Set up company in Cyprus

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    Today, Cyprus is one of the most attractive countries for foreign business investors.

    Set up company

    An effective and highly organized business environment, combined with an enterprise income tax rate of only 12,5%, is one of the reasons for its popularity. If you are thinking of starting a European business, you should turn your attention to Cyprus. In this article, we’ll explain about the company formation in Cyprus.

    Why set up an offshore company in Cyprus

    Since 2014, this island is no longer on the offshore list. But Cyprus entered into agreements banning double taxation with 27 countries, including most Western European high-tax countries, and many Central and Eastern European countries. The island is low taxing, the island is a particularly advantageous place for developing companies. The legislation favors foreign investors who wish to create companies here.

    Island state membership in the EU offers good prospects for partners in Europe. Also, Cyprus’s economy is strong and stable, and the cost of doing Cyprus offshore company formation is usually low. Of decisive importance for the choice of the business, the sphere is the favorable geographical location of the island, its natural and historical resources: warm waters of the Mediterranean Sea, plenty of sunshine, beautiful beaches, historical monuments.

    Ways to register a company in Cyprus

    Those who decide to open an offshore company in Cyprus should consider a few nuances. The main legal act governing the activity of businesses on the island is the Companies Act, in its wording. Business registration is carried out using the following organizational and legal forms:

    • Private company limited by shares – a private limited companionship;
    • Public company limited by shares – is quite similar to the private one. The difference is that the shares are freely transferable and there are no restrictions on the number of shareholders;
    • Company limited by guarantee – is usually formed for charitable or non-profit purposes;
    • Partnership – are formed by two or more partners who want to invest in Cyprus;
    • Sole proprietorship – is the simplest business form in Cyprus. It is owned by a single individual who has full liability.
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    Registration of business includes many operations: necessary approvals and collection of a package of papers, registration of companies in Cyprus with the opening of an account in a local bank, registration with local authorities.

    The registration of a Cyprus company is easy and straight forward. Strictly spoken Cyprus company formation and Cyprus company registration are two different procedures, where the Cyprus company registration completes the Cyprus company formation.

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    Required documents

    To open a company in Cyprus you need to prepare a minimum package of papers for the Cyprus registrar:

    1. The constituent documents – the charter of the companionship, the constituent agreement.
    2. Licenses for the type of activity (if necessary).
    3. Copies of certificates of the identity of directors.

    The documents must be in English and signed by a lawyer entered in the special register. The client will receive an English-language translation of the document certified by the registrar.

    When registering online, you will need:

    • Scan of the copy of the constituent documents;
    • Memorandum;
    • List of directors, secretaries – form HE3;
    • Companionship address – form НЕ2;
    • A statutory declaration by Lawyer (form HE1).

    Registering Private Company Limited (LTD)

    The main characteristics of LTD are:

    • no minimum fixed capital is required;
    • number of members from one to fifty;
    • Must have one director .;
    • Yearly reports must be submitted in English and audited.

    The registration consists of five steps:

    1. Reservation of the companionship name and obtaining initial permission from the Company Registrar.
    2. Preparation by the lawyer of the founding contract and the charter of the companionship.
    3. Submission of documents to the Registration and Liquidation Department.
    4. Registration with the Tax Department to obtain an individual tax number and VAT number.
    5. Registration for social contributions in the Ministry of Labor, Social Security and Social Insurance (1 day, at one time with the pre-procedure).
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    Public Company Limited (PLC) formation

    The main characteristics of Public Company Limited (PLC) formation are:

    • The minimum share capital is EUR 25 650;
    • A minimum number of members – 7, maximum – unlimited.
    • Must have at least two directors.
    • The financial statements must be audited and signed by a licensed Cyprus auditor.

    The registration consists of five steps:

    1. Reserving companionship name and getting initial permission from Company Registrar.
    2. Preparation by a lawyer of the Founding contract and the Company Charter.
    3. Submission of documents to the Department of registration and liquidation of enterprises.
    4. Registration with the Tax Department to obtain an individual tax number and VAT number.
    5. Registration for social contributions in the Ministry of Labor, Social Security and Social Insurance.

    Company formation steps in Cyprus

    Setting up a company in Cyprus, given the traditionally friendly corporate law of this country, does not present much difficulty. Three steps are necessary to complete the procedure:

    Step 1
    Before you start a business in Cyprus, you need to choose a business name. Island state law disallows the registration of companies with the same name, so the selected variants of the name must be checked. Also you can check the name on the official website
    Step 2
    Registration of the companionship in the register and legalization of corporate documents. This procedure takes about seven working days.
    Step 3
    Opening a bank account. To date, account details can be provided within one business day, and the bank account itself will be ready in seven to ten business days.

    This ends the process of registering. The owner receives a package of corporate documents and can use the companionship for its designed purpose.

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    How long does it take to register an offshore company in Cyprus?

    Registering, including the name chosen by the client, takes about 15-20 business days.

    Re-registration of a ready-made, so-called shelf companionship, takes 5-7 business days if the companionship has a nominal shareholder, and about 10-15 business days, if the companionship changes shareholder, including the submission of information to the registrar of companies for making changes to the Company Register and obtaining a new apostille shareholder certificate.

    The cost of registering a business will depend on whether you do it yourself or ask for the assistance of a lawyer. The cost of holding the company will include the payment of the license renewal procedure.

    Benefits to open a company in Cyprus

    Benefits to open a company in Cyprus
    Registration of a company in Cyprus is quite simple, but today Cyprus is not an offshore zone in the literal sense.

    Some businessmen are scared by this item in the context of privacy. However, it should be noted that Cypriot law provides that every local lawyer is obliged to save information on beneficial owners. Privacy is also ensured through the use of the services of professional nominee directors and shareholders.

    It is often the case that a legal entity acts as the founder of an offshore companionship formation. In this case, it is necessary to provide copies of the founding documents of the founding companionship to register a new or completed Cyprus company. 

    Quick and easy offshore company formation in Cyprus

    Registration is fast and as confidential as possible for you. set up a companionship in Cyprus and get a so-called non-dom status, which provides for a stay of at least 60 days on the island, together with doing business or employment in a local companionship, and providing tax exemptions for foreigners of Cyprus. In this case, Cyprus residents receiving non-dom status are exempt from tax regardless of the country where they received their income.

    On completion

    In 2020, the private company continues to be the most popular legal form of business. Although the state is no longer an offshore area, there are favorable conditions for new business ideas and businesses: the lowest tax rates in the EU, preferential nationality for investment.

    Cyprus location

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