How can a foreign national buy property in Cyprus?
A foreign national (a citizen of a Non EU Country) can buy property in Cyprus if he applies to the Cypriot Authorities to get a licence. The application is examined by a council of ministers. It is advisable for a foreign national to proceed for the above licence with the legal help of a Cyprus lawyer.
Does an EU citizen need a licence to buy property in Cyprus?
EU citizens can buy and transfer any property in Cyprus in their name without a licence.
Is it necessary that a Cyprus lawyer carries out certain due diligence before giving legal advise to buyers to proceed?
Cyprus lawyer must carry out the following due diligence: To carry out a search at the land registry to find out if there are any charges or mortgages on the property, To carry out a search in the Cyprus Registrar of companies to find out the financial situation of the selling company, To obtain the planning and building permits.
Is it necessary the property sales contract to be checked by a Cyprus lawyer?
The terms of a property sales contact must be check and negotiated by a Cyprus lawyer who is experienced in contracts in order to protect the interests of the purchaser.
Are there any transfer fees for buying a property in Cyprus?
Yes, there are some transfer fees which must be paid in the beginning in order to transfer the property into the name of the purchaser.
Cyprus Company Law
What is the minimum number of directors or shareholders that a Cyprus company must have?
A cyprus company must have a minimum of one director and one shareholder, according to Cyprus company law.
Is it possible to be registered as a Cyprus company without the legal help of a Cyprus lawyer?
No, as a Cyprus company can only be registered with the legal help of a Cyprus lawyer as the constitution and all necessary documents must be signed by a lawyer.
Is it necessary for a Cyprus company to have a registered office in Cyprus?
A Cyprus company, according to Cyprus Company Law, must have a registered office in the territory of Cyprus.
How much is the tax for companies in Cyprus?
The tax for companies in Cyprus is 10%.
What are the main types of companies registered in Cyprus?
The main types of companies registered in Cyprus are public companies, Ltd companies, partnerships and holding companies.
What are the advantages of Cyprus as an offshore destination?
Cyprus offers good economical and enviromental conditions, political stability, law tax, advantages on dividends and treaties between Cyprus and many countries to avoid double taxation.
How much is the time needed for the registration of a cyprus company?
The time needed for the registration of a Cyprus company is 3 weeks.
What is the minimum capital of a Cyprus company?
The minimum capital for a Cyprus company is €1,708.
Cyprus Family Law
What is the usual time needed for a Cyprus lawyer to arrange a divorce?
The usual tine needed is between 4 months – 2 years.
Which factors are important for the amount of a maintenance?
Matters most important in relation to maintenance agreements are: if the applicant is not working, if he/she have children under the age of 18 years old, the age of the children, the general economic situation of the applicant.
What is the necessary age for a person to have the legal right to marry?
The legal age for marriage is 18 years.
What are the special circumstances for the court to take into account for a divorce? What would the court consider as special circumstances in a divorce?
The special circumstances are: the financial situation of each spouse, professional aspects, physical health, mental health, the impartial rationality, or not, of the interruption of the marital life.
Is it advisable the applicant of a divorce to use the legal services of a Cyprus lawyer?
Yes, it is advisable that the applicant of a divorce uses the legal help of a Cyprus lawyer so that his/her legal rights are fully protected.
What are the usual property rights after a divorce?
The main principle is that each spouse may claim his/her contribution to the increase of the property of the other spouse. There is a presumption in Cyprus Law that the contribution of each spouse to the increase of the property of the other is equal to 1/3 of the increase, unless otherwise proven.
What is the main legal reason that a court can issue a divorce decision?
Irretrievable breakdown of the bond of matrimony for reasons attributable to the respondent, or both the spouses, so that the continuation of marriage is intolerable for the petitioner. Separation for five consecutive years constitutes Irretrievable breakdown of the bond of matrimony.
Cyprus Immigration Law
Must EU citizens be registered in Cyprus?
