Understanding Cyprus' Economic Substance Requirements

Introduction

As the international corporate landscape changes, so do the various laws and regulations. Keeping pace with these changes can be difficult given each jurisdiction has their own quirks and specifics.

In this article we hope to clearly outline Cyprus' Economic Substance requirements and highlight the importance of ensuring any Cyprus Tax Resident Company has sufficient Economic Substance.

Requirements

Quite simply, for a company to be considered tax resident in Cyprus and enjoy the various corporate tax benefits available as a Tax Resident Company, it must be managed and controlled in Cyprus.

Although the term "Management and Control" is not defined in the Cyprus Income Tax Legislation, there is a list of factors to consider when ensuring a company has economic substance and as a result can be considered a Cyprus Tax Resident Company.