A Cyprus IBC In Four Days
Benefits of a Cyprus IBC
A Cyprus IBC is a common private limited liability company. It has its Directors, Shareholders, a Secretary, Registered Office and Capital like any other common companies do. It enjoys many tax privileges and tax benefits and it is the perfect tool for your offshore tax planning.
Constituents of a Cyprus IBC
- At least one Director
- At least one Shareholder
- At least one Secretary
- At least 1 Euro capital or more
- A Registered Office Address in Cyprus
- A name approved by the Cyprus Company Registrar.
- A memorandum and articles of association
The corporate tax rate for a Cyprus IBC is only 12.5% and 0% tax on dividends! That means that it pays 12.5% tax flat! In many countries corporate tax and dividend tax together add up to as high as 65%.
If you need more details about Cyprus company formation procedures, costs, time schedule and formalities generally please follow this link: Cyprus Company Formation. An IBC Cyprus is a complete and separate legal entity from the people that make it up.
It is born when it is in fact incorporated and registered at the Companies House by the registrar of companies. Its main constituent elements are the name of the company, which has to be approved and registered the directors, the shareholders, the secretary, the registered office and the capital of the company.
This type of company does not need any special business license to trade or to offer services inland and abroad. It has to register with the income tax authorities and get a vat number if it will be trading within the EU.
It can own immovable property, and it is exempt from capital gains tax if it owns and sells property at a profit abroad and its profits from any intellectual property rights are also exempt from corporate tax by 75%, that is it pays only 2.5% corporate tax! It is also taxed at 0% corporate tax on the dividends paid out to the shareholders.
That is also so for all dividends received by a Cyprus IBC from any companies in which it is a shareholder! Make it the key tool to your international tax planning. It has many more advantages. We will be glad to give you more information if you are interested. See also IBC Cyprus, for more information on the subject.
The Company Law For the Cyprus IBC
The main legislation under which a Cyprus IBC company is incorporated and regulated by the Registrar, is the Company Law, Cap. 113 of 1951. Under the provisions of this law any foreign physical person or legal entity can be the owner of it. A very tight and concise set of regulations are provided by this law for its operation and legal compliance. Cyprus legislation contains the right of taxation on preferential terms for the companies belonging to non residents by virtue of the many double tax avoidance treaties signed with over 42 third countries.
This makes it the most effective vehicle for you to plan your tax so that the minimum possible corporate taxes are paid legally thus making this company a very powerful tool for your offshore tax planning. This company can either be tax resident if its management and control is in the country, or it can be non tax resident if its management and control is outside Cyprus. There are other types of Cyprus IBC companies, such as a company limited by guarantee, a partnership, a public company. The most common form however is the limited liability company, by which the Shareholders have no responsibility for the debts of the company.
Registration Procedure For Cyprus IBC
The procedure for the registration of a Cyprus IBC is fairly simple. If you get in touch with us we will simplify it to the point where it becomes pleasant incorporating it. First you must choose a name for it. Then you must decide who the Directors will be of your company. If you need anonymity you can ask us to appoint nominee directors for you, from people of our office who are highly trained and trusted. Also you must decide who the Shareholders of the company can be i.e. the people who will own the shares of the company.
Again if you don`t want to be the Shareholder overt in your company, our firm can make available to you nominee shareholders who will hold the shares on your behalf. These people will charge you a yearly reward for their services which is usually very fair and it is always agreed with the client beforehand.
Lastly you must decide what the capital will be depending on the actual needs of your operations. Usually 1000 shares of 1 Euro each are issued. There is no maximum limit to the shares such a company can issue. There is a tax of 0.6% on the capital issued by on the day it is incorporated or if it is later increased. If you need to see our prices and fees for our company formation and other legal and corporate services please follow this link.
The Double Tax Treaties
Cyprus has signed double tax treaties, with many countries all over the World, which makes it a jurisdiction very attractive for international tax planning. If you want to check whether you country has a Double Tax Treaty with Cyprus please follow this link: Double Tax Treaty List.