I
Cyprus

Cyprus

Company Formation in Cyprus

Cyprus

Formation Time
5–8 business days
Min. Capital
€1,000 (recommended)
Corporate Tax
12.5% standard / 2.5% IP Box
Foreign Ownership
100%

Overview

Cyprus offers one of the most compelling and tax-efficient corporate frameworks in the European Union. Featuring a low 12.5% headline corporate tax rate, an innovative IP Box regime delivering an effective 2.5% tax rate on qualifying intellectual property income, and complete exemptions on dividend income and equity capital gains, Cyprus is a primary destination for tech companies, SaaS businesses, and international holding structures. As an EU member state located strategically at the crossroads of Europe, the Middle East, and Asia, Cyprus provides a Common Law legal system, 65 double tax treaties, and an attractive Non-Domicile (Non-Dom) personal tax regime for international founders.

12.5% corporate tax
2.5% IP Box regime
0% dividend withholding tax
Non-Dom 0% personal tax on dividends
65 double tax treaties

Why Choose Cyprus

1

12.5% flat corporate income tax — one of the lowest in the European Union

2

Cyprus IP Box regime providing an 80% exemption = 2.5% effective tax on qualifying IP profits

3

0% tax on dividends received from qualifying foreign subsidiaries

4

0% withholding tax on dividends, interest, and royalties paid to non-resident shareholders

5

0% capital gains tax on the disposal of shares, bonds, and corporate securities

6

Non-Domicile (Non-Dom) personal tax status offering 0% tax on dividends and interest for 17 years

7

English Common Law legal system and widely spoken English business environment

Business Entity Types

EntityOwnershipDirectorsCapitalTaxBest For
Private Limited Company (Ltd)100%1 director€1,000 (standard recommended)12.5% corporate tax on worldwide trading incomeSoftware companies, SaaS platforms, international trading, consulting, digital agencies
Cyprus Holding Company100%1€1,0000% tax on incoming dividends and 0% capital gains on subsidiary share salesRegional holding structures, cross-border corporate groups, joint venture vehicles
Branch of Foreign Company100%1 local representativeNone12.5% on Cyprus-attributable branch profitsInternational corporations expanding physical operations into the Eastern Mediterranean

Step-by-Step Formation Process

1

Company Name Approval

1–2 days

Submit name application to the Registrar of Companies in Nicosia.

2

Drafting of Memorandum & Articles

2–3 days

Draft company constitution compliant with Cyprus Companies Law (Cap. 113).

3

Filing & Certificate of Incorporation

3–5 days

Submit application to Registrar and receive HE3/HE4 certificates.

4

Tax & VAT Registration (TIC)

1–2 weeks

Register with Cyprus Tax Department for Tax Identification Code (TIC) and VAT.

5

Corporate Bank Account Opening

2–4 weeks

Open multi-currency corporate account with Cyprus commercial bank or EU EMI.

Costs & Fees

Government / License FeeEUR 500+
Our Service FeeUSD 3,000 – 4,800
Annual RenewalUSD 2,000+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

Cyprus companies can open accounts with domestic commercial banks (Bank of Cyprus, Hellenic Bank, Eurobank) or European electronic money institutions (EMIs) like Revolut Business, Wise, and 3S Money. EMIs offer fast digital onboarding within 1 to 2 weeks.

Account Opening Time
1–2 weeks (Digital / EMI); 3–6 weeks (Domestic Cyprus Bank)
Multi-Currency
Yes — multiple currencies supported

Recommended Banks

Bank of CyprusHellenic BankEurobank CyprusRevolut BusinessWise Business3S Money

Tax Overview

Corporate Tax
12.5% standard corporate rate; 2.5% effective rate on qualifying intellectual property under the IP Box regime
Personal Income Tax
0–35% progressive income tax (first €19,500 tax-free)
VAT / Sales Tax
19% standard rate (reduced rates of 9% and 5% for hospitality and essentials)
Capital Gains Tax
0% capital gains tax on disposal of securities, shares, and bonds (only applies to Cyprus immovable property)
Withholding Tax
0% withholding tax on outbound dividends, interest, and royalties paid to non-residents
Double Tax Treaties
65 countries

Cyprus Notional Interest Deduction (NID) allows up to an 80% tax deduction on taxable profits from new equity introduced into the company.

Visa & Residency

Digital Nomad Visa

1 year, renewable up to 3 years

For remote workers earning €3,500+ monthly from employers or clients outside Cyprus

Foreign Interest Company (FIC) Work Permits

Up to 3 years, renewable

Fast-track work and residence permits for foreign key staff and directors

Cyprus Permanent Residency (Category 6.2)

Permanent residence

Accelerated permanent residency via €300,000 commercial/residential investment

Family visa: AvailableProcessing: 4–8 weeks

Frequently Asked Questions

What is Cyprus's IP Box regime and how does the 2.5% tax rate work?
The Cyprus IP Box regime complies fully with the OECD 'modified nexus' approach. It grants an 80% deemed deduction on qualifying net profits generated from qualifying intellectual property (such as copyrighted software, patents, and technical models). With the standard corporate tax rate at 12.5%, taxing only 20% of the net IP profits yields an effective corporate tax rate of just 2.5%.
How does Cyprus corporate taxation work for holding companies?
Cyprus is one of Europe's premier holding jurisdictions because dividends received from foreign subsidiaries are 100% exempt from Cyprus corporate tax (subject to minor anti-tax avoidance criteria). Furthermore, gains realized from the sale of shares in foreign subsidiaries are 100% exempt from capital gains tax, and dividends distributed to non-resident shareholders suffer 0% withholding tax.
What is the Cyprus Non-Domicile (Non-Dom) tax status for founders?
Foreign founders and high-net-worth individuals who establish tax residency in Cyprus can claim 'Non-Domicile' status. Non-domiciled tax residents are 100% exempt from the 17% Special Defence Contribution (SDC) on dividends, bank interest, and rental income worldwide for a period of 17 years, allowing them to draw company dividends completely tax-free.
Does a Cyprus company need local directors to be tax-resident?
To obtain a Cyprus Tax Residency Certificate, a company must demonstrate that its 'management and control' is exercised in Cyprus. This requires that the majority of board directors are resident in Cyprus, board meetings are physically held in Cyprus, and key strategic decisions are documented locally. Incorp International provides experienced local resident nominee directors to satisfy this requirement.
What are the annual audit and accounting requirements in Cyprus?
Under Cyprus Companies Law (Cap. 113), every Cyprus company must maintain accounting records in accordance with International Financial Reporting Standards (IFRS) and submit an annual statutory audit performed by a licensed Cyprus auditor (ICPAC member). The audited accounts are submitted along with Annual Return Form HE32 to the Registrar.
How easy is it to open a corporate bank account for a Cyprus company?
Domestic banks like Bank of Cyprus, Hellenic Bank, and Eurobank Cyprus offer robust corporate accounts but perform comprehensive compliance checks taking 3 to 6 weeks. For faster operational setup, leading European EMIs (Revolut Business, Wise Business, 3S Money) provide multi-currency IBAN accounts remotely within 1 to 2 weeks.