Registering a Company in Cyprus (Legal Information)
Did you know that you can set up a company in the European Union (EU) and enjoy convenient taxation and excellent conditions for business activity less than an hour’s flight from Israel? The place where you can do this is Cyprus, where company registration has recently become very common. The current article explains what you need to know about registering a company in Cyprus.
The experts in corporate law and immigration law at our law firm in Jerusalem and Tel Aviv will assist you with any questions or concerns regarding the registration of your company in Cyprus. Our firm has over 30 years of experience in immigration law and starting new businesses overseas. The firm provides legal assistance throughout the registration process, as well as ongoing general legal advice for the company and its officers.
How Did Cyprus Become an International Business Hub?
Not everyone is aware that Cyprus, which is so close to Israeli territory, is a particularly attractive destination for registering and establishing companies. It seems that, for most Israelis, Cyprus is primarily a popular tourist destination, as well as a preferred destination for civil marriage. Recently, however, more and more entrepreneurs from Israel and other countries are discovering the enormous business potential inherent in starting a business in Cyprus.
Cyprus has been known for decades for its beneficial tax policy toward local and foreign companies. Its accession to the European Union in 2004 reinforced this, helping to create Cyprus’ double taxation treaties with many countries, including the United States, Britain, and various EU member states. The corporate tax in Cyprus is one of the lowest in the world. As of 2020, it stands at only 12.5%. Capital gains tax does not apply to the income of most types of companies, except in certain transactions such as real estate transactions. This policy attracts entrepreneurs and business people from all over the world, who establish companies in its territory.
How Do You Register a Company in Cyprus?
Cypriot law distinguishes between three types of companies: public companies, private companies, and offshore companies. The latter is usually the most relevant for foreigners wishing to establish a company in Cyprus. Offshore companies are foreign-owned (i.e., owned by non-Cypriot citizens) international companies whose business activity takes place mainly outside the territory of Cyprus. Each type of company has different benefits. For example, the above-mentioned double taxation treaties are particularly relevant to companies owned by residents of the island. It is important to decide in advance what type of corporation in Cyprus is relevant to your specific business, and apply for registration accordingly.
In Cyprus, companies must be registered with the Department of Registrar of Companies and Official Receiver. Application for registration of a company requires providing various details about the company, including the company’s shareholders, directors, and secretary (who may be individuals or corporations). It will also be necessary to write articles of association and a memorandum of association, which must be translated into Greek and signed by the shareholders. There is no required minimum or maximum amount of share capital for companies in Cyprus, but it is common practice to have a share capital of about € 1,000, which allows for the payment of lower fees.
Legal Assistance with Establishing a Company in Cyprus
Despite the requirement to submit a considerable amount of documents and information when registering a company in Cyprus, the registration process itself is relatively quick, and usually takes between 5 and 10 business days total. It is advisable to seek the assistance of a lawyer specializing in corporate law and experienced in establishing companies in Cyprus, throughout the procedure. This is important due to various aspects of Cypriot law that require specific knowledge and proficiency, such as the above-mentioned requirement to choose the type of corporation ahead of time. Legal assistance is also important in creating an ideal tax policy for your business.
Registering a Company in Cyprus – Contact a Lawyer Specializing in Corporate Law
This article briefly explained how to start a company in Cyprus, and the benefits of doing so. If you have any further questions or need advice and assistance on the subject, you can contact us and a lawyer from our firm will be happy to be at your service in any matter. Our law firm in Jerusalem and Tel Aviv specializes in corporate law and assists in starting businesses in Cyprus and a variety of other destinations around the world.