Taxation of Interest
Interest earned from financing activities is taxed as ordinary business income at a rate of 12.5% (after deducting all business expenses). A very low profit margin of as little as 0,35% is [...]
Taxation of Dividends
Dividends are exempt from corporation tax Dividends received by a company are not subject to Special Defence Contribution (SDC) unless: The non-resident company paying the dividend engages directly of indirectly by more [...]
Tax losses carried forward indefinitely
The tax loss incurred during the year is carried forward and set off against future profits for a period of five years. In addition the loss can be set off against the [...]
Tax legislation approved by the EU
Cyprus is not a tax heaven. It is a highly respectful jurisdiction and its status was considerably improved after its accession to the EU. As a result registration of new International Business [...]
No withholding taxes on payments of dividends, interest and royalties outside Cyprus
This legislation reduces Cyprus taxes on payments outside Cyprus to 0% which makes Cyprus a very popular jurisdiction for holding, financing and royalty companies.
Double Tax Treaties
Cyprus differs from most other offshore jurisdictions, in that it offers a big number of double tax treaties (44 in total), for the avoidance of double taxation. In general most of the [...]
Corporation tax
A company is considered as a Tax Resident in Cyprus, if the management and control of the board meetings, take place in Cyprus. If the majority of the Directors is tax resident [...]
Capital gains tax
Capital gains is taxed at 20% on gains but gain on disposal of securities is completely exempt. Gains on disposal of property situated outside Cyprus is also exempt from any taxation.
Capital gains on disposal of securities
All gains from trading in securities are tax exempt. This exemption makes the Cyprus holding companies very attractive and popular. The term “Securities” is defined as shares, bonds, debentures, founders’ shares and [...]
Access to EU parent subsidiary directive
The directive intends to estimate the double taxation of dividends received by a parent company located in one member state from its subsidiary located in another. The Cyprus legislation is more generous [...]