FAQ - Companies
1. Do I need to be in Cyprus to establish a limited company?
No, you need not be. All necessary applications forms for registering a company at the Registrar of Companies and memorandum and articles of association can be prepared and signed without the need for the founding parties to be present. Trusted lawyers or other persons of your choice can act as nominees for you, where desired and required.
2. Who can help me incorporate a Cyprus company?
A lawyer. By law the incorporation form is required to be sworn before a Court Registrar of the Cyprus Courts by a registered advocate. In Cyprus there is no distinction between solicitor and barrister or attorney and advocate. A registered advocate is any lawyer or LLC (a law firm) registered with the Cyprus Bar Association. It is also prudent to obtain legal advice from an experienced and independent lawyer with regards to any other requirements arising from the specific nature of business of the company you intend to incorporate.
3. In which language will the corporate documents be issued by the issuing government body?
A full set will be issued in the Greek language. An English set of the corporate documents will be issued if applied for.
4. Is there a minimum share capital required for incorporating a private company in Cyprus?
No. In practice most private companies are incorporated with a share capital of €1,000.00 divided into 1000 ordinary shares. An increase of share capital can take place at anytime thereafter. For financial or other corporate reasons, the members may wish to incorporate the company with a higher share capital from the outset.
5. Does the director or secretary have to be resident in Cyprus?
No, neither the director nor the secretary has to be a Cyprus resident. If you wish for the company to be a Cyprus tax resident then its management and control has to take place in Cyprus. A factor taken into consideration is the place of residence of the majority of its directors. As for the secretary, it is practical for the secretary to be resident in Cyprus so that the relevant notice forms of the Registrar of Companies are completed, signed and submitted by the secretary, who can also receive notices addressed to the company at the company’s registered office address, which has to be in Cyprus. Secretarial services, including the provision of a registered office address, are provided, by most, if not all, service providers.
6. What is the corporate tax rate?
12.5%. The effective tax rate may be reduced if the various incentives or deductions are utilised correctly.
7. How long does it take to incorporate a Cyprus company?
5-7 working days following the submission of the documentation for incorporation. A prerequisite is the approval of the desired company name. Approval of the name usually takes place in 3 working days.
8. What are the maintenance costs of a Cyprus company?
The maintenance costs can be as low as €350.00 per annum, being the annual company levy payable to the Registrar of Companies. Maintenance costs increase depending on the activities and/or turnover of each company.
9. Are there any specific conditions applicable to Cyprus companies for the opening of a bank account in Cyprus or abroad?
No specific banking or other regulatory conditions apply. Any Cyprus company is free to open a bank account subject to agreement with the relevant bank or financial institution, which will apply its KYC due diligence procedure and policies.
10. Can a Cyprus company own real estate?
Yes, it can. Cyprus ownership rules and conveyancing procedures apply to both natural and legal persons. A Cyprus company can enter into a contract of sale or assignment agreement as a purchaser or as a vendor as the case may be. The title deed of the real estate owned is registered in the company’s name directly and not in the name of its members or directors.
11. Can a Cyprus company be the owner of assets abroad?
From a Cyprus legal perspective, it can, subject to any requirements imposed by the applicable jurisdiction where the asset is located. It is advisable for the Cyprus company (or its officers) intending on purchasing real estate or other assets abroad to obtain impartial legal advice also from a lawyer in the country where the real estate or other asset is located.
12. To what extent are the shareholders or beneficial owners of a Cyprus private company limited by shares liable for the company’s debts (if any)?
The liability of the shareholders (registered and beneficial) is limited to the respective shareholder’s participation in the company, meaning the shareholder’s capital contribution to the company. The private company limited by shares is a separate legal entity and its shareholders are not held personally liable for the debts of the company.