How to set up a company in Cyprus? If you are interested in forming a Cyprus company, below we will explain the steps needed for it.
Cyprus has managed to become a dynamic business and investment hub that can offer opportunities across a wide range of sectors to professionals, entrepreneurs, and investors from around the world. The island is attractive for setting up a company, partnership, or trust for many reasons.
What are the Incorporation steps for forming a Cyprus company?
Incorporating a company in Cyprus is a fast, easy, and tax-efficient way to conduct business within the European Union and beyond. The basic steps for incorporating a company in Cyprus are the following:
Step 1 – Pre-Incorporation
Before incorporating a company in Cyprus, investors and entrepreneurs shall decide the name of their company, the company’s registered office, director(s), secretary, shareholder(s), share capital and the memorandum and articles of association.
Prior to submitting the application for the incorporation of the company, an application is made to the Registrar of Companies and Official Receiver (the “Registrar”) in order to request the approval of the proposed company name. The Registrar will review the request and if no issues are identified, the proposed name will be approved.
Step 2 – Submission of Application
An application for the registration of the Company is submitted to the Registrar. The application is accompanied by the prescribed forms and documents including information on the company’s registered office, director(s), secretary, shareholder(s), share capital and the memorandum and articles of association.
Step 3 – Post-Incorporation
After the Registrar approves the incorporation, the company shall proceed with a number of registrations in the relevant authorities such as registration for tax and VAT purposes and registration as an employer. In addition, companies usually open a bank account with a Cyprus bank.
Step 4 – Compliance and Administration
Registered companies in Cyprus must comply with certain statutory obligations. A simple private limited liability company with no licensing requirements shall maintain accounting books, hold an annual general meeting at least once every year and submit an Annual Return to the Registrar with the company’s audited financial statements each year. The company’s compliance requirements will depend, amongst others, on the business activity of the company.
Forming a Cyprus Company – Q&A
1. Why choose Cyprus as your next business destination?
One of the main reasons entrepreneurs and investors choose Cyprus is its low corporate tax rate of 12,5% on top of various other tax exemptions and incentives. Furthermore, Cyprus offers a robust legal framework that is regularly being updated in accordance with the economic trends and technological advancements. In addition, Cyprus is the place to be for those looking to achieve a better balance between their personal and professional life.
2. What business activities can be carried out by Cyprus companies?
Cyprus companies may be used for conducting any kind of business including, but not limited to, for group financing purposes, holding of various rights (such as IP rights), ship management and ship owning.
3. What are the minimum compliance requirements for a company in Cyprus?
All companies must keep proper books of account and prepare and submit financial statements in accordance with the latest version of the International Financial Reporting Standards (IFRS). The audited financial statements are submitted each year together with the Annual Report to the Registrar of Companies and Official Receiver. Companies shall also hold an Annual General Meeting at least once a year. Generally, compliance requirement depends on the company’s business activity.
4. How long does it take to register a company in Cyprus?
Depending on the workload of the Registrar of Companies and Official Receiver, the incorporation procedure takes around 10 days to complete provided that all the necessary documents are submitted. The government has recently introduced a ‘fast track business activation mechanism’ which accelerates the incorporation process subject to the satisfaction of certain requirements.
5. Are there any minimum share capital requirements?
There are no minimum share capital requirements for Cyprus limited liability companies. The company can be incorporated with a share capital of as low as EUR 1.00 (one euro).
6. Can the share capital of the company change?
Yes. The share capital of the company can be increased or reduced subject to the satisfaction of the relevant statutory provisions.
7. I want to relocate to Cyprus – do I have to start my company from scratch?
Not necessarily. If you are thinking of transferring your company to Cyprus but are concerned with the hustle of transferring property from the foreign entity into the newly incorporated Cyprus company there is the option of re-domiciliation into Cyprus. Redomiciliation is the process under which a foreign company is transferred and registered as a Cyprus company and its legal personality continues which effectively means that the company will hold the same property and other proprietary rights as it did before. This option is available for foreign companies in countries where the legal framework permits the re-domiciliation of companies.
Do you have any questions that we can answer for you? Do send them to our internal legal advisors at [email protected].
How can CX Financia help you?
Our team consists of industry experts that can help you structure your business by offering a tailored approach depending on your needs. We are passionate about building trust and security with our clients by providing a high level of personalized service. Our range of services includes the following:
- incorporation of companies;
- drafting/reviewing shareholders’ agreements;
- providing advisory, administration, management and compliance services;
- assisting with the licensing of the company (where necessary and depending on the business activity of the entity);
- assisting you with registering with the relevant tax authorities and registering in the employers’ register;
- assisting you with finding your office spaces;
- providing tax compliance and advisory services.
You can read more information about our Company Formation services here.
We will be happy to answer any questions you may have, and provide you with the support you need. You can contact us at [email protected].