The most commonly used business entity is the limited liability company (Ltd). This means that the liability of its members is limited to the amount of share capital subscribed the company. The share capital of the company is divided to a number of shares and each share has a nominal value (usually 1 share has a nominal value of EUR1).
The following information is required for the relevant approval and establishment of a Cyprus Limited Liability Company:
- The proposed name of the company, which has to be approved by the Registrar of Companies.
- The amount of the authorized and issued sharecapital of the proposed company. The authorised share capital is the maximum amount of capital that a company may issue to its shareholders. Both, authorised and issued share capital may be increased in the future. Usually, and unless there is a special reason, the incorporation is done with EUR5.000 authorised and EUR1.000 issued share capital.
- Full name and address of the Shareholder(s). (One or more persons may form a company). If full anonymity and confidentiality is desired, nominee shareholders from our firm may be used, who will hold the shares in trust for the Beneficial Owner.
- From a tax planning point of view, it is important that the Company is managed and controlled in Cyprus and accordingly it is recommended that the majority of the Directors appointed are Cyprus residents. It is sometimes desirable that foreign Directors are also appointed, but it is advisable that the number of the intended Foreign Directors resident in a particular country is always below the minimum number necessary to constitute a quorum in Cyprus.
- For a proposed incorporation, “nominee” directors (persons from our firm) may be appointed, as per your wishes. Concerning the “nominee” directors please be informed that a Directors’ Indemnity Agreement will be signed by the beneficial owner(s), according to which the directors appointed will only act upon their written instructions / wish, unless they are obliged by law to act accordingly (duties derived from their capacity as directors of the company).
- The existence of a Secretary is a requirement of the Law and for this purpose we usually appoint one of our secretarial companies.
- Every Company must have a Registered Office. The Registered Office is the place where writs, summonses, notices, orders and other official documents can be served upon the company. Again, we usually use our firm’s addresses. It is not necessary for the company to open an office in Cyprus for its business activities, unless the client wishes to do so. Please note that the Registered Address may be also considered as the company’s offices.
- The time needed for the registration of the Cyprus Company is about 10 working days.
- Cyprus has one of the lowest tax rate in the European Union, which is 12.5%
- Cyprus is not a Tax Heaven business centre.
- Cyprus has signed Double Tax Treaties with more than 30 countries all over the world, some of which are very attractive for the international clients.
- Cyprus has a stable tax system regime.
- No tax is deducted in paying dividends out of a company which is directly or indirectly (through nominees) controlled by non residents of Cyprus.
- Profits from the disposal of shares and other securities are fully exempt from corporate taxation. This planning point makes Cyprus an ideal place for holding company establishment.
- Income from dividends is exempted from taxation.
- Cyprus companies are required to submit audited financial statements to income tax authorities and The Registrar of Companies. This requirement enhances the status of the company.
- Cyprus is using the International Financial Reporting Standards (IFRS) and International Standards on Auditing.
- Cyprus is a full E.U. member country.
- Cyprus professional community is very well experienced and organised to serve international clients (accountants and tax experts, lawyers, banks, financial analysts, property developers etc).
- Business transactions in Cyprus are fully allowed.
INTERNATIONAL BUSINESS ACTIVITIES
International Business activities in Cyprus include among others the following:
- Shipping and ship-management activities
- Offshore banking
- Captive insurance
- Transit trade, reinvoicing and transfer pricing
- Personnel recruitment and training
- Regional Headquarters
- Holding Companies
- Collection of Royalties
- Business consulting and services
- holding of property and securities
- electrical and mechanical engineering
- construction and engineering companies
- hotel ownership and management
- advertising and graphics
- trust and fund management companies
- investment companies
- computer hardware and software business
- repairs and maintenance of equipment and components