Review Of Cyprus Shipping: Cyprus despite its size is one of the largest ships registries in the EU. It is the fourth bigger maritime power in Europe with a quarter of all registrations.The Cyprus Tax System is Very Friendly to Shipping
Cyprus is one of the biggest Maritime Countries in the World.
Ever since the shipping registry was created, the Cypriot shipping industry grew even more and made Cyprus one of the most significant locations for many different types of maritime services, a favorable tax system, a modernized legal and financial base, low operating costs and it also has a geographical key-location as it is a “crossroad” between three continents.
The Cyprus Tax System is very investor friendly. The Corporate Tax in Cyprus is also 12,5% and 0% on Dividends. There are also many Cyprus VAT exemptions. Coupled with very efficient Tax and VAT Services in Cyprus, has helped in the way of its Shipping business to grow and become one of the largest in the world.
It is estimated that Cyprus has about for a quarter of all the registrations of ships in Europe. The Cyprus shipping registry is the tenth larger worldwide. As we can see this section is a very important factor of the Cypriot economy.
Cyprus is considered to be the larger third party ship management in Europe. A considerable number of significant ship management companies chose Cyprus as the place to establish their business.
Limassol is the city where the maritime section is mostly based in. It has the largest port at the moment and it houses a lot of specialized legal firms, insurance agencies, a significant maritime support network of shipment operators and ship financing brokerages.
As it is also well known, Cyprus has one of the lowest corporate taxes in Europe at 12,5% and not long ago a special tax system was presented for shipping companies. An exemption is also made in Cyprus from VAT regarding international transport services if they are rendered outside Europe. Exempted from Income Tax is also the income of officers and crew on board of vessels registered in Cyprus. In addition, if someone inherits shares in a Cyprus shipping company there is no estate duty and also no stamp duty is imposed on ship mortgage deeds.
Some additional and appealing aspects of tax legislation in Cyprus include tax exemption on dividends and on earnings of foreign permanent foundations and no withholding taxes on repatriated dividends, mostly royalties and interest.
Valuable information is the fact that according to the Advocates Laws of Cyprus, only lawyers are entitled to prepare all the necessary documentation for the Incorporation and Registration of Cyprus Companies and to execute all Company Registry transactions. A big plus is the fact that Company Formation in Cyprus is a very fast and simplified procedure. Incorporating a Company in Cyprus takes only 4 days. Cyprus Companies are very easy and simple in their management.
A new freight tax regime was passed by the EU commission regarding maritime transport. This fact boosts the privileges which are available to owners of vessels with Cyprus flags, ship managers and owners of vessels with foreign flags. This new tax system also broadens the tax privileges that before this new tax system only covered earnings from the managing of vessels in activities regarding shipping to cover earnings from the sale of a vessel.
Also please note that in order to make a Company Registration in Cyprus, the registration fees are quite low and very comprehensive in comparison to other jurisdictions.
In conclusion, while the economy worldwide, including the shipping industry has been damaged by the global economic crisis, Cyprus by having this very appealing tax system, with the most comprehensive Cyprus Company Registration Fees, well regulated shipping legislation, an extremely good reputation, especially regarding safety as well as for its maritime knowledge and specialized skills, Cyprus is and will remain one of the most significant regions for the shipping business world.