Cyprus company formation
Starting a company in Cyprus can save you money on taxes. The corporate tax rate there is 12.5%, which is one of the lowest in Europe. Setting up a limited liability company in Cyprus takes from 2 to 6 weeks and costs from €1,151 to €5,000 depending on your case.
Top 5 company formation agents
If you’re short on time and just need a specialist, here’s our list of the top five Cyprus company formation agents. We picked them based on positive online reputation:
Types of companies in Cyprus
In Cyprus, entrepreneurs choose from several types of companies. This article focuses on the most popular option, the Private Limited Company (Ltd). Here is a full list of available company types:
| Company type | Description | Best for |
|---|---|---|
| Private Limited Company (Ltd) | Limited liability, most common | Small to medium businesses |
| Public Limited Company (PLC) | Can offer shares to public | Large businesses, stock exchange listing |
| Branch of Foreign Company | Extension of foreign business | Foreign companies entering Cyprus market |
| General Partnership | Shared responsibilities and liabilities | Small businesses with multiple owners |
| Limited Partnership | At least one partner with limited liability | Mix of limited/unlimited liability |
| Sole Proprietorship | Single owner, full control and liability | Individual entrepreneurs |
| Company Limited by Guarantee | Limited financial responsibility | Non-profits |
| Societas Europaea (SE) | Unified structure across Europe | Pan-European businesses |
Setting up a limited company by yourself
You can set up a limited company in Cyprus by yourself, but there are a few things to keep in mind:
- Only licensed lawyers can draft the Memorandum and Articles of Association.
- Many documents are in Greek, which can be challenging if you don’t speak the language.
- If you don’t live in Cyprus but want your company to be a tax resident there, you’ll need local directors and secretary of the company who live in Cyprus. This requires working with an agent.
Because of these challenges, entrepreneurs choose to work with an agent to make the process smoother and avoid mistakes. That’s why we’ll describe the company formation process including the participation of an agent.
How much time does it take to form a limited company
- : The fastest company formation takes about 2 weeks if you’re in Cyprus. If you’re doing this remotely, registration process can take up to 6 weeks because you would need to sign most documents by hand, which adds a few weeks for delivery via courier. Digital signatures can speed up the process, but they’re mostly available only to EU citizens.
Other factors that can slow down your company formation:
- Applying during holidays or peak periods when the registrar receives too many applications.
- Legal entity has a complex structure: multiple shareholders or directors, layered ownership, different share classes, or special governance rules.
- Documents that you need to prepare are hard to get in your country of residence.
- Translation of documents to English or Greek with apostillation if needed.
- Slow communication with your company formation agent.
- Slow communication with the bank.
Steps to register a company in Cyprus
- 1Find an agent: Contact a corporate agent to discuss your business needs, including services like nominee director, drafting agreements, and bank introductions.
- 2Negotiate terms: The agent provides a quote, timeline, and requests documents for the KYC process (proof of address, bank reference letter, CV, source of funds, etc.).
- 3Reserve company name (2-5 days): The agent reserves the company name with the Registrar of Companies.
- 4Draft incorporation documents (3-7 days): The agent prepares the necessary documents, including the memorandum, articles of association, and shareholder structure.
- 5Submit documents (5-10 days): The agent submits the documents to the Registrar of Companies and collects the incorporation certificates.
- 6Register with tax authorities: The agent registers the company with the tax department, obtaining a Tax Identification Number (TIN) and VAT number if applicable.
- 7Open a bank account (optional): The agent assists with bank account opening by providing the relevant documents and booking a meeting with the bank.
- 8Register with social insurance (optional): Required if the company plans to hire employees.
Must-have documents to prepare before engaging a company formation agent
Getting these documents ready in advance will save you time:
- Certified Proof of Identity: Get a copy of your passport or European ID card and have a notary, lawyer, or the Cyprus consulate certify that copy. Every company director and owner needs it.
- Proof of Address: Use a recent utility bill (electricity, water, or gas), a bank statement, or a certificate from your local police. Ensure it’s from the last 3-6 months and includes your name.
- Resume (CV): Highlight your background, education, and business experience.
- Bank Reference Letter: Ask your bank for a letter that confirms you’re a customer in good standing. Some agents might also accept a letter from your lawyer or accountant.
If some of your documents are in languages other than English or Greek, prepare to translate them. You may also need an apostille if the document is from outside of the EU.
Cyprus company costs & maintenance
The cost of setting up and maintaining a Cyprus company can vary significantly, sometimes by thousands or tens of thousands of euros.
If you want to keep costs low, the cheapest option may be to live in Cyprus and set up a simple LTD company where you are the sole owner, director, and secretary. You could even use your own apartment as the registered address to save more.
