Starting a business in Cyprus: company formation, tax 2026 and residence through your own company
Cyprus combines an English-law-based corporate system, an EU passport for your business and one of the lowest corporate tax rates in the Union. An ordinary limited company is what most founders and holding structures use. This page gives figures and steps with sources — it is not legal or tax advice. If you stay tax resident in another country, that country's CFC rules may still apply.
Company types and who each suits
| Form | What it is | Best for |
|---|---|---|
| Private limited company (Ltd) | company limited by shares, minimal capital | most businesses: trade, services, IT, holding |
| Holding company | an Ltd that holds shares in other companies | owners routing dividends through participation |
| Branch of a foreign company | an extension of the parent, not a separate entity | entering the market with an existing company |
| Trust | assets held under a trustee | succession planning and asset protection |
| IBC | old name for an 'international' company (regime ended in 2004) | outdated: today it is just an ordinary Ltd |
Forms and rules: Companies Law, Cap. 113 (CyLaw). There has been no separate 'international business company' regime since 2004.
Registration with the Registrar of Companies (gov.cy)
Ordinary registration takes a few working days with documents ready; the accelerated procedure is faster.
- name approval (form HE1) — €10;
- Memorandum and Articles of Association in Greek, plus a certified translation if you want a translation file (+€160);
- file HE1 + HE2 + HE3 — fee €165 (€235 for a company without share capital); accelerated procedure +€100;
- receive the certificate of incorporation and the tax (TIC) and social-insurance numbers;
- register for VAT once turnover passes the threshold;
- corporate bank account — the slowest step (see below).
Company taxes — in figures
| Tax | Rate | What matters |
|---|---|---|
| Corporate income tax | 15% of profit | from 1 January 2026; it was 12.5% until 31.12.2025 (PwC, checked 11.10.2026) |
| IP box (intellectual property) | 80% deduction | effective rate of about 3% on qualifying IP profits (modified nexus) |
| Non-dom (SDC) | 0% | a non-domiciled resident pays no SDC on dividends, interest or rent |
| Dividends | mostly 0% | participation exemption — no tax when conditions are met |
| VAT | 19% | standard rate; mandatory registration threshold €15,600 of turnover in 12 months |
Interest, rent and capital gains have their own rules. Confirm rates on mof.gov.cy and on the Tax page of this edition: they are revised.
Non-dom status and the 50% exemption
| Relief | Condition | Duration |
|---|---|---|
| Non-dom status | not domiciled in Cyprus (Cyprus domicile means resident for 17 of the last 20 years) | as long as your domicile stays outside Cyprus |
| 50% salary exemption | employment income in Cyprus of at least €55,000 a year; you were not resident 15 of the previous 20 years nor in the preceding year | 17 years from the first qualifying employment |
| Effect | half the salary is not taxed; dividends and interest are covered instead by non-dom | Article 8(23A), Income Tax Law |
€55,000 is an eligibility threshold, not a tax-free slice: the deduction applies to the whole salary. The two reliefs stack. To verify: the conditions were amended (Law 32(I)/2022) — confirm with a tax adviser.
Residence through your own company
A Cyprus company is the basis to live on the island: a non-EU founder can get a temporary residence and employment permit as an employee of their own company. The company must be registered as a 'company of foreign interests' (FIC) with the Business Facilitation Unit (BFU) of the Ministry of Energy.
- the company is registered FIRST; FIC status and residence come after it;
- minimum gross salary for key personnel (including the director) — €2,500 a month;
- within five years at least 30% of staff must be Cypriot or EU nationals (70:30 rule);
- decisions on residence and work permits take about a month; foreign-staff quotas were abolished (Strategy in force since 2.1.2022, mo i.gov.cy);
- a real office in Cyprus and a foreign investment of roughly €200,000 — to verify: check the current criteria with the BFU;
Digital Nomad Visa
- for non-EU/EEA nationals who work remotely for an employer or clients abroad;
- prove a stable net monthly income of at least €3,500 (after taxes and contributions);
- permit for one year, renewable for two more (up to three in total); spouse and children join;
- cap of 500 permits; fees: issuance/renewal €70 plus €70 registration;
- after 183 days in a tax year you may become a Cyprus tax resident.
The scheme does not allow work for a Cyprus employer. Source: Migration Department (gov.cy). Terms and amounts change — check the current version.
