Cyprus Corporate & Tax Tips
One of the main goals of registering a Cyprus company is to take advantage of the Cyprus tax legislation and the low corporate tax rate along with all other advantages Cyprus is offering to businesses.
- Management & Control criteria
Like every company worldwide, the management and control criteria should be fulfilled, hence the Cyprus company will be treated as a tax resident in Cyprus and paying taxes in Cyprus only if (among other conditions), its directors are Cyprus tax residents. As a result, the company complies fully with:
- Action 7, Permanent Establishment Action, BEPS; and
- Article 5 of the OECD Model Treaty; and
- Cyprus Income Tax Law as amended
Being a director of your registered Cyprus company, while you are tax resident outside Cyprus may have adverse tax consequences for both yourself and your Cyprus company.
- Nominee Services (through other regulated firms of your choice)
In order for you to take advantage of the above tax tip, nominee director and secretary should be appointed for your company.
Nominee services are offered only by Regulated Firms that are licensed and supervised by either:
- Institute of Certified Public Accountants of Cyprus (ICPAC); or
- Cyprus Bar Association (CBA); or
- Cyprus Securities & Exchange Commission (CySec)
In addition to the above, if you do not want your name to be publicly available as shareholder of the Cyprus company, nominee shareholder can be appointed on your behalf.
For all nominee services, trust agreements are signed on behalf of all parties involved. As stated above, this service is offered by other separate regulated firms of your choice. Our firm acts as an introducer to a number of other reputable firms where you can make your own choice. Our firm receives a referral fee for this service.
- Legalization of Agreements
It is always advisable that all agreements/contracts signed on behalf of the Cyprus company should be drafted in accordance to the Cyprus Company’s Act Cap 113 and Cyprus Tax Law.
In addition to the above, all agreements/contracts should be certified/apostilled in Cyprus. By having a certified/apostilled agreement, none of the Authorities and/or counterparty can challenge its validity. According to The Hague Convention, apostilled means certification, authentication, legalization of documents to verify their authenticity, in order to be valid internationally.
Meeting minutes keep an official account of what was done or discussed at formal meetings, including any decisions made or actions taken. They are taken during a formal meeting of the board of directors or shareholders of a company.
It is extremely important to keep excellent paper records. Over the life of your company, you will be asked on a number of occasions to provide evidence of Board approval of certain actions.
It is a statutory requirement, Company’s Law Cap 113, to maintain company minutes.
By keeping proper minutes, the Company is taking a big step in fulfilling the Management and Control criteria for Taxation purposes.
If you want more advice on Cyprus Corporate & Tax or on any other Services we provide you can contact us and get more information for free.
PHS is trusted with more than thousand of companies and it’s in Top 50 accountants in Cyprus according to “inbusinessnews” magazine.
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