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An overview and why Cyprus is a top choice

NOTE! CM Consulting Ltd. attaches particular importance to always providing consulting services under the aspect of economic efficiency and at the same time creating opportunities for self-refinancing via its own holding structure. We deliberately distance ourselves from the term “tax havens” and concentrate instead on offering sustainable and legally compliant solutions that ensure long-term economic success and meet business requirements.
Tax havens – this word often conjures up images of luxurious beaches, impressive villas and tax advantages. But what is behind this term? In this blog post, we provide an overview of tax havens in general and the difference in legal advantages that Cyprus offers.

What is a tax haven?

Tax havens are countries or territories that offer particularly favorable tax conditions for foreign companies and private individuals. These advantages can take the form of virtual locations, “letterbox companies”, low tax rates, generous tax exemptions or simplified regulatory requirements.

Well-known tax havens include:

  • Bermuda: No corporate taxes, income taxes or capital gains taxes.
  • Cayman Islands: Zero taxes on income, capital gains and corporate profits.
  • Luxembourg: Attractive tax framework for companies and funds.

Why do companies and private individuals use tax havens?

The advantages of tax havens are obvious. Companies can significantly reduce their tax burden, which leads to higher profits. Private individuals also benefit from lower or no taxes on income and assets. In addition, many of these countries offer a high degree of confidentiality and discretion.

Cyprus is therefore not a tax haven!!!, but offers special advantages….., this completely legal and without a “certain flavor”.

Among the many attractive locations worldwide, Cyprus stands out in particular. But what makes Cyprus so attractive?

  1. Low corporate taxes Cyprus offers one of the lowest corporate tax rates in Europe at just 12.5%. This makes it particularly attractive for companies that want to minimize their tax burden.
  2. No withholding tax on dividends Cyprus does not levy withholding tax on dividends, which makes it an ideal location for holding companies. Companies can distribute dividends without being subject to additional taxes.
  3. Double taxation agreements Cyprus has a wide range of double taxation agreements with over 60 countries. This significantly reduces the tax burden for companies and private individuals and prevents double taxation on international income.
  4. High standard of living and strategic location In addition to the tax advantages, Cyprus offers a high standard of living with a pleasant climate, beautiful beaches and a safe environment. Its strategic location between Europe, Asia and Africa also makes it an attractive hub for international business.
  5. Simple and fast incorporation process Incorporating a company in Cyprus is relatively simple. With the support of experts, companies can be founded quickly.
  6. Favorable office The establishment of a permanent establishment in Cyprus is subject to the local regulations of Cyprus on the one hand and the global EU regulations on the other, which govern a legal business location. A company that generates turnover outside Cyprus is obliged to establish a real permanent establishment. A virtual company address “letterbox company” is not sufficient.
  7. Attractive regulations for expatriates Cyprus offers attractive tax regulations for expatriates, including a 50% tax rebate on income over 100,000 euros for highly qualified employees.

Conclusion

Tax havens offer numerous advantages for companies and private individuals who want to optimize their tax burden, but this sometimes leads to legally uncertain constructs and causes problems when capital flows to Germany at the latest.

This problem no longer exists in Cyprus, with its particularly favorable tax conditions and attractive standard of living, as Cyprus belongs to the EU and is therefore subject to the legal framework of EU economic regulations.

The combination of an EU economic region, low taxes, a strategic location and a high standard of living makes Cyprus one of the best locations for businesses and individuals alike.

WebMasterWolf

WebMasterWolf