Registration of Cyprus International
(offshore) Company

 

Definition

In simple terms, a Cyprus International Business (offshore) Company (IBC) is a normal limited liability company which is used as a tool, legally, by corporations and individuals throughout the world to direct profits out of high tax countries into offshore jurisdictions or international financial centers thus taking advantage of low or zero tax and double tax treaties. The beneficial ownership and business activities of the Cyprus International Business (offshore) Company lie outside Cyprus.

 

Tax Advantages

A Cyprus IBC enjoys substantial tax incentives:

-Flat rate of 12.5% tax on net profits
-Zero tax if management and control is outside Cyprus
-No withholding tax on payment of dividends, interest and royalties
-Dividend income received is wholly exempt from Cyprus tax
-Profits from sale of shares and other securities wholly exempt from Cyprus tax
-Interest received wholly exempt from Cyprus tax (unless it arises from the ordinary course of business)
-No capital gains tax on sale of immovable property situated overseas
– No exchange control restrictions
-Wide network of Double Tax Treaties to avoid double taxation

 

Registration Procedure

GCP Auditors can assist you in registering an IBC efficiently, timely and at low costs. Normally it will take approximately five working days to register an IBC.

The following information is normally required in order to register an IBC:

-Proposed name of company
-Brief description of main activities
-Amount of initial share capital (normally €1.000)
-Beneficial shareholders (names, nationality, occupation, passport no., residential address, number of shares to be
subscribed)
-Directors (names, nationality, occupation, passport no., residential address)
-Registered office address (must be in Cyprus)
-Company Secretary (name, nationality, passport no., residential address

Note: For each shareholder and director a copy of his passport together with a utility bill as proof of his residential address must be forwarded to us together with the above information.

Where confidentiality is important, ​GCP Auditors can assist clients in providing fiduciary services such as nominee directors, nominee shareholders, company secretary and registered office for a small annual fee. Furthermore, it is important for tax purposes to establish that management and control of the company is exercised from Cyprus by using local resident directors. The local directors will act always upon receiving authorization and instructions from the beneficial owners. A series of documents such as trust deeds, undated blank instrument of transfer of shares and undated letters of resignation by the local nominee directors and nominee shareholders are drawn up and are in place in order to safeguard the interests of the beneficial owners.

 

Administration

Upon registration of the Cyprus International Business Company, the following legal documents are issued by the Registrar of Companies:

• Memorandum and Articles of Association
• Certificate of Incorporation
• Certificate of Registered Office
• Certificate of Directors
• Certificate of Shareholders

 

GCP Auditors can also assist clients, once the IBC is registered, in such necessary initial administrative matters as:

• Opening of corporate bank accounts in Cyprus and worldwide
• Vat Registration
• Tax Registration
• Ministry of Labour and Social Insurance registration

 

​GCP Auditors can, furthermore, undertake to perform the daily routine activities of the IBC, which may include:

• Monitoring of corporate bank accounts
• Processing bank transfers
• Invoicing
• Bookkeeping and administration support
• Preparation and filing of VAT returns
• Payroll preparation
• Preparation of management accounts and reports

 

Annual Requirements by Law

A Cyprus International Business Company is legally required to prepare and file, on an annual basis, normally at 31st December each year, the following statements and returns:

• Audited Financial Statements. The audit must be carried out by an auditor authorized under Cyprus Law;
• Annual Tax Returns. The Returns have to be completed and certified by an authorized certified public accountant under the Cyprus Law, and then submitted to the Commissioner of Income Tax for approval;
• Company Annual Return which has to be submitted to the Registrar of Companies together with the Audited Financial Statements, translated in Greek.

GCP Auditors and its business partners, associates and alliances can assist clients to ensure compliance with all of the above statutory and regulatory requirements.