Cyprus is an island situated in the north eastern Mediterranean Sea at the crossroads of Europe, Asia and Africa. Cyprus’ capital city is Nicosia, which has a population of about 200,000 people.
Cyprus gained independence from Britain in 1960 and adopted a presidential system of Government with elections for the President taking place every 5 years. In 1974 Turkey invaded Cyprus and has since occupied the northern 40% of Cyprus; discussions are currently taking place with a view to the eventual reunification of Cyprus.
The southern part of Cyprus is known as the Republic of Cyprus and the official language is Greek. English is widely spoken and is the language commonly used in business, government and the courts. Laws are based on the English legal system and company law is modelled on the UK Companies Act 1948. In addition, Cyprus has been a full member of the European Union since 2004 and adopted the Euro as its currency in 2008.
The Republic of Cyprus’ economy is prosperous and has diversified over recent years. It has recently been sought as a base for many offshore businesses due to its highly developed infrastructure and excellent communications.
With its tax legislation, Cyprus has demonstrated its competitiveness as an international finance centre. Cyprus is an excellent location for investments to and from Russia and Central and Eastern Europe. It also has the most attractive tax regime in the EU and is often used as a stepping stone to and from the EU.
Cyprus has over 40 double taxation treaties in force and is currently negotiating many more. New markets are being opened as many clients are now looking to use Cyprus for effective tax planning when investing in fast-developing economies like India or China.
Sovereign’s Cyprus office is based in Cyprus’ second-city, Limassol; itself an international business-hub which is even challenging the capital Nicosia as an economic centre. Its cosmopolitan population and renewed infrastructure in both the business and leisure sectors have helped encourage many international companies to relocate to the city.
Why setup a company in Cyprus?
Thanks to its incredibly advantageous and flexible tax system, Cyprus has become one of the most favoured jurisdictions in Europe from which to conduct international business.
Characteristics that make Cyprus the ideal choice for any corporate tax-solution include:
- Access to EU Directives via EU membership
- Access to a wide tax treaty network (holding, finance and royalty companies)
- Foreign dividends are, in most cases, exempt from tax in Cyprus
- No Capital Gains Taxes except in cases of local real estate
- No Withholding Taxes
- Tax relief for foreign tax paid is granted to Cyprus Companies
- English is the most widely used business language
- Modern and efficient international banking sector
- Good Communications and geographical location