From IT Startups to Holdings: What Types of Companies Are Registered in Cyprus?

Cyprus has long become an important legal and tax hub for international business. Registering a company in Cyprus allows for tax optimization, access to the European market, and enhanced international flexibility.

Over the past few years, the number of registered companies in Cyprus has been steadily growing. According to official statistics, thousands of new legal entities — including international ones — are added every year. For instance, in the first quarter of 2025, 3,650 new companies were registered — a 16.3% increase compared to the same period in 2024.

In this article, we’ll explore why international entrepreneurs choose Cyprus, what business models are most commonly developed here, and how this jurisdiction could be the right fit for you.

Why Do Entrepreneurs Choose Cyprus for Company Registration?

• EU jurisdiction
• 100% foreign ownership permitted
• Corporate income tax rate — 12.5%
• IP Box regime — as low as 2.5%
• No dividend tax for non-domiciled (non-dom) residents
• Over 65 double tax treaties
• Simple and fast registration — from 5 working days

Most Common Types of Companies Registered in Cyprus

We’ve identified 5 key business sectors where Cyprus is not just a place of incorporation but a real tool for growth and tax planning.

1. International Trading Companies

Setting up a trading company in Cyprus is highly beneficial for businesses involved in goods supply, export, import, or logistics. For example, if your company delivers electronics from Asia to Europe or exports goods globally, you need an EU VAT number, fast logistics, a clear tax framework, and the ability to invoice in euros. Cyprus addresses all of these needs.

How it works:

• You register a trading company with an EU VAT number
• Organize logistics through a Cyprus office
• Receive 0% tax on dividends with proper structuring

Who chooses this model:

• Distributors
• Trading and procurement companies
• E-commerce businesses and marketplaces
• Suppliers working with the EU

2. IT Companies and Startups

Cyprus is one of the best choices for IT businesses, especially if you work remotely, develop digital products, or own intellectual property. Many international IT companies choose to register in Cyprus to access the European market, legally optimize their taxes, and benefit from the non-dom tax residency status, which provides exemption from dividend tax.

Who should consider registering an IT company in Cyprus:

• Software and mobile app developers;
• Startups in AI, blockchain, and fintech sectors;
• Online platforms and services with clients in the US, EU, or Asia;
• R&D teams and IP owners;
• Companies creating digital products and technology solutions.

Key advantages:

• IP Box regime – income from IP can be taxed at only 2.5%;
• Non-dom status – no tax on dividends;
• Ability to fully manage the company remotely and sign contracts with clients and freelancers worldwide.

Read more: TOP 7 reasons why IT companies choose Cyprus

3. Consulting, Marketing, or B2B Services

Are you a business consultant, working in digital, marketing, or finance? Do you have clients in different countries and invoice in foreign currencies? A Cyprus-based company allows you to operate transparently, legally, and tax-efficiently. It’s an ideal structure if you want to open a consulting firm in Cyprus and invoice in euros.

Who sets up such companies:

• Legal and accounting firms
• Digital agencies, designers, marketers
• Consultants, coaches, and project teams

What you get:

• Ability to invoice clients in euros or USD worldwide
• No tax on dividends or reinvested profits
• Option to hire remote employees and contract freelancers without needing to register in other countries

Example:

A marketing agency working with clients from the EU and the US establishes a company in Cyprus — benefiting from legal clarity, low taxes, and the prestige of EU registration.

4. Holding Companies

A holding company in Cyprus is an effective solution for international investors and business owners who seek to manage their corporate structure efficiently and reduce their tax burden. Establishing a holding structure in Cyprus is beneficial both for controlling shares in foreign subsidiaries and for managing intellectual property, investments, or real estate. Cyprus offers a flexible and transparent legal system, access to the European market, and double taxation treaties with over 65 countries.

Why set up a holding company in Cyprus:

• 0% capital gains tax on the sale of shares (subject to certain conditions);
• Exemption from dividend tax from subsidiary companies;
• The ability to manage IP rights, shares, and property — all through one Cypriot structure.

Who it’s for: A Cypriot holding structure is particularly suitable for those seeking centralized asset management, succession planning, and international capital protection.

5. Investment Funds and Private Equity Structures

Cyprus allows for the registration of both traditional AIFs (Alternative Investment Funds) and simplified RAIFs (Registered AIFs), which don’t require prior licensing and can be launched much faster. This offers great flexibility for investors seeking to create structures for specific projects — whether in real estate, securities, startups, or venture capital.

It’s also ideal for structuring family wealth, setting up multi-generational investment vehicles, or creating a private office to manage diversification, succession, and global investments.

Why Cyprus is chosen for funds:

• Transparent regulation by CySEC (Cyprus Securities and Exchange Commission)
• Ability to establish AIFs, RAIFs, and other fund types
• Convenience in managing both private and institutional capital

Cyprus — A Universal Solution for International Business

Cyprus is a stable, legally transparent jurisdiction that works equally well for startup founders and high-net-worth business owners. Both IT startups with a single founder and multinational holdings with billion-euro turnovers find Cyprus a suitable base.

Here, you can not only start a business but also build a long-term strategy — from developing intellectual property to launching investment funds.

Since 2007, Feod Group has been providing a full range of services for the registration of companies, funds, and trusts in Cyprus. Our office in Larnaca offers legal support for doing business in Cyprus.

Request a Legal Consultation with Feod Group

We’ll help you choose the optimal structure tailored to your business model and tax strategy.