A holding company in Cyprus is a regular company that does not produce goods or services but owns the outstanding shares of stock of other companies. Business owners can thus separate their interests and use separate legal entities to structure their business holdings. Holding companies in Cyprus enjoy a favorable tax regime and the country remains a valuable location for international companies and foreign investors.
Our Cypriot company formation experts are ready to give you any information about international tax planning and tax management in Cyprus.
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Cyprus is a good location for holding companies
Cyprus is an international business and financial center. Companies benefit from a large number of double tax treaties and they also enjoy a transparent legal system. However, the most important benefit of Cypriot companies is anadvantageous tax regime.
Investors choose Cyprus because it offers tax advantages and an efficient repatriation of profits. Also, the country is a hub between Europe, Asia and the Far East. More and more investors are choosing Cyprus as a holding company location, but also to establish other types of companies that operate in various business fields.
The advantages of a Cypriot holding company presented by our Cyprus company formation agents
Holding companies in Cyprus benefit from the provisions of the EU Parent-Subsidiary directive and the Interest and Royalties Directive, meaning that there is no withholding tax for these companies. Dividends received by a Cypriot holding company are generally exempted from the corporate income tax and in most cases are also exempt from the special defense contribution. Our company formation representatives in Cyprus can give you more details about the situations in which these exemptions apply for dividends.
Holding companies in Cyprus benefit from no withholding taxes on the distribution of profits and no capital gains or income tax is applicable upon the liquidation of the participations or the liquidation of the company itself. Company mergers, takeovers and re-organizations are tax exempt.
The Cypriot holding company must not register for VAT if the main business activity is the acquisition and holding of shares in other companies and the holding company does not take part, directly or indirectly, in the management or administration of its client companies.
European residents who have holding companies outside the EU can benefit if they choose Cyprus as the location for their holding company. If you want to register a company, please contact our company formation agents in Cyprus. We ca help you with various company incorporation matters.