Open A Company In Cyprus

Before you open a Cyprus 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 setting up a company in Cyprus. See more details about Cyprus Company Formation. Open a company in Cyprus for exploring the friendly tax regime of the island for tax optimization purposes and be on your way to success. Set up a company in Cyprus where corporate tax is only 12.5%, no tax on dividends paid out or earned, 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 intellectual property and so on.

Types Of Cyprus Company. Set Up And Requirements

Open a company in Cyprus: There are various types or legal entities for a Cyprus company set up such as the partnership, the partnership limited by shares, the public company, the trust and others. However in this article we are going to talk about the limited liability company which is the most common type of company used. See some quick facts about it, will help you to understand when you open a company in Cyprus, the nature and usefulness of it. Its most common characteristics of are the following:

1. Before setting up a company in Cyprus its name must be approved by the Registrar. The word Limited or Ltd must appear at the end of the company`s name.
2. The minimum shareholders are one and the maximum fifty. Shares cannot be offered for sale to the public when you open a company in Cyprus.
3. No bearer shares are allowed. The minimum value of each share is 1 Euro. The denomination of the shares can be in Euro or any other international currency.
4. 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 setting up a company in Cyprus.
5. The shareholders of the company are not responsible for the debts of the company, only to pay for their shares.
6. A nominee shareholder can be used for confidentiality reasons.
7. The minimum number of directors is 1. There is no maximum number of directors provided for by the law. So there is no limit.
8. When you open a company in Cyprus 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 that the company is also tax resident.
9. When you open a company in Cyprus, 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.
10. When you set up a company in Cyprus, you can open a bank account for in only a few days. Opening a foreign bank account also is not a problem.
11. At the time of the Cyprus company set up, Articles of Association and a Memorandum must be drafted and filed.
12. After its opening a company must file once a year audited accounts with the Income Tax Authority
13. Annual returns or Financial Statements must also be filed with the HE 32 form once a year with the Registrar.
14. Once a company has been incorporated its file is open for inspection by the general public.
15. Mortgages, charges, purchasing of real estate etc must be filed.

Open A Company In Cyprus: The Articles of Association Are Basically An Agreement

Open a company in Cyprus:  The articles of association of a company are drafted and filed at the time of the company set up and 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:

1. The payment of dividends.
2. The annual and the extraordinary general meetings of the shareholders.
3. 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.
4. The rights of the shareholders to replace the directors and the secretary.
5. The ability of the company to get loans and mortgage its property and to give loans to the directors.
6. And finally the winding up of the company voluntarily or by order of the court.

For more details, information and advice on the Registration of Cyprus Company, please follow this link.

The Memorandum Of Association Defines The Activities, Capital, Name and Shareholders

Open a company in Cyprus:  The memorandum of association of a Cyprus ltd company is the official document of the company drafted when you set up company in Cyprus and is filed with the Registrar at the time of setting up the company, which declares the following:

1. The name of the Company.
2. 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!
3. 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 the country.
4. In the memorandum the capital is also declared. 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.
5. Lastly the memorandum must give full details of whom the shareholders are and their full address and profession.

How To Open A Company In Cyprus

Open a company in Cyprus:  A question frequently asked by foreign investors to us is `how to set up a company in Cyprus` and what are the formalities? In order to proceed with a company set up you need to provide our firm with the following information and documents. These will assist us to prepare the memorandum and articles of association, to fill in the forms necessary to open a company in Cyprus and of course for the know your client procedure:

1. A good copy of the picture page of your passport.
2. Your residency address.
3. Your occupation.
4. A detailed description of the proposed objects of the company.
5. The capital you require for your company.
6. The name of the company.
7. 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.
8. Fill in our questionnaire which basically collects the above information.

So we hope that we have answered your question `how to open a company in Cyprus` and that you know that you are doing the right thing.

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 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.

Tax Advantages Of A Cyprus Limited Liability Company

When you open a limited liability company there are a lot of tax benefits to be enjoyed by the international businessman some of which are:

1. Corporate tax is calculated on the net revenues of the company at 12.5% only, which is one of the lowest tax rates in the EU.
2. The tax on dividends paid out by a company is zero!
3. The tax on dividends received from shares it holds in other companies abroad is zero!
4. The tax on profits from permanent establishments abroad, like hotels, restaurants, power stations, factories etc is zero!
5. The tax on the profits from the sale of shares locally or abroad is zero!
6. The tax on the profits from the sale of real estate abroad is zero!
7. The tax on the revenues of IP property such as patents or licenses is 2%.
8. The transfer of money in and out of the country is free, no exchange controls.
9. The tax on the inheritance of shares is zero!