On the other hand, if you’re a digital nomad who wants to operate from Cyprus without living there, you might need to set up an LTD company and hire a local secretary and nominee director. This will cost a few thousand euros more, so you’ll need to decide if the potential tax benefits are worth the extra expense.
We checked the websites of company formation agents with clear pricing and computed the costs for each scenario. These numbers are just estimates and don’t cover everything, so actual costs may differ based on your needs:
Living in Cyprus and opening a local company in a cost-efficient way
- Company tax residency
- Cyprus
- Secretary
- Yourself if sole owner
- Director
- Yourself
- Registered address
- Your address
Pros
- Lowest cost to set up the company
- Cheaper local banking options
- No need to send documents internationally
- Fastest company formation
Cons
- Living in Cyprus or keeping tax residency might not suit everyone
- After living in Cyprus for many years, you could start paying a 17% SDC tax on dividends
- You’ll need to handle all the paperwork if you're the secretary
Base expenses
- Company formation
- Annual levy and other government fees
- Accounting fees
- Annual audit fees
Setup cost estimates including 19% VAT
- €1,151 - Fidelity Corporate Services
- €1,210 - Buy Now Companies
- €1,653 - YouReg
- €1,737 - Meridian Trust
- €1,964 - Profel
Living abroad and opening a non-resident company in Cyprus
- Company tax residency
- Other country where you live
- Secretary
- Agent
- Director
- Yourself
- Registered address
- Agent’s office
Pros
- Could be cheaper than setting up a resident company
- May benefit from Cyprus's favorable laws compared to other countries
Cons
- Local banking might not be accessible
- Bank account opening could be not easy depending on your location and passport
- Your home country may tax your Cyprus company
- Additional costs for tax consulting
Base expenses
- Company formation
- Annual levy and other government fees
- Secretary and registered office address fees
- Accounting fees
- Annual audit fees
Setup cost estimates including 19% VAT
- €1,151 - Fidelity Corporate Services
- €1,570 - Buy Now Companies
- €2,190 - Meridian Trust
- €2,440 - Profel
- €2,795 - YouReg
Living abroad and opening a resident company in Cyprus
- Company tax residency
- Cyprus
- Secretary
- Agent
- Director
- Agent
- Registered address
- Agent’s office
Pros
- Flexibility in where you choose to live
- Agent handles most compliance and paperwork
- Access to local banking
Cons
- Higher setup and maintenance costs
- Higher fees for local banking
- Your home country may tax your Cyprus company, but this can be legally avoided
- Additional costs for a nominee director to sign contracts
- Extra expenses for tax consulting in your country
Base expenses
- Company formation
- Annual levy and other government fees
- Secretary and registered office fees
- Nominee director fees, including charges for signing contracts or acting as a bank account signatory
- Accounting fees
- Annual audit fees
Setup cost estimates including 19% VAT
Includes introduction to local bank and registration for VAT:
- €2,698 - Fidelity Corporate Services
- €4,355 - Meridian Trust
Other options:
- €2,110 - Buy Now Companies (excludes VAT registration and introduction to a local bank)
- €3,273 - Profel (excludes VAT registration)
- €4,698 - YouReg (excludes VAT registration; includes introduction to a UK fintech for a business account instead of a local bank)
If you're a company formation agent and would like to add or update the pricing of your offer, send us a message using our contact form.
Cost breakdown
We’ve reviewed the websites of the agents and found the following costs:
Setup costs
Company formation package
You can negotiate the fee with your agent, covering essential tasks like filing forms, drafting the memorandum and articles of association, and registering with the tax department. If VAT registration is needed, it’s usually included. Confirm what’s covered and what’s not to avoid surprises.
Share capital
You’ll need to plan for the initial investment known as share capital. While not a direct cost, it’s needed for starting your business. Starting with around €1,000 shows financial stability. Delaying this deposit can cause issues with audits and banking.
Registrar name approval fee
Registrar of companies charges €50 to reserve a name for your company. Company formation packages usually include that fee.
Registrar LTD company formation fee
Government charges €105 when the agent submits documents to start the company formation process. Company formation packages usually include that fee.
Optional setup costs
VAT registration
VAT registration is required if your company’s annual turnover exceeds €15,600. If you choose to register voluntarily or if required, agents may charge a fee for this service.
Registrar express incorporation fee
If you need faster processing, you can pay a government fee of €100-€150 to reduce the time from two weeks to 1-2 business days. Some company formation packages already include this fee.
Corporate seal
Agents charge €20-€50 for a corporate seal, required for legal documents in Cyprus. Though not always mandatory, it’s needed for formal documents like contracts and resolutions. Banks and notaries ask for it. Company formation packages usually include that fee.
