There is an island bathed by the warm Mediterranean ocean, older than the ancient Greeks, which has seen the invasion of Greeks, Assyrians, Romans and Crusaders, and is steeped in history, tradition, and culture.
That place is Cyprus. The island is so incredibly beautiful that this is the place where Aphrodite, goddess of love, was said to be born from the foam of the sea.
One of the many legends that define Cyprus is the Saint Mamus legend, a man who was persecuted for tax evasion by the Romans.
However, as he rescued a sheep from a hungry lion that he tamed, the courts were so impressed that they freed him form the obligation to pay taxes. So, yes, Cyprus has its own Patron Saint of tax avoidance since their old Christian times. In fact, good Christians living in Cyprus are obliged to minimize their taxes in order to honor the great saint whose tomb still can be found on the island for those of us (of The Mundo Mamus society) who venerate him.
Cyprus is a beautiful country to invest for anyone who is seeking excellent tax optimization and running away from bureaucracy and invasive statist policies. Investment funds in Cyprus are incredibly cost-efficient and easy to set-up. The regulatory framework is robust and business-friendly. There are incredible opportunities for tax optimization as most income sources from tax residents are tax-exempt. The country has enticing tax incentives and double tax treaties with more than 60 countries, including most Western countries, and little to no restrictions regarding the type of investments.
Cyprus offers foreigners a wide array of income tax exemptions. There are specific requirements, such as the relocation of the tax residency to Cyprus and applying for the non-dom status (more on that on the tax residency section.)
Mundo’s country rating is essentially a freedom index whereby our team of specialists rate a combination of freedoms which include freedom from violence and personal attacks, financial freedom from high taxes, business freedom from government interference and especially from socialism and communism.
Political stability: 9
Cyprus is a stable democratic country with a center-right, pro-business government. President Nicos Anastasiades has won two consecutive elections and conducted most of the business-friendly reforms that turned Cyprus into such an attractive investment location. The country is well-known for its fully transparent legal principles based on the common law system, an inheritance of the British rule. Even as the island allows offshore companies and has a friendly tax system, it is completely harmonized with EU and international standards.
Seeing all of what we’ve mentioned before, there are plenty of reasons to love Cyprus as an investment hub that offers enticing citizenship and residency programs for investors and incredible tax optimization and planning opportunities.
1) Tax system: A 12.5 % corporate tax rate sounds good to start. But add that there are no taxes on dividends, and profits from disposal of securities, capital gains (under certain conditions), or withholding taxes. Also, acquiring a non-dom status (more on that further down) exempts you from the defense tax. There are low social security contributions, a 50 % tax exemption for five years from the income tax for foreigners, if their personal income tax is above 100,000 EUR) (more on that ahead, too), wonderful tax credits and incentives for new investments and investment funds, and double tax treaties with more than 60 countries. There’s plenty to love in Cyprus.
The tax system in Cyprus offers incredible opportunities for those seeking tax optimization for their personal and corporate income. It is especially attractive because it comes with full compliance with international and EU standards and around sixty double taxation treaties.
The system comes with plenty of benefits for foreigners, with 50 % tax credits on personal income for those with incomes above €100k per year, and tax exemptions on passive income such as interest and dividends and tax exemptions on disposals of securities.
The first that we must discuss regarding the Cypriot tax system is its “non-dom” regime, introduced in 2015. In this program, tax residents’ that qualify as non-Cyprus domiciled are exempt from the SCD (Special Contribution for Defense) on their passive income (interests, dividends, and such) and unconditional tax exemptions on gains on disposals of securities for 17 years.
For those who can afford it, a Cypriot residency is not a plan b, a travel document, or a lifestyle choice. It is a brand that tells you that your family has the right to belong to a country that offers unlimited intergenerational freedom and wealth protection in a society of like-minded high wealth entrepreneurs. While your yacht, your sports vehicle, or mansion can be taken away by your government, your Cypriot residency is an eternal investment for your family and your children to protect your legacy and your asset. It is an investment in your future.
Amongst the numerous benefits, applicants have the fastest processing times among the EU RBI programs. You get direct residency for a €300,000 investment that can bring significant returns considering the state of Cypriot funds and the real estate market
Seeking to stimulate the economy through investment and job creation, Cyprus offers foreign nationals an opportunity to obtain permanent residence in Cyprus through investment. This is an incredible opportunity for non-EU foreigners that wish to live in the EU. The process is quite fast, as the approvals can be granted in three months.
Foreigners who open Cypriot structures with Cyprus bank accounts will benefit from an incredible variety of banking possibilities in Cyprus. More and more multinationals and Family offices are using Cyprus as a base for their operations and Cyprus banks are welcoming to foreign business.
Cyprus banks offer multi-currency accounts and many other features. Some banks even take applications without the need for visiting their offices (you can get more info from our experts). Therefore, having a company and bank account in Cyprus should be part of your diversification strategy.
We are happy to announce that Mundo has partnered with some of the most recognized experts in corporate and banking solutions in Cyprus. We are offering a unique possibility through them.
Our Cyprus package consists of the establishment of a corporate structure opening a corporate bank account in Cyprus for a preferential rate.
Starting a business in Cyprus is the best way to conduct business in the EU if you want to optimize your taxes. If you are seeking compliance with international and EU rules, tax efficiency, and stable tax planning, Cyprus is your best choice. The country offers plenty of opportunities to reduce your tax exposure and optimize your taxes.
Cyprus has become a top destination for companies seeking a legal way to optimize their taxes. The fact that the laws and regulations for foreign investors are the same as for local investors makes it even better.
