ARTICLE · 16 NOVEMBER 2011

Intra Group Loans (Back-To-Back Loans) Through Cyprus

Soteris Pittas & Co L.L.C

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Cyprus Companies are in wide use as major vehicles in international tax structuring mainly due to the broad range of legal and tax related benefits they can offer because of the flexible tax system and the extended network of double tax treaties between Cyprus and other countries.

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Soteris Flourentzos

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Cyprus Companies are in wide use as major vehicles in international tax structuring mainly due to the broad range of legal and tax related benefits they can offer because of the flexible tax system and the extended network of double tax treaties between Cyprus and other countries. In this respect, there are certain advantages that have made Cyprus also a favorable financing company jurisdiction.

Thus, the use of Cyprus to "locate" the Financing Company of an international tax structure reduces the tax implications which are further reinforced by the clarifications of the Director of the Inland Revenue Department of June 2011 on the definition of minimum / maximum interest margin.

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