Over the past years, Cyprus has been developed into one of the most favorable places for international business. The Cyprus tax regime combined with Cyprus excellent geographical position, infrastructure and Cyprus ability to offer sophisticated planning structures, the ability to set up and manage Investment Funds (Cyprus Alternative investment funds – AIFs), the enactment of the Cyprus International Trusts Law which provided for the formation and administration of international trusts, the excellent geographical position, infrastructure and good quality of life, the recent developments like the construction of luxurious Marinas, the decision to build a mammoth casino resort and its excellent infrastructure in banking and telecommunication were some of the key factors for its success.
Cyprus is now encouraging High-net-worth individuals moving to Cyprus by giving personal taxation incentives and benefits
Individual’s most important Cyprus taxation considerations and benefits when moving to Cyprus:
+ An individual can become Cyprus tax resident and obtain a Cyprus Tax Identification Number (TIN) within a short period of time;
+ A Cyprus tax resident individual by obtaining the Cyprus nondomicile resident status is totally exempt from Cyprus taxes on dividend, interest, and rental (property situated in Cyprus) income;
+ There is no taxation for individuals becoming Cyprus tax residents on any profits earned from the disposal of securities including shares and bonds (not applicable for Cyprus property-rich companies);
+ Tax exemption of 50% of gross employment income earned in Cyprus by a Cyprus tax resident individual earning more than €100,000 of gross employment income per annum and who was resident outside of Cyprus before the commencement of his employment in Cyprus (available for 10 years);
+ Tax exemption of 20% of gross employment income (up to a maximum of €8.550) earned in Cyprus by a Cyprus tax resident individual earning less than €100,000 of gross employment income per annum and who was resident outside of Cyprus before the commencement of his employment in Cyprus. The exemption is available up to 2020. However, it is expected to be extended up to 2025. In case a 50% exemption (see above) is claimed, the 20%
the exemption does not apply;
+ No tax on employment income earned for offering services to an overseas employer or to an overseas permanent establishment (PE) of a Cypriot employer for more than 90 days in a tax year;
+ First €19.500 of income is fully exempt from;
+ Cyprus tax; No tax on any lump sum received as a retirement gratuity;
+ 5% tax on pension received from abroad exceeding €3.420;
+ No estate duty, wealth, gift or inheritance tax.
How we can help
We can assist you to get your Cyprus nondomicile status and Cyprus tax residency status
We can assist you to register with Cyprus Tax authorities and fully comply with Cyprus taxation laws.
Please contact us for a free personal consultation on:
The authors expressly disclaim all and any liability and responsibility to any person, entity or corporation who acts or fails to act as a consequence of any reliance upon the whole or any part of the contents of this publication.
Accordingly no person, entity or corporation should act or rely upon any matter or information as contained or implied within this publication without first obtaining advice from an appropriately qualified professional person or firm of advisors, and ensuring that such advice specifically relates to their particular circumstances.
PKF Cyprus firms are member firms of the PKF International Limited network of legally independent firms and do not accept any responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.