As mentioned in previous articles Cyprus can be a top destination in Europe to set-up your business. However, we do understand that it can be nerve-racking setting up in a foreign jurisdiction without knowing a lot about it.
In that respect we have compiled below a list of 15 questions and answers to help facilitate your understanding on Cyprus Companies.
Feel free to contact us for any further questions you may have.
1. What are the benefits of a Cyprus Company?
Either the EU Membership, the various Tax Benefits for Companies and Expats or the wonderful climate, Cyprus offers a lot of reasons to establish a Company at. Please refer here for more information.
2. What is the procedure to incorporate in Cyprus?
Please refer to the step by step guideline in our incorporations page for a detailed step plan on the Cyprus Company incorporations.
3. Do I need to come to Cyprus to incorporate my Company?
No, you can sign the Memorandum, Articles of Association and any other document which may be required in wet ink and send us the scanned copies for us to be able to proceed with the incorporation.
4. Does the Cyprus Company need to have a Bank Account before incorporation?
No, the bank account can be opened after the Cyprus Company is incorporated.
5. Can I have a bank account for my Cyprus Company outside of Cyprus?
Yes. You can have a bank account for the Cyprus Company with any bank. However, if the Cyprus Company will have offices and employees in Cyprus we recommend to have a Bank Account with a Cyprus Company.
6. How can I choose a name for my Cyprus Company?
The name of your entity should not be too general or already in used, otherwise the Registrar may not approved. We can provide a free consultation on the name, as this is the first step on the incorporation. You can read our relevant article here.
7. What is the Memorandum and Articles of Association?
Every Cyprus Company must have its own memorandum and articles of association.
The memorandum contains the basic information of the company such as the company name, registered office, the objects of the company and so on. Care must be taken that the first few object clauses are tailored to the specific circumstances and main business objects and activities of the company (we can assist with such).
The articles specify rules about the governance of the internal management of the company and regulations about the rights of the members (appointment and powers of directors, transfer of shares, etc).
8. What is a registered office?
Every Cyprus Company needs to have a registered office in the Republic upon incorporation.
The registered office is the place where writs, summonses, notices, orders and other official documents can be served upon the company. It is at the registered office where the company’s register of members is usually kept. This can be the premises of the entity, or such an address can be provided by us as outlined here.
9. What is a corporate secretary?
Every Cyprus Company needs to have a corporate secretary, which is responsible for the filings to the Registrar of Companies amongst others. Such services can be provided by us, as outlined here.
10. What is the minimum number of Directors and shareholders and who can be one?
The Cyprus Company shall have at least 1 Director and 1 shareholder upon incorporation. Quorum for Directors meetings will be set at the Memorandum and Articles of the Cyprus Company.
11. How can I achieve tax residency for my Cyprus Company?
As the legislation currently stands, management and control needs to be exercised out of Cyprus for the Company to be considered a Cyprus Tax Resident. This means that as a minimum the majority of the Directors need to be Cyprus Tax Residents, so that decisions are taken from Cyprus. However, the more substance you please in Cyprus (offices, employees etc), the more you strengthen the Company’s case for Tax Residency.
Asterisk offers professional, experienced Directors with limited number of Directorships to strengthen the Company’s case for Substance in Cyprus.
12. Does the Share Capital have to be paid at the Companies Registrar upon incorporation?
No, the share capital initially will be shown as receivable from shareholder, and can be settled when the Company has a bank account or when the shareholder pays any expenses on behalf of the entity.
13. What is the minimum share capital I can have on my Cyprus Company?
Usually we incorporate entities with authorized share capital of 5,000 ordinary shares of €1 each, and issue 1,000 ordinary shares of €1 each. After incorporation shares out of the authorized share capital of the Company can also be issued at a premium. The authorized share capital can also be increased at subsequent stages.
14. Does the share capital need to be in EUR?
No, usually we incorporate Cyprus Companies in €, however, this can also be in other currencies such as USD$, GBP£ etc.
15. What registrations I need to do after incorporation?
As a minimum upon incorporation the entity shall register with the Tax Authorities and obtain a Tax Identification Code (TIC), 60 days after incorporation.
There are other registrations that the entity may need such as VAT (if it will conduct vatable activities, or registration with the Social Insurance Authorities if the Company will have employees etc).
The above are provided for indicative purposes only and do not constitute any form of advise. You can contact us for more information and specialized advise on Cyprus Company Formation matters.