Modernization Of The Cypriot Tax System

Cyprus' tax framework is one of the most favourable in Europe.

It provides a wide range of advantages to both individuals and legal entities that have Cyprus as their tax residence.

The inflow of foreign capital into Cyprus is noteworthy for the Cypriot economy. Many foreign investors transfer their business activities to Cyprus, taking advantage of the low corporate tax rate of 12.5% (one of the lowest in Europe).

There are ways to further reduce the effective tax rate to as low as 2.5%, which is achieved by financing new capital to generate income through the notional interest deduction.

Reduced taxation is also achieved for those dealing with Intellectual Property products through tax regimes (IP box regime).