Roadmap for setting up & Operating in Cyprus

Updated: Sep 20

Cyprus is a highly attractive jurisdiction to set business and create substantial presence.

CYPRUS - WORKING RESIDENCE PERMIT

In general, as in most countries, Cyprus issues residence and employment permits on a temporary basis and for specified work. Foreign nationals (non-Eu citizens) can apply and be granted a general employment work permit for a duration of 4 years with the ability to renew if the Civil Registry is satisfied that such position could have not been filled by a Cypriot or an EU citizen. However, the Republic of Cyprus as an initiative to encourage international businesses to set up their headquarters provides for special residence and work permits for non-EU staff of “Companies with Foreign Interest” that have no restrictions in regards to the duration of permits.

What are Companies with Foreign Interest?

· Companies duly incorporated in the Republic of Cyprus

· Majority of the companies’ shareholders is non-EU nationals (over 50%) or

· If the percentage of the foreign participation in the share capital of a company is equal or below fifty percent (50%) of the total share capital, this percentage should represent an amount equal or higher than €171.000.

An eligible company which fulfills the above conditions should apply to the Ministry of Interior, Civil Registration and Migration Department to be registered as a Company of Foreign Interest. The following documents at a minimum will be requested:

1. Original Certificate of Incorporation by the Registrar of Companies.

2. Original Certificate of Registered Office by the Registrar of Companies.

3. Original Certificate of Directors by the Registrar of Companies.


Original Certificate of Shareholders by the Registrar of Companies, proving that the percentage of foreign participation in the company's share capital is over 50% of the total share capital*. In the case where companies are the shareholders, the whole chain of ownership up to the final owners (natural persons who are the ultimate beneficial owners) should be declared and documented.* In case where the percentage of foreign participation in the company's share capital is equal to or less than 50% of the total share capital, in order for the company to be considered as suitable, the foreign participation should represent an amount equal to or greater than the amount of €171.000.

4. Directors’ Affidavit on the company's ownership

5. Ultimate Beneficial Owners’ valid passport(s).

6. Original Company Memorandum.

7. Description of the company’s principal activities.

8. Deposited amount of at least €170.860, supported by a Bank SWIFT or other similar document which proves a foreign direct investment by the ultimate beneficial owner, legally admitted to Cyprus from abroad. In the case where the investment has not directly been made by the ultimate beneficial owner, the relation of the investor to the ultimate beneficial owner must be proved and documented.

·9. Recent bank account statement with a remaining balance of at least €41.006 at any moment (from the initial investment of €170.860).

10. Completed Analytical Statement of Company of Foreign Interests’ Personnel

11. Title of ownership or rent agreement. If the title of ownership has not been obtained yet, the applicant must submit the contract of sale duly stamped by the Stamps Commissioner and the Department of Lands & Surveys and proof of payments.

12. Audited Company Accounts (for companies already operating in Cyprus).

13. Tax Clearance Certificate for the company (for companies already operating in Cyprus).

14. Proof of Levy Payment for the Registrar of Companies (for companies already operating in Cyprus).

Foreign Nationals Staff

Approved companies by the Civil Registration and Migration Department may employ third country nationals in the following positions:

a) Executive Directors

b) Middle Management Staff/Executive Staff/Other Key Support Staff

c) Other Support Staff


a) Executive Directors

Includes employees who are:

i. Consulting Directors

ii. General Managers of branches and subsidiaries of foreign companies

iii. Departmental Managers

The maximum number of Executive Directors that can be employed is generally 5, unless the company can justify otherwise. Newly appointed Executive Directors must be paid a minimum €3.872, an amount that may be adjusted from time to time, depending on fluctuations in the wage index.

b) Middle Management Staff/Executive Staff/Other Key Support Staff

Includes employees who are:

i. Upper/Middle management personnel

ii. Other administrative, secretarial or technical staff

The maximum number of staff allowed to be employed under this category is 10, unless the company can justify otherwise. Newly appointed employs in this category must be paid within the range of €1936- €3871 an amount that may be adjusted from time to time, depending on fluctuations in the wage index.

c) Supporting Staff

This category includes all third country nationals not included in the aforementioned categories. In this case the Department of Labour expects that positions in this category should be filled by Cypriot or other EU citizens. In instances where no qualified Cypriot or other EU citizen cannot fill such positions then the company may elect to employ third country nationals by first securing positive recommendation of the Department of Labour

An eligible individual which fulfills the above conditions should apply to the Ministry of Interior, Civil Registration and Migration Department for an entry permit, registration and acquisition of a temporary residence and employment permit for employees in companies of foreign interest. The following documents at a minimum will be requested:

1. Copy of valid passport or other travel document with validity of at least two (2) years from the date of the submission of the application.

