Cyprus: The unknown ‘tax haven’
Despite being located in the European continent and being a full member of the European Union, Cyprus remains a tax residence unknown to many.
This lack of recognition can be attributed to a combination of factors that have kept the island of Cyprus with a relatively low profile:
- Its unremarkable location in the depths of the Mediterranean Sea.
- Its small dimensions.
- Its former reputation as a “tax haven” in the eyes of many countries (and the stigma associated with it).
However, Britons and Russians have long been aware of and benefited from the country’s tax advantages.
These advantages, along with its temperate climate and beautiful beaches reminiscent of the Caribbean, have accelerated the arrival of entrepreneurs and large corporations, as well as an increase in real estate investment.
Is Cyprus still a tax haven?
Since 2014 Cyprus ceased to be considered a tax haven.
However, the country maintains highly advantageous tax conditions (some of them unmatched in the European Union).
How many taxes are paid in Cyprus?
The most frequent question when we mention that the founders of Tax Nomads have chosen Cyprus as our ideal destination for Tax Nomadism is: How many taxes are paid in Cyprus?
The explanation is simple:
Cyprus’ general tax regime, although considerably better than that of countries like Spain or Germany (considered true tax hells), is not among the best worldwide.
However, its tax regime for non-domiciled individuals (Non-Dom) is extremely beneficial.
In this article, we won’t delve deeply into Cyprus’ tax regime, but in general terms, the Non-Dom regime applies as long as you haven’t resided in Cyprus for 17 out of the last 20 years.
And how long does the Non-Dom status last? 17 years!
Since you move your tax residency to Cyprus and acquire Non-Dom status, you will enjoy 17 years of special tax treatment that, combined with the general regime, translates to:
- 2.65% on all dividends received (up to €180,000, then 0%).
- 0% income tax on salary within the first bracket (up to €19,500).
- 0% tax on gains from investments in stocks, ETFs, bonds, cryptocurrencies, etc.
- Corporate Tax of only 12.5%.
- Tax residency in Cyprus with a minimum stay of only 2 months per year in the country.
- Favorable regime for patents or IP BOX with a 2.5% corporate tax.
- Additionally, you receive the same social public benefits as in countries like Spain (healthcare, European Health Insurance Card, retirement, unemployment, education, etc.).
It’s clear that Cyprus is becoming the new trendy destination within the European Union for Fiscal Nomads.
That’s why there are already large communities of entrepreneurs of various nationalities in Cyprus.
And the best part is that we are confident these conditions will remain for many years, so the growth won’t stop!
Cyprus: our tax residency
For these reasons, we chose Cyprus:
Long-term
Cyprus’s 17-year Non-Dom regime has no rival in the European Union.
Versatility
Its tax benefits apply to virtually any business or economic activity imaginable, even for pensioners!
Additionally, requiring only 60 days of stay on the island allows for much greater travel freedom.
Climate
Little to add here. You’ll find a climate similar to the coastal areas of the Mediterranean in Spain.
Language
English is widely used in everyday life, making communication easy with both Cypriot citizens and foreigners arriving on the island.
Dimensions
It’s not a large country, but it has everything you need. For reference, the island is approximately the size of 30 Andorras.
Networking
Cyprus is becoming a hub for entrepreneurs and talent from around the world.
European Union
EU membership facilitates the relocation process in terms of migration, customs, and security.