Yes, EU citizens must be registered in Cyprus.
How can a foreign national get a visa for Cyprus?
He must show a business invitation letter or he must come to Cyprus for tourism purposes. In case of tourism purposes the foreign national must show a ticket with return travel dates and a hotel reservation to the relevant authorities responsible for visas.
How can a person acquire a citizenship in Cyprus?
A person can acquire citizenship by registration, birth and naturalization.
How can a foreign national usually get naturalization in Cyprus?
If a person has been a legal permanent resident of Cyprus for the last 7 years before he can apply for naturalization.
Where are the applications for work permits in Cyprus submitted?
Applications for the issue of entry and work permits in general categories of employment are submitted to the Civil Registry and Migration Department by the intended employer.
What is the main requirement for long residence permit?
A foreign national must to stay in Cyprus for 5 continuing years.
What is the most usual category for a residence visa in Cyprus?
The most usual category for a residence visa in cyprus is category “F”.
Is it necessary the legal help of a Cyprus lawyer for immigration matters?
Yes, it is necessary because only with the legal help of a Cyprus lawyer will the legal rights of a foreign national or an EU citizen be fully protected.
Company Registration in Cyprus
What are the benefits of incorporating a company in Cyprus?
Cyprus is an attractive destination to form an IBC. Cyprus in general is a low tax jurisdiction. Firstly, there is no withholding tax. Secondly, the corporate tax companies need to pay on their international income is 12,50%. Thirdly, there is no tax on the transfer of shares and fourthly Cyprus accepts invoices from offshore companies and this is rare in the EU.
Apart from these, there are more advantages such as economical stability, corporate laws which are based on the English Companies Act and harmonised with EU corporate laws, low incorporation fees and a quick incorporation process. Additionally, it has an efficient network of lawyers, accountants and banks. Cyprus is at the crossroad of Europe, the Middle East and Africa. Moreover, Cyprus has numerous Double Taxation Agreements, and is also currently negotiating more.
What is the procedure which has to be followed in incorporating a company in Cyprus?
The first step is to apply to the Company Registrar to get a name approval for the company. After the name is approved, the necessary documents need to be prepared by a lawyer. The forms needed are forms HE1, HE2, HE3 (affidavit signed by the lawyer, company’s registered address, company’s Directors and secretary respectively). Moreover, the Memorandum and Articles of Association need to be prepared. These include information such as the nature of the company’s activities, the names of the company’s Shareholders and their respective shares and more. When the company is approved by the Registrar the company gets a unique registration number and its Certificates.
How long does it take for a new company to be registered?
For the approval of name, the Department of Registrar of Companies usually needs 2-3 working days if an acceleration fee is paid. Then for the company to be registered, it usually takes 7-10 working days.
Do I have to be present in order for my company to be registered?
The whole process can take place without the presence of the client being necessary. As long as all due diligence protocols have been carried out, instructions may be given through e-mail or telephone for the incorporation and later running of the company.
Are there any minimum Share Capital requirements for a Cyprus company?
The law does not impose minimum Share Capital requirements however in practice the usual start-up Share Capital amount is € 2,000. Cyprus tax legislation does not contain any provisions on thin capitalisation meaning that the Share Capital need not be proportional to the company’s assets.
What information may be disclosed about a company?
Generally all company Certificates are open for public inspection. Financial statements of the company are also open for public inspection. Some Resolutions passed by the Shareholders such as Resolution passed for a change of the name of the company are also filed at the file of the company at the Department of Companies. The names of the Director(s), secretary and Shareholder(s) are in the public domain as well. Someone can also view the Memorandum and Articles of Association of the company. However, information such as the bankers of the company cannot be disclosed.
What certified copies may be requested from the Registrar of Companies?
The certified copies which may be issued by the registrar of companies are the Director Certificates, the Shareholders Certificates, the Certificate of incorporation, the Certificate for the registered office of the company, the Certificate of good standing, the Certificate of capital and the Memorandum and Articles of Association.