2. Copy of the passport's or other travel document's page showing the latest arrival in the Republic and visa (if applicable)

3. List of Company´s third country personnel per category [Directors and Middle Management Staff /Key Personnel] (instances which this is not required)

4. Brief Curriculum Vitae (CV) (including copies of academic qualifications) + Diplomas

5. Original letter of guarantee issued by a bank or cooperative institution in Cyprus with validity of 10 years covering possible repatriation expenses. The amount depends on the country of origin. (instances which this is not required)

6. Original blood analysis results showing that the third country national does not bear/suffer from HIV, syphilis, hepatitis B and C and a chest x-rays for tuberculosis (TB) from a Government Hospital of the Republic or duly certified by a Government Doctor of the Republic

7. Original contract of employment dully signed and two (2) copies dully stamped

8. Title deed or rental agreement of a house/apartment dully certified by the relevant president of the community (mukhtar)

9. Valid Certificate of Health Insurance for medical care that covers inpatient and outpatient care and transportation of corpse (Plan A)

10. Employer´s liability insurance with an automatic renewal

11. Original Certificate of Criminal Record from the country of origin (if the applicant resides in a country other than the country of origin, the certificate should be issued from the country of residence)

12. Receipt of payment of the annual company fee to the Registrar of Companies (instances which this is not required)

13. Authorisation for payment by bank transfer (FIMAS) (instances which this is not required)

Payroll – Employer’s and Employee’s Liabilities:

Each employer needs to cover the following expenses based on each employee’s remuneration on top of the monthly gross salary of the employee. The employee’s liabilities are automatically deducted from his gross salary by the employer.

Total percentage based on gross salary

14.90% Employer's Contribution

10.95% Employee's Contribution

Related Documents:

· APPLICATION FOR THE ACQUISITION OF AN ENTRY PERMIT, REGISTRATION AND THE ACQUISITION OF A TEMPORARY RESIDENCE AND EMPLOYMENT PERMIT FOR EMPLOYEES IN COMPANIES OF FOREIGN INTERESTS THE MAJORITY OF THE SHARES OF WHICH BELONG TO THIRD COUNTRY NATIONALS

· REGISTRATION AND FIRST TEMPORARY RESIDENCE PERMIT SUPPORTING DOCUMENTATION

· REGISTRATION OF NEW A COMPANY AT THE CRMD REGISTRY OF COMPANIES OF FOREIGN INTERESTS

· ANALYTICAL STATEMENT OF COMPANY OF FOREIGN INTERESTS PERSONNEL


Cyprus is a highly attractive jurisdiction to set business and create substantial presence.


Flexi Group is here to assist you in all steps of the way from forming your business to well establishing your presence in an EU member state.


With an all-inclusive service and through Flexi Group experience and expertise, we are able to provide you with costs & time efficient solutions that will care to your every need and guarantee your operational success in Cyprus .


STEP A : AT BUSINESS SET-UP STAGE

Planning

  • Assist in selecting the most appropriate corporate structure, depending on the business needs

  • Advise on the most suitable entity vehicle

  • Advise on the application of advantageous tax & legal regimes of the local legislation

  • Advise on financing options & cost forecast for the business operations

  • Support services for set-up requirements

  • Provision of fiduciary services

Forming and Registering the Company

  • Assist with the formation of an appropriate corporate entity / trust / fund

  • Assist with the opening of bank accounts with local banks

  • Registration & Ensure compliance of requirements for Tax, VAT etc.

  • Assistance and registration of entity with local authorities where necessary


Office premises and infrastructure

  • Finding the most appropriate business location, office space

  • Assist in drafting purchase/lease agreement for the office

  • Advice on issues regarding security, infrastructure, internal controls and statutory requirements including operational licenses.

People

  • Assist with interviewing suitable staff and local directors along with the remuneration structure

  • Assist in drafting employment contracts and registering the employees with local authorities

  • Assist with work permits for overseas staff and relocation of the family


STEP B : AT THE OPERATIONAL STAGE


Regulatory Compliance

  • Support & Management of bank accounts and banking issues in general

  • Ensure compliance with local authorities (TAX/VAT/REGISTRAR OF COMPANIES/ SOCIAL INSURANCE) & other reporting requirements

  • Assistance with filling requirements of local authorities

  • Fund administration services

  • Accounting services (outsource or co-source)

Advisory and Fiduciary

  • Asset & liquidity management services

  • Drafting of corporate documents (preparation of minutes, register books, share certificates) fully compliant with local legal requirements. Assistance in holding board meetings and annual general meetings

  • Drafting of legal documents and review of agreements. Provision of Power of Attorneys & other legal advise

  • Identification of new investment opportunities based on the business industry and needs.

Reporting

  • Accounting services & maintaining of proper accounting records

  • Preparation of financial statements (out-source) and/or management accounts in line with IFRS

  • Assistance & Advice on financial obligation and necessary reporting.

Human Resources and Personnel

  • Payroll services

  • Assistance of personnel with their taxable income requirements

  • Ensure compliance with GDPR regulations and advice on employment law issues

We are a team of experienced professionals, all sharing a unique drive for learning and development through teamwork. The Group utilizes its various core activities to implement customized solutions for its clients. Our collective experience spans the areas of Global Corporate & Fiduciary Services, Assurance & Advisory Services, Fund Administration, Tax Advisory, Corporate Governance, Financial Services, Private Wealth Services and Compliance.

Start a conversation with us today to find out how you can benefit from a relationship with Flexi Group.

Please get in contact with our Head of Business Development:

Mrs Daniella May / Head of Business Development

Tel.: + 357 7000 2 5555 / + 357 22 87 57 55

E: inquiries@flexi-group.net

We also organize calls using Skype. Our flexi Skype ID is web@flexi-group.net






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