Certified copies of incorporation documents
If you need certified copies of incorporation documents, such as the certificate of incorporation, the government charges €50-€100 per document. Company formation packages usually include that fee.
Apostille legalization of certificates
Agents can help legalize documents by Apostille, needed if you plan to use the company’s documents outside of Cyprus.
Bank introduction
Agents charge a fee to assist in opening a business account in Cyprus, including help with filling the forms and answering bankers’ questions.
Annual maintenance costs
Registered office address
Your company in Cyprus needs a registered office address where you receive official documents. Agents usually include this service as part of their ongoing offerings.
Registrar annual company renewal fee, also known as annual levy
All Cyprus-registered companies pay a €350 annual fee by June 30th, even if dormant. If they don’t, the registrar can strike off the company and the state can claim its assets. The company recovers these assets when it pays the debt and restores its status.
Statutory financial audit
All companies in Cyprus undergo an annual financial audit, no matter their size. The cost starts at €1,000 and can go up depending on how many employees they have, their annual income, the number of transactions they process, the amount of invoices, and how complex their finances are, especially if they operate internationally or have multiple sources of income. As the result, auditor delivers reports and audited financial statements.
Accounting and bookkeeping
Government requires companies in Cyprus to keep accurate financial records and file annual returns on time. These tasks involve ongoing fees. If you hire a nominee director from your agent, they might insist on handling your company’s accounting because their director is responsible for whatever happens and they want to be on the safer side.
Secretary
The secretary organizes and updates the company’s documents, ensures the company follows all legal requirements and regulations, and acts as the point of contact with the registrar of companies. You can either provide a secretary yourself or arrange one through your agent.
Optional annual services
Nominee shareholder
A nominee shareholder holds shares on your behalf for privacy. This keeps your identity hidden from the public, but authorities will still know who the real owner is. Provided by agent.
Nominee director
A nominee director steps in to act on your behalf, keeping your privacy protected and making sure your company stays a tax resident in Cyprus. They handle important tasks like signing official papers, managing bank accounts, approving financial transactions, and ensuring your company follows local laws. Agents offer this service to help you meet legal requirements and keep your company running smoothly.
Bank account signatory
Agent’s fee for acting as a signatory of the business bank account. This is important when you’re living outside of Cyprus and trying to prove to your tax authority that there’s a professional director managing your company in Cyprus.
Annual bank introducer fee
Agent’s fee for helping you maintain relationships with the local bank in Cyprus and pass annual compliance checkups.
Taxes with rates and deadlines
Your agent or accountant will give you detailed tax advice for your situation. But here’s a quick overview of the taxes for limited liability companies in Cyprus:
Corporate income tax in Cyprus applies to the profits that companies earn. After subtracting costs like salaries, rent, and materials, companies pay 12.5% of the remaining profit as tax. The Cyprus government requires all companies to estimate their profit in advance and make two prepayments toward their corporate tax during the year. This advance payment model is called "Provisional Tax" and helps spread out the tax burden for entrepreneurs.
If a company in Cyprus estimates its profit after expenses to be €100,000, it pays 12.5% in two prepayments of €6,250 each as Provisional Tax during the year. If the actual profit matches the estimate at €100,000, the company doesn’t need to make any additional payments or request a refund. However, if the actual profit is higher or lower, the company either pays the difference or receives a refund when filing the final tax return.
Salary taxes include personal income tax and contributions to social insurance and healthcare. Employers in Cyprus pay 8.3% of each employee’s salary to social insurance and 2.9% to healthcare. Employees also contribute, with 8.3% going to social insurance and 2.65% to healthcare. If an employee is a tax resident of Cyprus, the employer also withholds personal income tax, starting at 20% for income over €19,500. Non-tax residents may not be subject to Cyprus personal income tax, depending on their situation.
If an employee earns €2,000 per month, the employer pays €166 to social insurance, €58 to health insurance, and withholds personal income tax based on the employee’s yearly income if the employee is a tax resident of Cyprus. The employee also pays €166 to social insurance and €53 to health insurance from their salary.
VAT (Value Added Tax) is a tax businesses in Cyprus add to the price of goods and services. The standard VAT rate is 19%. Businesses collect this tax from customers when they sell something and then pay the VAT to the government.
If a business makes more than €15,600 in sales each year, the government requires it to register for VAT. Smaller businesses don’t have to register unless they choose to.
If a company sells a product for €100, it adds €19 as VAT, making the total price €119. The company collects the €19 from the customer and later pays it to the government.
The Dividend Tax, also known as “Special Defense Contribution (SDC)” applies at 17% when companies distribute profits to shareholders who live in Cyprus and are domiciled there. “Domiciled" means the shareholder either has strong ties to Cyprus, like citizenship, or has lived in Cyprus for 17 out of the last 20 years. Non-domiciled shareholders don’t pay this tax.
