Since Cyprus got its independence in 1961 it has become a well-developed island, with a strong and stable economy. Cyprus has also become a member of the European Union on 1st of May in 2004, adopting the Euro as its national currency on the 1st of January in 2008.
The Cyprus economy has a well-developed and progressive infrastructure, making its per-capita GDP more than the European’s Union average. However, Cyprus economy much depends upon tourism, international investments and business.
According to the law in Cyprus, only a company that is controlled and managed from inside the island is considered as Cyprus resident company for taxation. Companies in Cyprus are required to annually file VAT and tax accounts with the Cyprus Tax Department. Audits are not required.
Taxation for Cyprus branches with internal management and control is the same as international business companies i.e. 10% on the net profit. If the management and control of the branch is outside of Cyprus, all profits from the branch are exempt from tax. Cyprus based companies and organizations are obliged to pay a 3-15% Contribution of Defence Tax, which foreign resident companies in Cyprus does not have to do so.
International business branches are granted the same advantages as international business companies, i.e. low corporate tax rates, no capital gains tax, no withholding tax.
If you need further information on accountancy and tax rates in Cyprus please visit accountancyineurope.com
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