11
08.2023
Many entrepreneurs and investors aim to improve and minimize their taxation. One of the paths to achieving this goal is selecting a country for optimal tax residency.
That’s why an increasing number of foreign citizens are turning their attention to the beautiful Mediterranean island of Cyprus in order to change their tax residency.
And there are valid reasons for this, as Cyprus offers attractive taxation conditions that you simply cannot ignore:
🔸 Corporate tax is only 12.5%, making Cyprus an attractive destination for conducting business and investments.
🔸 0% tax on dividends, allowing you to enjoy your profits without additional obligations.
🔸 Personal income tax rates range from 0% to 35%, and the first €19,500 of income is tax-free. This significantly reduces the overall tax burden and allows you to retain more funds.
🔸 No inheritance or gift tax. This means transferring property and money through inheritance or as a gift can be done without additional tax payments.
🔸 Forget about annual property tax – it simply doesn’t exist in Cyprus.
🔸 Employer and employee contributions in Cyprus are among the lowest in the European Union. The total contribution amounts to approximately 14.9% of the employer’s salary and 10.95% of the employee’s salary.
🔸 Simple process for obtaining tax residency status. To become a tax resident of Cyprus and enjoy all the benefits, you only need 60 days of presence in Cyprus.
🔸 Avoidance of double taxation. Cyprus actively enters into bilateral agreements to avoid double taxation with many countries, providing protection against being taxed twice on the same income in different jurisdictions.
Cyprus' tax system offers favorable conditions for the taxation of individuals, which attracts foreign citizens seeking to reduce and optimize their tax obligations.
Contact us today, and our specialists will assist you in optimizing your personal and corporate taxation!
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FAQ
Changing tax residency to Cyprus can be a beneficial strategy for individuals or companies depending on their specific financial and tax circumstances. Some of the potential advantages of changing tax residency to Cyprus include:
- You only need 60 days of presence in Cyprus to become a tax resident.
- Low tax rates on income for individuals.
- 0% tax on interest and dividends.
- 0% tax on capital gains (except for gains from the sale of real estate in Cyprus).
- No wealth, inheritance, or gift taxes.
- No annual property tax.
In order to take advantage of the Cyprus tax system and optimize your tax liability, individuals have two options.
- The first approach, known as the “183-Day Rule,” involves staying in Cyprus for at least 183 days in the tax year to acquire tax residency status in Cyprus.
- The second alternative, the “60-Day Rule,” allows individuals to become tax residents of Cyprus by spending only 60 days on the island and fulfilling other conditions: engaging in commercial activity in Cyprus (owning a business or being a director in a company) or working under a contract for a Cypriot company; not staying in another country for more than 183 days; having a place of residence in Cyprus.
According to the non-dom concept, foreigners who have chosen to transfer their personal tax residency to Cyprus will enjoy tax advantages and benefits for the following 17 years after obtaining tax residency status.
With Non-domicile status in Cyprus, residents can enjoy exemptions from taxes on dividends, interest, and capital gains. Learn more: Benefits of the Cypriot tax system for individuals.
Contact us
For enquiries please fill in the form below. Our consultants will contact you with the details.
Griva Digeni 49, Chrystalla Court 1st Floor Office 11, 6036 Larnaca, Cyprus
11B Lyuteranska St., off. 23, 01024