A corporate bank account
Registration is not a bank account. Cypriot banks (Bank of Cyprus, Eurobank, AstroBank, Alpha Bank, CDB) scrutinise a non-resident director closely: source of funds and capital, nature of the business, counterparties, payment geography and beneficial owners (UBO). Opening takes weeks; a refusal may come without reasons. No agent can guarantee an account — a good one helps you prepare a complete, honest file.
Reporting, audit and penalties
- audit is mandatory for every company regardless of turnover — the auditor must be a member of ICPAC;
- annual general meeting (AGM) within 18 months of incorporation, then at least yearly;
- annual return HE32 within 28 days of the AGM, with the audited financial statements;
- corporate tax return due by 31 January of the second year following the tax year;
- late HE32 and tax filings bring fines and a 10–30% surcharge; the annual levy was abolished.
Confirm deadlines and amounts on companies.gov.cy and mof.gov.cy: the rules change. This page is not legal or tax advice.
Frequently asked questions
- Can I own a Cyprus company and not live in Cyprus?
- Yes. It can be managed on the island by a Cypriot director while you live elsewhere — then you are taxed under your own country's rules.
- Do I need to be in Cyprus for the 15% rate?
- The 15% rate applies only if the company is tax resident in Cyprus (managed from the island). Otherwise income is taxed where it is resident.
- What about reporting if I live abroad?
- Reporting and audit are still required: HE32 after the AGM, the tax return by 31 January of the second year, and an annual audit.
- Can I work in Cyprus without a permit?
- EU citizens can, after registration; others need a residence and employment permit — without it you cannot work even in your own company.
- How much does it cost to set up?
- State fees start at €175 (€10 + €165). The total with an agent, registered address and audit is higher — ask for a written quote.
To verify: fees and deadlines are revised (companies.gov.cy, mof.gov.cy, BFU). We are not an agency and do not provide legal services — check the primary source before deciding.
Sections
Company registrars
PwC CyprusCompany registrarsEN, EL
Office: Nicosia, Cyprus
Specialisation: company formation, corporate services, tax and audit
Company website: www.pwc.com.cy
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestKPMG CyprusCompany registrarsEN, EL
Office: Nicosia, Cyprus
Specialisation: company incorporation, corporate and tax services
Company website: kpmg.com.cy
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestGrant Thornton CyprusCompany registrarsEN, EL
Office: Nicosia, Cyprus
Specialisation: incorporation, accounting, tax and business advisory
Company website: www.grantthornton.com.cy
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestBaker Tilly CyprusCompany registrarsEN, EL
Office: Nicosia, Cyprus
Specialisation: company formation, accounting, audit, corporate services
Company website: www.bakertilly.com.cy
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestEurofastCompany registrarsEN, EL
Office: Nicosia, Cyprus
Specialisation: company registration, corporate and trustee services, tax
Company website: eurofast.eu
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestTotalserve Management LtdCompany registrarsEN, EL
Office: Limassol, Cyprus
Specialisation: company formation, corporate administration, trustee services
Company website: totalserve.eu
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestBusiness lawyers
Michael Kyprianou & Co LLCBusiness lawyersEN, EL
One of the largest law firms in Cyprus (Nicosia, Limassol, Paphos, Larnaca): immigration — residence and citizenship — plus property transactions and corporate matters for international clients.
Office: Nicosia, Cyprus
Specialisation: corporate and commercial law, company formation, immigration
Company website: kyprianou.com
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestLLPO Law FirmBusiness lawyersEN, EL
Law firm in Nicosia; its property and investment-immigration department is led by Georgia Lavithi (a Cyprus Bar member since 2013): residency by investment, citizenship, real-estate transactions.
Office: Nicosia, Cyprus
Specialisation: corporate, financial services and immigration law
Company website: llpolawfirm.com
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestConnor LegalBusiness lawyersEN, EL
Property lawyers acting for the buyer: title and encumbrance checks, contract and off-plan protection under Law 132(I)/2023, lodging the contract at the Land Registry, transfer of title. N. Connor LLC is a lawyers' company regulated by the Cyprus Bar Association (Reg. No. 1060).
Office: Nicosia, Cyprus
Specialisation: corporate and commercial law, incorporation, contracts
Company website: connorlegalllc.com
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a requestGlobalserve Consultants LtdBusiness lawyersEN, EL
Company in Limassol with its own legal department: immigration services (pink slip, permanent residence, work permits, citizenship) and tax support for residents.
Office: Limassol, Cyprus
Specialisation: company formation, tax and corporate services
Company website: gstaxconsultants.com
Licence not confirmed yetthe licence is not published in an open register — we will verify it with the company · register checked on 11.10.2026 · check the register
Send a request