The Ministers Council approved recently certain changes in the criteria for companies to register as foreign interest companies in Cyprus. These changes are valid from the 12th of December, 2022.
The changes aim to attract companies, their employees, and their families in Cyprus to establish their offices and take advantage of the favourable company and personal taxation system.
Criteria and eligibility
The majority of the company shares must be owned by non-EU nationals. If the share majority are not owned by third-country nationals (equal or less than 50%), then the company can again apply if the foreign participation amounts to at least 200.000 euros. In both cases, the ultimate beneficial owner must deposit the amount in a Cyprus Central Bank licensed institution or must provide investment evidence in Cyprus such as purchase of an office or office equipment purchase.
The following companies are also eligible:
- Public companies
- International activities companies
- Cyprus shipping companies
- High-tech companies such as ICT, computers, aviation, and others
- Cypriot pharmaceutical, biogenetics or biotechnology companies
- Companies with majority of share capital owned by persons with Cypriot citizenship
Again, the initial investment of at least 200.00 euros applies.
The following documents and certifications must be presented by the interested companies:
- Certificates of incorporation, registered office, directors, and shareholders. If the shareholders are other legal entities, a shareholder structure diagram must be presented that will clearly identify all natural persons as the ultimate beneficial owners
- Memorandum and article of association
- Company ownership directors’ affidavit
- Rental agreement or title deed or a sale document for the offices of the new business
- Audited financial statements (for non-newly incorporated companies)
- Company Tax Clearance Certificate (for non-newly incorporated companies)
- Bank statement and swift proving the deposit of at least 200.000 euros in a Cyprus licensed bank.
- Annual company levy tax payment receipt
- Employers Liability insurance
- Company activities short profile/description
Criteria for eligible employees
The following criteria must be met in order to hire third-country nationals:
- Original passport with 2 years at least validity
- Original contract of employment of minimum two years duration and a salary of at least 2500 euros per month. If the salary is below that, then the contract must be presented and stamped by the Cyprus Labor Department
- A short CV with copy of university diploma or at least 2 years of professional experience
- Original criminal report + official translation (APOSTILLED)
- Residence Rental agreement
- Additional documentation and certificates such as blood analysis results, employer’s declaration, health insurance coverage, MBCS3 form, and original authorization of representative.
Cyprus offers a plethora of advantages to companies and their employees in regard to taxation, personal taxation, and benefits, but interested companies and individuals must seek professional guidance and consultation before moving forward to avoid having their applications rejected.