How dividends are taxed in Cyprus - Evangelou Loizou & Associates Ltd

How dividends are taxed in Cyprusevangelouloizou2019-09-29T22:39:53+03:00

How dividends are taxed

Dividend income is only taxed with Special Contribution for Defense at the rate of 17%

The persons that are subject to Special Contribution for Defense are:

Cyprus tax resident companies, and
Individuals who are tax resident and domiciled in Cyprus

Therefore, if you are the owner of a Cyprus Limited Company and you are not a Cyprus Tax resident or you fall under the category of non-domiciled individuals* then you are not liable to any tax on the dividends you receive from your company.

You might be liable to tax on dividend income in your home country.

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1

What other options do you have
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The incorporation and structure of your investment defines the early stages of your business endeavor and impacts your future success.

How you set up your business depends on what sort of work you do. It can also affect the way you pay tax and subsequently the profitability of your business.

Consider if one of the following options is more suitable to you instead:
- a business partnership
- register a branch
2

Name your company
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A business name is the name under which your company operates. The company name must not be identical to any other.
The name of your company
Check if the name you want is available
3

Appoint directors and a company secretary
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You must appoint at least one Director and a company Secretary. The Director(s) are legally responsible for the management of the company.
Find out what directors are responsible for
Check who can be a director or company secretary
4

Decide who the shareholders are
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The Shareholders are the owners of the company. You need at least one shareholder who is also called a member and can be a physical person or a legal entity.

The Shareholders of your company
Find out how dividends from shares are taxed
5

Prepare documents agreeing how to run your company
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The objects of the business the Company will carry out, along with the regulations on how it will be managed, must be clearly defined in a document called the Memorandum and Articles of Association. This document must be prepared by a Cypriot Lawyer.
The memorandum and articles of association
6

Check what records you'll need to keep
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Check the company and accounting records you must keep
7

Register your company
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You'll need to register an official address for your company.
Specify the registered address of your company

Information and documents you need to provide us

You'll need to register with the Tax Authorities immediately after the registration of the Cyprus Company.
Registration with the Tax authorities and Social Insurance Services