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Tax Incentives

Reap the benefits from one of the most competitive corporate tax rates in the EU.

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Cyprus, a low tax jurisdiction, fully aligned with:

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The EU’s acquis communautaire and Code of Conduct.

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The Organization for Economic Co-operation and Development.

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The Financial Action Task Force.

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The Financial Stability Forum.

Cyprus features an advantageous tax system with a lot of benefits including:

Corporate Income Tax Rate at 12.5% - one of the most competitive corporate tax rates in the EU applied to worldwide income for Cyprus tax resident companies

Cyprus does not impose income or capital gains tax on the profits and gains derived from the disposal of securities

Divident income is exempt from tax irrespective of its source, under certain conditions. Dividents paid to non resident shareholders are exempted from withholding tax in Cyprus

Cypriot companies can be used to hold real estate or other assets outside Cyprus with no capital gains tax implications on disposal of their shares or of the assets

Profits from a permanent establishment maintained abroad are generally exempted from tax in Cyprus

The headline VAT rate in Cyprus is 19%, one of the lowest in the European Union

Cyprus has fully adopted the EC Merger Directive and therefore where a transaction is a "reorganization", it is exempted from income tax, capital gains and transfer fees

Favorable treatment of tax losses. Tax losses can be carried forward for set off against future profits with no time restriction

The current year loss of one company can be set off against the profit of another provided the companies are Cyprus tax resident companies and are members of teh same Group

Personal income tax rates are progressive with the first 19,500 euros of an individual's annual taxable income being tax free. Cyprus top marginal tax rate of 35%   on income in excess of 60,000 euros per annum is one of the EU's lowest ceilings