Cyprus Limited Company Incorporation. In Four Days!
Quick Facts About A Company Set Up
Cyprus Limited Company Incorporation : A Cyprus limited company is a private limited liability company or a Cyprus I.B.C. or a Cyprus Holding Company or a trading company or simply a Cyprus company. It is a company limited by shares. It is the most common form of company used by locals and international clients. A Cyprus company is a the most powerful tool for you to reduce your taxes dramatically. Our Firm since 1979 has been offering company incorporation services to thousands of international investors.
Cyprus Limited Company Incorporation: Before you open a Cyprus Limited Company, read the following, which will convince you that you are doing the right thing. Cyprus is a large island smack in the middle of the Mediterranean with 360 days of sunshine and a local cuisine that blows the taste buds! Since its accession to the EU Cyprus offers great opportunities to international entrepreneurs for their Cyprus company set up, for exploring the friendly tax regime of the island for tax optimization purposes. Access almost 300 M people in the EU!
Corporate tax for a Cyprus Limited Company, is only 12.5%, no tax on dividends paid out or received by the company, no tax on profits from trading in securities, not tax from profits of permanent establishment abroad, not tax from profits on the sale of real estate abroad, only 2.5% tax on revenues from IP property and so on… So go ahead to open a Cyprus Limited Company and reduce your taxes. You deserve it.
Cyprus Limited Company Incorporation: Facts and Procedures
There are various types or legal entities for a Cyprus company set up, but in this article we are going to talk about the Cyprus Limited Company which is the most common type of company used. See some quick facts about it, which will help you understand the nature and usefulness of this company. Its most common characteristics are the following:
- Before committing to a Cyprus Limited Company Incorporation, its name must be approved. The word Limited or Ltd must appear at the end of the company`s name.
- The minimum shareholders are one and the maximum fifty. Shares cannot be offered for sale to the public.
- No bearer shares are allowed. The minimum value of each share is 1 Euro. The denomination of the shares must be in Euro or any other international currency.
- The minimum capital can be 1 Euro and there is no maximum limit. There is a tax of 0.6% on the capital at the time of setting up a Cyprus company, which is paid only once. The capital does not have to be paid at the time of opening a Cyprus company!
- The shareholders of a Cyprus ltd are not responsible for the debts of the company, only to pay for their shares.
- A nominee shareholder can be used for secrecy and tax residency of the company.
- The minimum number of Directors is 1. There is no maximum number of directors provided for by the law. So there is no limit.
- When opening a company a nominee director can be used again for confidentiality reasons and for practicability. The majority of the directors must be local tax resident persons or companies, so the company is also tax resident in Cyprus.
- When you proceed with a Cyprus Limited Company Incorporation, a secretary must be appointed. The minimum number of Secretaries is 1. There is no provision in the law about the maximum number of Secretaries.
- After your Cyprus Limited Company Incorporation, you can open a bank account in only a few days. Opening a foreign bank account also is not a problem.
- At the time of opening a company articles of association and a memorandum must be drafted and filed.
- After its registration the company must file once a year audited accounts with the Income tax authority.
- Annual returns or financial statements must also be filed with the HE 32 form once a year.
- Once a Cyprus ltd company has been set up its file is open for inspection by the general public but the names of the real owners are never revealed.
- Mortgages, charges, purchasing of real estate etc must be filed with the company Registrar.
Cyprus Limited Company Incorporation: What Do The Articles of Association Include?
The articles of association of a Cyprus Limited Company are basically an agreement between the shareholders which regulates the relations between them, and between them and the directors and the secretary. They also provide for the following which is not an exhaustive list of regulations. They can be changed at any time of course:
- The payment of dividends.
- The annual and the extraordinary general meetings of the shareholders.
- The voting rights among the board of directors, how they resign and replaced, and their rights and duties towards the company i.e. the shareholders.
- The rights of the shareholders to replace the directors and the secretary.
- The ability of the company to get loans and mortgage its property and to give loans to the directors.
- And finally the winding up of the company voluntarily or by order of the court.
What Is The Memorandum of Association?
Cyprus Limited Company Incorporation: The memorandum of association of a Cyprus ltd is the official document of the company drafted when you open a Cyprus company and filed with the Registrar at the time of setting up the company, which declares the following:
- The name of the company.
- It stipulates in great detail the objects of the company i.e. the activities of the company. Such objects are usually many pages and they stipulate more than 50 of 60 different types of activity. This is very important because any activity of the company not included in the memorandum can be ultra vires the company and therefore void or voidable!
- On its incorporation the company must also declared the address of its registered office. This is necessary by law and it must be situated in Cyprus.
- In the memorandum the capital is also declared. At the stage of setting up a company the capital can be nominal or issued and the shares can be or any type stipulated such as usual shares or voting or non-voting, with preferential rights or no rights.
- Lastly the memorandum must give full details of whom the Shareholders are and their full address and profession.
How To Incorporate A Cyprus Limited Company?
In order to open a Cyprus company you need to provide the following information and documents. These will assist us to prepare the memorandum and articles of association, to fill in the forms necessary for the company set up and of course the know your client procedure. The basic requirements for you to open a company are:
- A good copy of the picture page of your passport.
- Your residency address.
- Your occupation.
- A detailed description of the proposed objects of the company.
- The capital you require for your company.
- The name of the company.
- If the shareholder or director of the company is another company or other legal entity, then all the information and documents of the company and its directors/shareholders/secretary/real owner/signatory are required.
- Fill in our questionnaire which basically collects the above information.
Our firm has been opening Cyprus companies since 1979. Our extensive experience and expertise are at your disposal. See more details on Cyprus Company Formation.
Branches Of Overseas Companies
A company which is registered abroad in any other country can register a branch of it in Cyprus. The benefit is that you get to keep exactly the same name. The operations can be carried from the headquarters in the foreign country, the staff can be employed and stationed abroad etc. Yet it will enjoy the `offshore company status` and pay tax as any other Cyprus limited company does and enjoy all the other tax benefits too. Article 347 of the Cyprus company law provides all the details and procedures for the registration of such a branch.
Cyprus Limited Company Incorporation: Tax Advantages
When you open a Cyprus company there are a lot of tax benefits to be enjoyed by the international businessman some of which are:
- Corporate Tax is calculated on the net revenues of the Cyprus ltd company at 12.5% only, which is one of the lowest tax rates in the EU.
- The tax on dividends paid out by it is zero!
- The tax on dividends received by it from shares it holds in other companies abroad is zero!
- The tax on profits from permanent establishments abroad, like hotels, restaurants, power stations, factories etc is zero!
- The tax on the profits from the sale of shares locally or abroad is zero!
- The tax on the profits from the sale of real estate abroad is zero!
- The tax on the revenues of IP property such as patents or licenses is 2.5%.
- The transfer of money in and out of Cyprus is free, no exchange controls.
- The tax on the inheritance of shares is zero!
Follow this link if you want to read more about Cyprus Company Incorporation. Details, facts and advice.
Cyprus Limited Company Incorporation
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