Are financial statements mandatory under Cypriot legislation?
Yes, audited accounts are required and need to be filed with the Registrar of Companies and the Inland Revenue Department. Such accounts are open for public inspection. When the company is a newly registered company, the first financial statements need to be filed at the Registrar within eighteen months of its incorporation. After this, the company needs to file its financial statements every 12 months (by the end of each tax year which is December). The only exception where this is not required is shipping companies.
What are the VAT requirements for Cyprus resident and Cyprus non-resident companies?
VAT is an indirect form of taxation which burdens consumption expenditure. It is charged on every taxable supply of goods or services. It is collectable at every stage of the production. The standard rate is 15% with the reduced rate being 5%, 8% or 0%.
All transacting companies need to register for VAT to a local VAT office through the completion of VAT Form 101, which is the application for registration in the VAT Register, provided they exceed the threshold. After registration, companies are given a VAT number which they have to display on all transactions. People supplying goods and/or services are responsible for collecting the VAT and then passing it on at the VAT Service Department.
A taxable person is every person, natural or legal, resident in Cyprus or abroad, who carries on a business and has registered as such in the VAT Register or he is liable to be registered according to the provisions of the VAT legislation. Liability to register arises if at the end of any month, if the value of his taxable supplies in the period of one year then ending has exceeded € 15,600, or at any time, if there are reasonable grounds for believing that the value of his taxable supplies in the period of thirty days then beginning will exceed € 15,600. Persons who are liable to register have to notify the VAT Commissioner through VAT Form 101. Although liability to register for VAT falls on the businesses, it is not actually them who bear the cost. The seller only acts as a vehicle of the VAT Services to collect VAT from the consumers.
Can a bank account be opened for a Cyprus company outside Cyprus?
Yes. This can even be made without the need of the Directors being present to sign on behalf of the company since the documents can be sent by post or a power of attorney (PoA) could be prepared giving the client the authority to open a bank account for the company. A company registered in Cyprus may open a bank account everywhere in the world.
Can a bank account be opened in Cyprus?
Yes. This can even be made without the need of the client and/or signatory being present to sign on behalf of the company since the documents can be sent by post and authenticated by a Cyprus lawyer.
How is a Cypriot company dissolved?
For a company to be dissolved, a liquidator needs to be appointed whose job will be to collect money from the company’s debtors, pay the company’s creditors and whatever is left is given to the Shareholders. This has to be published in the Official Government Gazette. The difference with striking off a company is that when a company is struck off it is being removed from the register at the Department of Registrar and Official Receiver and this takes place when the company has no assets and liabilities.
Citizenship by Investment in Cyprus
How are Cyprus government bonds purchased for the purpose of supporting an application for Cypriot Citizenship by Investment?
It is possible to purchase Cyprus government bonds/debentures directly from the Ministry of Finance (MoF) or through the Cyprus Stock Exchange.
For the purposes of investment in government bonds as a means of obtaining Cyprus Citizenship by Investment, it has been decided that from 1st of August 2014 onwards, only the bonds purchased from the primary market (i.e. directly from the Ministry of Finance, Public Debt Management Office through the Cyprus Stock Exchange) are eligible. The minimum lock-in period for investment purposes is three years.
The applicant is able to purchase Cyprus government bonds between the 1st and 20th of each month. Payment is remitted to the bank account of the Central Bank of Cyprus. The application for purchase of government bonds can be processed by a power of attorney issued in the name of the applicant’s local advisor (i.e. lawyer).
Does a Permanent Residency Permit (PRP) help towards obtaining Citizenship?
A holder of a PRP who eventually wishes to be granted Citizenship has an advantage in that he may legally reside in the Republic for five consecutive years prior to filling an application for Citizenship by naturalisation in the traditional way (as opposed to the Citizenship by Investment route). This is the only advantage afforded even though many persons opt to obtain the PRP first, and subsequently proceed with an application for Citizenship by Investment, especially when they intend to reside in the Republic with their families.
