There are many factors that we should look for before establishing a company in any of the countries in the world. Better tax planning is one of those factors and it affects the companies to a greater extent. When it comes to better tax planning, Cyprus is one of those countries where thousands of businessmen invest their money because of this better tax planning. Therefore, Cyprus Company Formation has become a popular topic on the Internet. Cyprus offers favorable incentives which motivate businessmen around the world to start their companies in Cyprus. Because of all these factors, Cyprus has become the ultimate business centre of the world.
Previously in the past there were two types of companies registered in Cyprus as offshore and local companies and different benefits were given to these two types of companies. But now there is no longer any differentiation in Cyprus company formation among what were known as offshore and local companies registered in Cyprus in the past. Offshore or overseas companies registered in Cyprus accustomed to enjoy a lowered level of business tax at the rate of 4.25%. This is no more the case and the primary rate for corporation tax is now at 12%. Even at 12.5%, this is currently the best rate in Europe, with other tax bonuses in force to be able to bring in foreign investment.
When it comes to forming or establishing a company in Cyprus, there are several steps that you should follow to start it legally. Following are those steps that you have to pass through.
1. Reserve the Company name and get initial approval from the Registrar of companies
A conventional form application for authorization of name is submitted personally or by mail to the One Stop Shop Cyprus. It can also be submitted in electronic format to the Registrar of Companies and Official Receiver, via the E-filing website. This will charge EUR 30- which is EUR 10 mandatory and extra EUR 20 for expediting the procedure, which is optional.
2. Prepare the Memorandum and Article of association by a Lawyer
The Registrar of Companies does not have any standard form for the Memorandum and Articles of association. The Companies Law offers a general template appropriate for any kind of activities. It is a statutory necessity to have lawyers prepare the Memorandum and Articles of Association, who should also sign the specific declaration. This will take about a day to complete and it will cost about 1000 Euros.
3. Submit documents at the Companies Section of the Department of Registrar of Companies and Official Receiver
This will take around two days and it will cost EUR 205 registration fees + 0.6% on the authorized capital + EUR 220 for the certificates.
4. Register at the Tax Department for tax
5. Register at the Tax Department for VAT
6. Register for Social Contribution at the Ministry of Labor, Welfare and Social Insurance
After following these steps you can start your own company in Cyprus and enjoy the benefits given by them. If you already have a company, you have the chance to develop your company further by starting a branch in Cyprus. It is obvious that you can establish a successful business company in this favorable business environment in Cyprus.