Investing in Cyprus: a Comprehensive Guide


Last updated on March 29th, 2024 at 10:40 pm

For a long time, Cyprus held the status “tax have”. The government imposed strict privacy laws, protecting the private banking center and had one of the lowest corporate tax rates ever seen. However, the Cypriot government had since realized that it was attracting the wrong kind of investors, and shifted its focus towards attracting reliable foreign investment.

With only 12,5% corporate tax, Cyprus still has one of the lowest rates in Europe, but is now fully compliant with EU and international tax laws. Besides low tax rates, Cyprus has all sorts of financial benefits, such as cash rebates for certain branches, tax reductions and exceptions, and exemptions for new residents. Are you interested in investing in Cyprus as well? This guide will help you get started.

Where to find investment projects

One of the governmental projects made to attract foreign investment is Project Bank. This project was developed by Invest Cyprus, a governmental organization enacted just to promote Cyprus as the perfect destination for foreign investors.

Project Bank is an online platform on which foreigners can find the right investements in Cyprus. Project owners and developers can post their projects after going through a thorough screening process to ensure that the project is legit. Once approved, foreigners can find projects that fit their portfolio and come in contact with the owner to discuss the investment.

Project Bank has connected many foreigners and Cypriot project owners, making it much easier for them to communicate. Because of the thorough screening process, it is completely safe. On the platform, you’ll find all sorts of projects: from private real estate to office buildings, holiday houses, and hotels.

The liberal Foreign Direct Investment policy

Cyprus has ranked high on the list of countries receiving Foreign Direct Investment (FDI). This is no surprise, as since the governments’ change of hearts, numerous sectors have seen a growth. The tourism sector is one of the most important sectors, and is believed to grow at least 5% over the next decade.

One reason for many foreign investors to choose Cyprus as a destination for their capital is because of Cyrus’ liberal Foreign Direct Investment policy. Because of its liberal policy, Cyprus has seen a boost in projects improving the island’s infrastructure and thus its image. And there is even more to come. Cyprus is preparing for the rise of tourism, by building luxury resorts, international marinas, and tourism infrastructure.

New roads have made it possible for both tourists and businesses to move people and goods quicker, a better telecommunication system has made international communication stronger, and new ports have made overseas transport a lot easier.

Many governmental incentives for foreign investors

To promote foreign investment into Cyprus, multiple financial benefits for foreign companies and individuals were put into enactment. By far the most important measure is the low corporate tax. Companies only pay 12,5% corporate tax, which is one of the lowest to be found in Europe.

Besides, Cyprus offers dividend participation exemption, meaning that you’ll enjoy a tax exemption for receiving and selling dividends. If you establish yourself in Cyprus as a foreigner, you’ll also receive a tax exemption. Furthermore, Cyprus has double tax treaties with over 60 countries, ensuring that you won’t be taxed twice.

Invest in Cyprus

Besides its liberal FDI policy and many investment opportunities, there are other significant reasons to invest in Cyprus. For example, the great strategic geographical location. Cyprus is part of the European Union, but is situated close to Northern-Africa and West-Asia as well. For this reason, Cyprus is a gateway for business from all over the world. Besides, business partners will never want to leave the island again after seeing the natural beauty of Cyprus’ impressive landscapes and beaches.

Real estate is one of the main investment destinations of Cyprus, but also filmmakers are encouraged to come to the island. As a part of Cyprus’ foreign policy, the island wants to promote itself through foreign films. In order to attract film makers, Cyprus has created some attractive incentives. For example, if your film is about Cypriot or European culture, you’ll receive a cash rebate of up to 40% and up to 50% tax exemption on the taxable income.

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