Guide to setup company in Cyprus 2021

The Republic of Cyprus is a popular jurisdiction for many foreign investors and business owners who wish to set up their business offshore. This is because of its strategic location, well-developed infrastructure, business-friendly policies introduced by the government, and more. This article will serve as a guide for you containing all the information you require to register company in Cyprus.

Why should I set up my business in Cyprus?

Setting up your business in the Republic of Cyprus has its benefits including the following:

  • Strategic location:
  • The Republic of Cyprus acts as a gateway between the East and the West as it stands on the crossroads of Middle East Asia, Africa, and Europe.
  • Well-developed infrastructure:
  • The Cypriot government is actively trying to improve the infrastructure available in the country.
  • Cyprus has a well-developed transportation infrastructure with five major seaports, nine major airports, roads, and more.
  • Tax benefits and incentives:
  • The Cypriot government levies a low corporate tax rate of 12.5% which is relatively lower than the worldwide average statutory corporate income tax of approximately 24% which is measured across 177 jurisdictions.
  • Besides, the government offers various tax exemptions to businesses including exemption from withholding tax, sales tax, capital gains tax, and more.
  • Complete foreign ownership:
  • The government allows foreign investors and business owners to have complete ownership over their business in order to attract foreign direct investment to the country.
  • Strong relations with other countries and organisations:
  • The government of Cyprus has established bilateral relations with approximately 180 countries from around the world.
  • Cyprus is also a part of various organisations including the European Union, Union for the Mediterranean, and more.
  • These relationships formed by the government allows for effective trade with potentially lower trade tariffs. Businesses can take advantage of the same.

How do I incorporate my business in Cyprus?

In order to incorporate your business in the Republic of Cyprus in a smooth and hassle-free manner, you need to understand the steps that needs to be undertaken which includes the following:

Step 1: Choose an optimum business structure:

  • Prior to incorporating your business, you need to select a suitable legal entity for your business.
  • The Cypriot government allows businesses to set up the following legal entities:
  • Sole Proprietorship
  • General Partnership
  • Limited Partnership
  • Limited Liability Company
  • International Trust
  • Foreign Office
  • Based on your business activity, requirements, and long-term business goals, you need to decide a suitable business entity for you.
  • Each of these entities have different requirements that you will need to meet before you can incorporate your business. Therefore, this is an important decision to be made.

Step 2: Meet all the pre-registration requirements:

  • You must meet all the requirements of your chosen business entity including obtaining a local office address, nominee director, and more.
  • You are then required to prepare all the required documents including the following:
  • Business Plan
  • Articles of Incorporation
  • Memorandum of Association
  • Articles of Association
  • Proof of address
  • Power of Attorney
  • Other incorporation documents
  • The above-mentioned documents must be in Greek language. If it is in a different language, then you must get it translated and certified by an affidavit or by one of the sworn translators of the Republic of Cyprus.
  • You must also check for the availability of your preferred business name on the Cyprus Registrar of Companies’ business entities register and apply for the reservation of the same with them.

Step 3: Register your business

  • Once all the pre-registration requirements are met, you must submit an application along with the prepared documents through the e-filing system of the Registrar of Companies.
  • Once the authorities grant approval, you can collect the Certificate of Incorporation, Memorandum and Articles of Association, Certificate of Directors and Shareholders, and more. The company registration number is written on the Certificate of Incorporation.
  • This entire process can be completed virtually and hence, you will not be required to travel to Cyprus.

Step 4: Register your business for tax:

  • Once the incorporation process is completed, you can register your business for tax with the Tax Department to obtain the required tax number by filing this form.
  • If needed, you may be required to register your business for Value Added Tax by completing a supplementary form.

Step 5: Open a corporate bank account:

  • You need to open a corporate bank accountfor your newly incorporated business with a suitable and reputable bank.
  • Banks in Cyprus allows business owners to open bank accounts virtually such that you will not be required to travel to Cyprus for this.
  • Moreover, businesses are not required to make any minimum deposit.
  • Some of the banks with which you can open a bank account are the Bank of Cyprus, Cyprus Development Bank, and the Hellenic Bank.

Step 6: Register your business for Social Insurance:

  • You will also need to register your business with the Social Insurance Servicesby submitting the required application form.

Step 7: Register your business for Trademark:

  • You must register your business’s trademarkwith the Intellectual and Industrial Property section to protect your business products and services from being copied and to differentiate them from others in the market.

Step 8: Staying Compliant:

  • Even after the registration is completed, you will need to continue to ensure that your business is in compliance with the government policies by making the timely preparation of the business’s financial statements, filing for annual tax returns, and more.

The entire business registration process should be completed within a period of one weeks. Once the registration is completed, you can open a bank account within four weeks for your business. All in all, your business registration will be completed within a period of five weeks.

Throughout this process, you will also be required to make payment of government fees in order to incorporate your business. The total payment that is needed to be made will depend upon your chosen entity, your business activity, your timeline to set up the business, and more.

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