Holding companies

Cyprus is an ideal place for holding company location.

The following factors are important when deciding the location of a holding company:

  1. Tax treatment of inward and outward dividends.
  2. Tax treatment of capital gains arising from sales of subsidiaries.
  3. Taxation of consolidated profit.
  4. Reputation of jurisdiction where the holding company was formed.
  5. Cost of incorporation and maintenance.
  6. Cost of audit of consolidated accounts.

Tax treatment of dividends

Dividends received from subsidiaries are exempt from profit tax.

Dividends paid to non-residents are exempt from withholding tax.

Tax treatment of capital gains

There is no tax liability when a holding company disposes shares in subsidiary or associated company.

Tax treatment of consolidated profit

There is no controlled foreign company rule. There is no income tax on consolidated profit in hands of a Cyprus holding company. This simply means that a profit centre could be in Singapore or Hong Kong (both jurisdictions are applying territorial taxation principle where non-Singapore or non-Hong Kong source income is not a subject to income tax in Singapore or Hong Kong), or even a “tax haven” like Belize where all profit is earned but consolidated in the hand of Cyprus company and show in consolidated profit a loss account and balance sheet without incurring any tax liability in Cyprus.

Reputation of jurisdiction

Cyprus officially joined the European Union from the 1st of May, 2004.

Cost of incorporation and maintenance

Cost of incorporation is relatively low. Registration of a Cyprus holding company is only €1,500, including registered office, Secretary, incorporation set including apostille and all registration fees. Nominee service is available at additional cost.

Annual audit cost

Annual audit cost of a Cyprus holding company is 25%-30% lower than in continental Europe.

Take the next step, we are here to help.

Register a Cyprus company.
Open a Cyprus bank account.

  Resources:

The UK Persons of Significant Control Register & its impact on companies

The UK Persons of Significant Control Register & its impact on companies

The requirement to maintain a register of people with significant influence or control, more commonly known as the PSC register was introduced to mandate all unlisted companies in the UK, including LLPs and dormant companies to maintain a register identifying those with significant control over a company.

Cyprus implements the Hague Convention, legally recognising Trusts as a type of Equitable Law

Cyprus implements the Hague Convention, legally recognising Trusts as a type of Equitable Law

This year, the Republic of Cyprus ratified The Hague Conventions’ definition of the legislation applicable to trusts and furthering the regulations surrounding their recognition. Cyprus common law now recognises trusts as a unique legal institution under equity.

SINGAPORE: the regulation of digital currencies & whats to come

SINGAPORE: the regulation of digital currencies & whats to come

The Monetary Authority of Singapore has released its plans to further control and regulate the current elusive virtual currency market and intermediaries that facilitate their online trade in Singapore. The anonymity surrounding so-called crypto currencies such as bitcoin raises questions over potential money laundering & terrorist financing risks.

How to incorporate a company in Cyprus with the required documentation

How to incorporate a company in Cyprus with the required documentation

Cyprus is the perfect location for incorporating an offshore or private company due to its simple incorporation procedures and agreeable tax structure. Below are the steps to company formation, the registration procedure, and all documentation required for incorporation:

ACRA release new initiatives for Singapore Filing Agents

ACRA release new initiatives for Singapore Filing Agents

ACRA have released new guidelines introduced to update the current system, bringing it transparently in line with other jurisdictions; going forward, businesses will be offered a copy of their business profile and the amount of information available for public use will increase substantially.

The servicing of documents to a Cyprus company & failure to act

The servicing of documents to a Cyprus company & failure to act

A Creditor may apply to court for the issuance of a liquidation order against a company that does not comply with a demand notice to pay any outstanding debts. The notice of demand is served to the registered office of the company, who then has 21 days to pay the fine; failure to do so may result in the liquidation of the company deemed unable to pay its debts by the creditor who can apply to legally dissolve the company.

Gibraltar companies now have to disclose full Beneficial Ownership details to Central Register

Gibraltar companies now have to disclose full Beneficial Ownership details to Central Register

Gibraltar is working to implement all EU legislation relating to the 4th Anti Money Laundering Directive into national law, in addition to the current EU legislation on financial supervision and direct taxation, and to this affect, the Government of Gibraltar have established a Central Register of Beneficial Ownership that will be effective from June 26th 2017.

European Commission publishes tax avoidance disclosure directive

European Commission publishes tax avoidance disclosure directive

The EC (European Commission) has published its draft legislation compelling financial service providers or intermediaries to disclose any international tax planning schemes they have encouraged, enabled or assisted in any way.