Thinking of starting your own business in Cyprus? Here are some key points you have to know about Cyprus Start-up Visa Package

Cyprus Start-up Visa is the ‘business passport’ of entrepreneurs outside the European Economic Area (EEA) or European Union (EU) to establish their own start-up business in Cyprus. Start-up visa is among the schemes that the Cyprus government offers to entrepreneurs to help them develop their own business ideas in Cyprus.

History & Growth

The Ministers of Cyprus implemented the idea of Innovative Start-up businesses in 2017 with the aim of attracting talented entrepreneurs coming to Cyprus to growth-hack their innovative start-up.

The scheme concerns entrepreneurs (individuals or teams) from third countries that wish to reside and work in Cyprus wishing to establish/operate/develop a start-up growth potential.

The Cyprus Start-up Visa scheme operated on a pilot basis for two years from Feb 2017 to Feb 2019. The government has recently extended the scheme for another two years (2019-2021).

The goal for Cyprus is the promotion of innovation and research and ultimately the economic and business development of the country. Additionally, the creation of new jobs in the market of Cyprus will help to reduce the unemployment rate.

Requirements & Benefits

The scheme can be applied into two forms, either for an individual or a team start-up. Along with the requirements, entrepreneurs are expected to have prepared a Business Plan, including, amongst others, business goals, methods to achieve those goals and the time frame. Outlined below are some of the criteria for applying and qualifying for the benefits under the scheme.

Requirements of individuals

1. Candidates must be residents from Non-European Country and outside European Economic Area (EEA)
2. The founder shall have access to EUR 20,000 in order to benefit from the scheme which may include capital funding, crowdfunding or any other sources of funding
3. Knowledge of Greek and/ or the English language
4. Head offices to be located in Cyprus, as well as any management decisions to be taken in the country
5. Holders of an undergraduate degree or any equivalent professional degree
6. Must be the sole founder of the business and majority shareholder

Qualified innovative company:

A company is qualified as innovative if:

1. Does not operate in any other market or
2. Operates in any other market for less than seven years from the date of its first sale or
3. Needs initial investment for a new product or introduction to a new market of more than 50% of the average turnover of the prior five years.
4. Has a verification from external auditors that the costs regarding its research and development are no less than 10% than of its operating costs, between the last three years since the submission of the application. In the case of a new enterprise, the evaluation will be based on the Business Plan of the applicant.

Benefits for the founders

1. The right to economic activity and permission to stay in Cyprus for one year, with a potential of a further year of extension
2. Right to self-employment or right to paid employment in his/her registered company in Cyprus
3. An evaluation regarding the success or failure of the enterprise will be held by the end of the 2^nd year of operation
4. In case the enterprise turns out to be successful, the individual will have an unrestricted duration of residence in Cyprus, enjoyment of family reunification and potentially recruitment of a specific number of non-European Union national personnel, without the need to obtain the prior approval from Labour Department
5. Employees will have the luxury to be taxed as residents of the Republic of Cyprus
6. The shareholders will have reduced tax regarding their income and tax exemptions based on the local tax

For Teams:

1. Candidates must be residents from Non-European Country and outside European Economic Area (EEA)
2. Maximum of 5 individuals. More foreign employees may be employed by obtaining the approval of the Department of Labour.
3. Possession of more than 50% of the company’s shares
4. All the individuals need to have a very good knowledge of Greek and/ or English language
5. The founder shall have access to €10,000 in order to benefit from the scheme and if there are more than one founders, they shall have access to €20,000, which could include capital funding, crowdfunding or any other sources of funding
6. At least one of the individuals to have an undergraduate degree or any equivalent professional degree
7. Inclusion of at least one founder who meets the requirements of the energise below, with senior executives, without exceeding the total of 5 individuals. The senior management team must be to the 3^rd level of administrative hierarchy (managers) and have the right to stock options.

Benefits for the founders

The teams that will be allowed to participate in the Team Scheme will have the following benefits:

1. The right to economic activity and permission to stay in Cyprus for one year, with a potential of a further year of extension
2. Founders have the right to paid employment in his/ her registered company in Cyprus
3. Senior executives have the right to paid employment in a company that the founders will register in Cyprus
4. In case the enterprise turns out to be successful, the individual will have an unrestricted duration of residence in Cyprus, enjoyment of family reunification and potentially recruitment of a specific number of non-European Union national personnel, without the need to obtain the prior approval from Labour Department
5. An evaluation regarding the success or failure of the enterprise will be held by the end of the 2^nd year of operation
6. Employees’ tax will be treated as they are residents of the Republic of Cyprus
7. The shareholders will receive reduced income tax, deductions and tax exemptions based on the local tax legislation

Steps for start-up visa

How we can help

C.X Financia can assist you in setting up your business in Cyprus and managing all the formalities in the process of operating your innovative business. See below our range of services

1. Corporate services: Company formation, Tax and Social Insurance registrations.
2. Banking services: Bank Account opening Services.
3. Tax services for both the Company and the owners/employees.
4. Human resource management: Assistance in hiring local and overseas personnel.
5. Advisory services.
6. Compliance and taxation services.
7. Audit and Assurance service