Cyprus Company: An EU Entity With Non-Dom Status

Why Cyprus

Cyprus is an EU member, operates on a common law foundation and holds a broad network of double taxation treaties. Its corporate tax rate has been among the lowest in the EU for years, and the exact rate is being adjusted through ongoing reform, so we confirm the current position on the call. For entrepreneurs who want to stay inside the single market it is one of few realistic locations.

What is included

Included are structural planning, incorporation through the local partner, registration with the tax and social authorities and support with opening a bank account. On top of that comes the residency and non-dom application with the required evidence. Ongoing bookkeeping, annual accounts and the statutory audit are organised through the partner.

Non-dom status explained

Someone who is tax resident in Cyprus but not domiciled there can be exempt from the special defence contribution on dividends and interest for an extended period. That makes distributions from your own company very lightly taxed at the personal level. Contributions to the national health system still apply and belong in every calculation.

The 60 day rule

Residency in Cyprus is possible with 60 days of presence provided further conditions are met: you are not tax resident elsewhere, you do not spend more than 183 days in any other country, you keep a permanently available home in Cyprus and you hold a business, employment or directorship there. If one condition falls away, residency for that year falls away with it.

Substance and daily operation

The company needs more than an address. Management, decisions and contracts should genuinely sit in Cyprus, otherwise another state can claim the company as its own tax resident. Bookkeeping and audit obligations are binding and belong in the plan from day one.

Who this is not for

Not suitable if you have no intention of being on the island regularly, or if your team and your value creation clearly sit elsewhere. Anyone who only wants an EU invoice without building substance risks having the structure disregarded. At very small profit levels the running cost of administration and audit is simply out of proportion.

Process

After the analysis come name reservation, incorporation and registrations, then the bank account. Residency is built in parallel, because the lease and your days of presence are needed for it. Bookkeeping and the deadline calendar are set up last.

Frequently asked questions

How long does non-dom status last?

It is time limited and runs over a multi-year period tied to your residency history. The Cypriot partner confirms the exact duration for your case.

Are 60 days per year really enough?

Only if all further conditions are met, in particular the permanently available home and a business, employment or directorship in Cyprus. Otherwise the standard 183 day rule applies.

Does the company need an audit?

Cypriot companies are subject to bookkeeping and audit requirements. The annual accounts are signed off by a local auditor and filed.

Can I run the company and live somewhere else?

Possible, but risky. If management is effectively exercised from your country of residence, that country can treat the company as resident there and tax it accordingly.

What does running it cost?

That depends on scope, substance and audit effort, and we discuss it on the call. The running cost across several years matters far more than the entry price.

Is Cyprus better than Dubai?

It depends on where your clients sit and how mobile you are. Cyprus wins on EU membership and treaty access, Dubai on low taxation and travel convenience.