0% Tax on Dividends received
Dividends received by Cypriot tax resident companies are exempt from Cyprus tax subject to minor exceptions.
0% Withholding tax on Dividend payments.
Dividends paid by a Cyprus tax resident company to its non-Cyprus resident shareholder(s) are not subject to any withholding tax in Cyprus.
0% Tax on trading/sale of titles or shares.
The disposal or transfer of titles is exempt from all taxes. Titles are described as shares, bonds, debentures and similar titles as well as rights thereon.
0% Capital Gains Tax
is paid in Cyprus on the transfer of immovable property owned by a Cyprus tax resident company abroad (outside Cyprus).
Cyprus tax legislation
provides that 80% of the net income received by a Cyprus tax resident company on Intellectual Property (“IP”) it owns is exempt from taxation.
0% Estate Duty
is payable on the inheritance of shares in case of the death of a shareholder.
Double Tax Treaties:
Cyprus boasts an extensive network of tax treaties, currently with more than 45 countries, including countries in North America, Western and Eastern Europe as well as emerging markets such as China, India and Russia.
Losses
can be carried forward and set off against future profits for the next five years.
Group relief:
Set off of the loss of one company with the profit of another is allowed provided both companies of the group are tax resident in Cyprus.
Thin Capitalisation Rules:
Cyprus does not have any thin capitalisation rules or minimum capitalisation requirements.
No VAT for Holding Companies.
Holding activities fall outside the scope of the VAT in Cyprus and the Cyprus holding company engaged exclusively in holding activities is not entitled or obliged to register for VAT purposes.
0% Withholding Taxes on Interest and Royalties
There are no WHTs on interest payments made by a Cyprus tax resident company. There is also no WHT on royalties arising from sources outside Cyprus. Royalties arising from the use of an asset within Cyprus are subject to 10% WHT.
No Tax on Liquidation:
No capital gains tax, income tax or any other taxes arise on the liquidation of a Cypriot company owned by nonresident shareholders.