Over the years, Cyprus has established itself as an international financial center.
Cyprus is an attractive international financial centre, combining a convenient strategic geographical location between three continents (Europe, Asia and Africa), low tax rates (corporation tax rate is currently 12,5% which is the lowest in the European Union), financial stability and credibility as well as a long and growing list of international treaties for the avoidance of double taxation.

Cyprus was accepted to full membership of the European Union on 1 May 2004 and fully adopted the Euro as its official currency on 1 January 2008. Thus, Cyprus businesses have full access to EU markets with all the privileges this entails.
Low tax rates (corporation tax rate is currently 12,5% which is the lowest in the European Union), combined with a long and growing list of double taxation treaties provides companies resident in Cyprus with a strong basis for cross-border investments.

Cyprus investment holding companies enjoy the additional tax advantage of dividend income and profit from the sale of shares being exempt from taxation. Cyprus has no withholding tax imposed on dividend income, interest, or royalty payments effected to non-Cypriot beneficiaries. Profits from overseas permanent establishments are tax exempt.
Additionally, Cyprus maintains a highly professional workforce to provide support to international business. The legal system is based on English common law and English is fluently spoken throughout the country. The accounting, legal and banking sectors are highly developed and the country enjoys a high standard of living, excellent telecommunication facilities and infrastructure in a stable and low-crime environment.

Cyprus also enjoys excellent business relations and flight connections to the Middle East, a wide network of air-routes offering excellent connections to Europe, Africa, and Asia, as well as modern ports and first-rate sea connectivity.

As part of the accession process towards full membership of the European Union, Cyprus reformed its tax legislation which, as of 1 January 2003, conforms with EU requirements and fully complies with the OECD initiative against harmful tax practices.

The existence of a long and growing list of double taxation treaties, including particularly favorable treaties with the Russian Federation and most Eastern European Countries, combined with relatively low tax rates (corporation tax rate is currently 12,5% which is the lowest in the European Union), as well as other factors explained above have contributed towards establishing Cyprus as a key jurisdiction for international tax planning. Cyprus is now firmly established as the main international business centre for holding investments in the Russian Federation as well as other Eastern European countries.

Click here to access our article titled “10 good reasons for investing in Cyprus”.

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