When a company pays €1,000 in dividends to a domiciled shareholder, it deducts €170 as SDC and sends it to the government, leaving the shareholder with €830. If the shareholder is non-domiciled, the company pays them the full €1,000 because SDC doesn’t apply.
Here’s a list of the most common taxes that Cyprus companies are paying:
| Charged from | Tax | Rate | Payment frequency | Deadlines |
|---|---|---|---|---|
| Business net income | Corporate Income Tax | 12.5% on income after deducted expenses | Annual report, paid in two prepayments during the year | Submit reports every year before March 31 or July 31 if submitting electronically |
| Sales of goods and services | Value Added Tax (VAT) if registered | 19% standard or 5-9% reduced rate | Quarterly | VAT return submission 10th of the 2nd month after each quarter |
| Salaries to employees | Personal income tax | 0-35% withheld by employer | Monthly | Payment at end of the following month |
| Salaries to employees | Mandatory social insurance contributions | 8.3% by employer + 8.3% by employee | Monthly | Payment at end of the following month |
| Salaries to employees | Mandatory health insurance contributions | 2.9% by employer + 2.65% by employee | Monthly | Payment at end of the following month |
| Interest payments | Special Defense Contribution (SDC) | 30% withholding | Quarterly | Payment at end of the month following the quarter |
| Rental income | Special Defense Contribution (SDC) | 3% withholding | Quarterly | Payment at end of the month following the quarter |
| Dividends paid to domiciled shareholders | Special Defense Contribution (SDC) | 17% withholding | Quarterly | Payment at end of the month following the quarter |
| Dividends | No taxes on dividends aside from the Special Defense Contribution | - | - | - |
Sources:
IP Box regime — lower 2.5% tax rate for companies monetizing intellectual property developed in Cyprus
The IP Box regime in Cyprus offers a 2.5% tax rate on income from intellectual property developed in Cyprus, like patents and software. This special rate replaces the usual corporate tax for qualifying IP income, giving your business a tax advantage. Consult an agent to determine if your business qualifies.
How to choose an agent
The Cyprus government requires all agents offering administration services to follow strict rules, like keeping accurate records and complying with anti-money laundering laws. Agents who manage or run your company need an ASP (Administrative Service Provider) license, issued by one of three bodies: ICPAC, CySEC, or the Cyprus Bar Association.
While lawyers without an ASP license can help set up a company, they won’t be able to legally offer secretarial or nominee director services.
Agent types by their specialization:
Corporate agents: specializing in company formation and administration.
License registry: CySEC registry of ASPLaw firms: specializing in company formation and administration.
License registry: Cyprus Bar Association’s registry of ASPAccounting firms: specializing in accounting and audit.
License registry: ICPAC registry of ASP
Before selecting an agent for the role of a secretary or a nominee director, we suggest verifying their ASP license. Doing so offers you peace of mind by reducing the risk of being defrauded or paying penalties for mistakes in the annual compliance forms.
How to avoid unexpected costs and save time
Here’s our checklist of questions to ask your company formation agent:
Questions to ask your company formation agent in Cyprus
You might find some of this information on their website, but not all agents include everything you need to know. Use the points relevant to your case:
Due diligence
Service capabilities
Expected timeline
Breakdown of all costs
Potential lock-ins
After deciding to go with them
Find an agent to register your company in Cyprus
To help you save time we prepared a list of corporate agents, law firms and accounting firms who can help you set up a company in Cyprus in no time:
Frequently asked questions
- Can non-EU citizens open a Cyprus company?
- Yes, non-EU citizens can open a company in Cyprus. To qualify as a Cyprus tax resident, you may need a local or nominee director.
- Do I need to visit Cyprus to maintain my company?
- No, you don’t need to visit Cyprus if you hire a nominee director and a secretary. They handle meetings and decisions locally.
- What are the benefits of a Cyprus company?
- Key advantages include:
- Low corporate tax: 12.5%, among the lowest in the EU.
- No dividend withholding tax: Unlike Germany (up to 26.375%) and Italy (26%).
- Double tax treaties: Over 60 treaties, including with India and Poland.
- EU market access: Same as companies in Germany and France.
- English widely spoken: 76% of the population.
- Low costs: Annual costs (€3,000—€5,000) are lower than in Ireland or Luxembourg.
- Do I need to register for VAT when I form my company?
- Register for VAT if your turnover exceeds €15,600. You can register voluntarily if it’s lower.
- Can I manage my Cyprus company from another country?
- Yes, you can run your Cyprus company from abroad. To maintain Cyprus tax residency, ensure the company makes key decisions in Cyprus. Hiring a local nominee director can help with this.