Planning to Build a Business Empire in Cyprus? Here’s What You Should Know
Cyprus has always been an ideal spot for businesses. The location and workforce it offers are rivalled only by a few other countries.
The country has one of the lowest costs for setup and operations in Europe. Consequently, many companies and banking units have set their companies there, furthering the economy’s growth.
Any business wishing to succeed in the Cypriot environment will need assistance on handling obstacles like the Cyprus company registration process and taxes. According to the World Bank and IFC, Cyprus holds a low rank in terms of “Doing Business”. This makes scoping out the business environment even more important.
Here are a few points one should consider before starting any company in Cyprus:
1. Business Protocols
One must have clearance from the Registrar of Companies before starting any firm. Afterwards, one should prepare a memorandum and articles of association before proceeding to the final tax processes. The departments to go to are the following: Ministry of Labor (social security), Ministry of Commerce (tax) and, Ministry of Finance (VAT).
2. Construction Permits
In Cyprus, it can be costly to acquire construction permits. The duration of acquiring a construction permit is 677 days on average. Though the process only contains 9 procedures, one is frequently slowed down due to obstructions such as town planning.
The Electric Authority of Cyprus carries out all electrical operations in the island. They create the necessary electrical connections and procedures, frequently with the duration of 247 days.
4. Property Registration
One must first take into account the legalities, preferably with a lawyer, before registering one’s company through the Department of Lands and Surveys. Once taxes have been settled, a declaration of transfer can be made in Land Registry. Fortunately, Cyprus is fairly easy in terms of property registration.
5. Tax Payment
Cyprus businesses are required to pay 28 major taxes annually, which take up a considerable amount of time. Although the tax rate is significantly lower as compared to other European nations, the processing time is quite long.
6. Trading Outside
The Cypriot economy has lowered the trading cost, even with traders outside their borders. However, there are seven documents to be filed when shipping imports or exports.
Values like trust and hospitality are greatly cherished in Cyprus. Frequently, the businessmen in Cyprus deal internationally, so creating respectful and trusting relationships between businessmen is prioritized.
8. Contracts and Debt
For a contract to be enforced in Cyprus, one has to manoeuvre 43 procedures and wait over 2 years. Additionally, resolving one’s debt requires 1.5-year duration.
Getting credit from Cyprus has become more difficult due to the restrictions caused by European Union bailouts. Unfortunately, this has resulted in an obstructed flow of capital.
10. Protection of Investors
The IFC and World Bank cite Cyprus as one of the top countries that protects investors. Cyprus has frequently fared well in terms of the disclosure index and shareholding.
Overall, Cyprus contains a climate suitable for businesses to prosper. But one has to keep in mind factors such as taxes and registration. Also, it can never hurt to review the annual company fees to be fulfilled.