief for utilization of Tax losses
  • No exchange control restrictions (bank accounts in any currency, anywhere in the world)
  • Confidentiality and anonymity of the beneficial owners is assured