- 12.5% corporate tax rate, one of the lowest in the EU.
- Access to over 60 double taxation treaties
- Excellent banking options, and bank accounts can be opened remotely
The Cyprus trust has been recognized as an asset protection haven for astute investors, as they merge the benefits of tax optimization with asset protection. Cyprus has all the benefits of many of the most enduring trust jurisdictions, including the fact that all income held by the trust is tax-free.
The Cyprus trust is one of the most solid asset protection tools in Europe. It can only be set aside exclusively within two years, and only if it is proven that the trust was established to defraud creditors. The trust retains control for the settlor by permitting the trustee to be a PTC (private trustee company established by the settlor or his counsel).
The trust protects your assets against bankruptcy, spousal claims, government claims, applications for spousal or extramarital maintenance, inheritance, death duties, and almost all types of claims.
Cyprus has its own word for hospitality: Flinoxia. This is culturally, almost an obligation based on ancient Greek traditions to make guests welcome, and indeed Aphrodite’s birthplace will make you truly fall in love and feel like you’re at home. Cyprus has magnificent beaches all over the place, a thriving foodie culture with some of the best restaurants in Europe, over 100 wine trails, amazing natural historical and cultural events, and a shop-till-you-drop culture intermingled by some of the best coffee houses on earth.
Cypriots of all incomes and professions work to live rather than live to work. Life is relaxed, happy, and unstrained by the world's problems. Cyprus has been around since the birth of the Greek gods. The islands have seen gods, emperors, kings, wars, economic crises, and more. And Cyprus remains the same: an island where people spend their time relaxing, socializing, eating, and enjoying their time. Indeed, like the great philosopher Epicurus, Cypriots enjoy friendship, a good meal, and all the simpler pleasures of life over the rat race.
If you are a Family Office or have a select pool of qualified investors that wish to pool their money to invest in different asset classes with light regulation, fast set-up, low management costs, and entry into the EU, with an excellent reputation, you’re in the right place. You’re looking for a Cyprus Alternative Investment Fund (AIF).
Our appointed experts can assist you in establishing a fund, appoint a manager, and obtain registration with CySEC. We can also help you establish relations with a reputable Cypriot bank in very little time. The AIF fund is an ideal structure for project-funding due to its plethora of double taxation treaties and an excellent pool of management talent.
Cyprus has become one of the top choices for investors seeking beneficial fund solutions. The CySEC supervises the investment market, including the emerging asset management market. The robust regulatory framework has turned Cyprus into one of the most attractive jurisdictions for investors. Likewise, the country has an aptly prepared competitive workforce filled with competent service providers.
Cyprus has become a first-level licensing jurisdiction in Europe. The first reason why is, clearly, its top corporate tax system (a mere 12.5%). Second, the most popular licensing jurisdiction in the EU was the UK, which means that, after Brexit, the situation has changed. Many have looked at Cyprus as the most effective way to enter the European market with a license with full passporting rights. Third, it has a reputable regulatory entity, the Cyprus Securities and Exchange Comission, which is tough, but fair and transparent. Fourth, licensing processes are normally swift, transparent, and not as expensive as in other jurisdictions.
Cyprus is unrivaled for financially-oriented family offices wishing to establish their own financial businesses in Cyprus and for financial investors looking to gain entry into the European market.
Real estate continues to be a privileged investment for any family office. There is a good reason why almost all CBI programs offer a real estate investment option. If you choose correctly, a real estate investment can provide you with a steady flow of relatively easy passive income for decades. And one of the best places to make such an investment is Cyprus.
Real estate has seen significant growth in the last few years in Cyprus. This surge in the market has two main reasons: 1) Increased trust for investors thanks to the pro-business reforms and 2) The residency and citizenship programs.
As we explained in our CBI section, investing between 2 and 2.5 million euros in residential or commercial real estate is the first step to acquiring Cypriot citizenship by investment. Likewise, there is a smaller investment program to obtain the fast-track permanent residence in Cyprus, where you must invest at least €300k to get it.
The country has two Free Trade Zones: the Larnaca Free Zone and the Free Ports of Larnaca and Limassol. The businesses that operate within their areas are subject to few custom formalities and can import machinery, equipment, and raw materials wholly duty-free. Their foreign employees are liable to only 50 % of the regular income tax rates.
Companies operating in the Cyprus free zones can import non-Community and Community goods into the country. Community goods are usually for export to other EU countries. Non-Community goods cannot be sold freely but are meant exclusively for sales and use in Cyprus. However, non-EU products in these zones are not subject to VAT, excise tax, or import duties.
About Cyprus Foreign Policy
When talking about investment, the options in Cyprus are countless. Starting with renewable energy, real state, gas, oil, shipping, and many more this paradise is calling investors from all around the world to expand their activities in Cyprus. This with a strategy of five pillars and twelve action points following the best practices in Europe.
The strategy is focused on the attraction of investors in high value-added businesses such as the shipping industry, high technology, innovation, pharmaceutical, and biotechnology sectors that according to the authorities are considered essential for the future sustainability of the Cyprus economy.
Cyprus is a unitary presidential representative republic. this means that the president is the head of state and the head of Government. The three main powers are exercised by the government (Executive Power), the parliament (Legislative Power), and the Supreme Court (Judiciary Power).
Ministry of Commerce, Energy, and Industry in Cyprus, this ministry manages the energy sector, drafts trades laws, and agreements. Works to promote the industry in Cyprus.
Ministry of Finance: The mission of the Ministry focuses on economic policy and coordinates its subordinate departments.
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