How long is the examination period for the Citizenship application?
Upon filling of a completed Citizenship application, it usually takes between two to three months before a decision is made by the Ministry of Interior.
Is it a requirement that an applicant must live in Cyprus prior to or after Citizenship being granted?
There are no residency prerequisites either prior to filling the Citizenship application or following the granting of Citizenship. This is one of many benefits of the Cypriot Citizenship by Investment program, when compared to other EU Citizenships programs.
When does the successful applicant receive their Cyprus passport?
Once citizenship is granted, the applicant can receive a Cyprus passport on the same day simultaneously with the issuance of the naturalization certificate, if done in person in Cyprus. On that day, the applicant issues a sworn statement that he accepts citizenship and can then obtain the Cypriot passport issued by the Ministry of Interior, on payment of acceleration fees of €120. Alternatively, the applicant may obtain the Cyprus passport any time after the naturalisation certificate is issued, from the Citizens Service Centers at a lower cost of €70, but it could take up to two weeks to have the passport issued in this case. A Cypriot passport will also be issued to the Investor’s spouse and dependent children up to the age of 27, provided they are in full-time education.
What does “acquisition of businesses or companies based in Cyprus” mean precisely?
This criterion pertains to a €5m/€2.5m (depending on whether the application is submitted as a group or individual) investment in the participation rights or shares of a Cyprus company(ies) that maintains offices and operates in Cyprus, employing a minimum of five Cypriot citizens, for a period of three years.
An eligible company/business can also be one that was acquired by the Investor up to three years prior to filing his citizenship application.
In all cases, the Investor must demonstrate the correlation with the companies or businesses purchased. This requires the investor to continue to be an owner or be directly involved in the operations of the businesses acquired.
Permanent Residence in Cyprus
What are the Investment/Financial Criteria in case that the spouse of the applicant wishes to also apply for Permanent Residence Permit (PRP)?
No additional investment or deposit is necessary. The spouse may be included on the same application. Additional criteria have to be met for other additional dependents (family members).
What are the additional criteria for other dependent members of the family?
For each additional dependent member of the family the amount of the required annual secure income (€30.000) increases by €5.000. This income may consist of salaries, pensions, dividends from shares, fixed deposits, rents, etc. derived from abroad.
Is the applicant or spouse permitted to take up employment in Cyprus?
Applicant or spouse undertake and confirm that they do not intend to be employed in Cyprus in any direct or indirect manner. However, applicant or his spouse may own shares in Company registered in Cyprus and the income from the dividends of such company is not deemed an impediment for the purpose of obtaining an immigration permit.
Is it required for dependent members of the family to apply separately for PRP?
The wife and children under the age of 18 are not required to apply separately (i.e. they may be included on the permit granted to the applicant). Non married children of the age of 18-25 years, who are students and financially dependent on applicant, may submit a separate application, with all certificates required. Such PRP, if granted, is valid until the age of 25. Above the age of 25, in case the person is interested to acquire a new permit, will have to apply as an independent person.
Is the applicant required to invest the whole amount of at least €300.000 + VAT before submitting his application?
No, the applicant is required to pay at least €200.000 + VAT, irrespectiveof the date for the delivery of the property, before applying for PRP. The remaining amount due for the property should be settled by instalments in an account in a financial institution in Cyprus. All the above amounts should be sourced from abroad.
Is the applicant allowed to purchase more than one pieces of property?
The applicant may purchase up to two pieces of property of a total value exceeding €300.000 + VAT. In such a case, besides the dwelling property, (house or apartment), the applicant may purchase a shop of a maximum area of 100 square meters or an office of a maximum area of 250 square meters.
Are there any criteria as to which property qualifies for current PRP procedure?
Yes. The property should be purchased from a property development company and should not be a resale (i.e. it must be sold for the first time after its completion). Furthermore, in case of purchase of two pieces of property, this property should be sold by the same company.