Cyprus Non resident company formation question

[MARTIANPUNK]

hello Everyone,

Inputs :
1- I develop apps and sell them for subscriptions and one-time lifetime memberships.
2- I am the sole owner of the business from Morocco with no interest in changing my residency.
3- My clients are worldwide, EU and Non EU

Question:
1- Can I open a Cyprus non-resident company?
2- What tax implications apply to my type of business ? Must I apply VAT ?
3- What requirements are required from me to own and run a Cyprus non-resident company business?
4- Do banks have any special requirements for non-resident companies?
5- Do any physical presence requirements apply to me as the sole Owner ? Are there any physical requirements applied to my company (Officies? secretary?)

Extra details :
I currently run the business with a Moroccan company but it has limitations in terms of companies that do business with Moroccan companies (like stripe) which I need. I also pay a lot of taxes.


Your help is much appreciated !

 

[Sols]

MARTIANPUNK said:
Question:
1- Can I open a Cyprus non-resident company?
Click to expand...

No, only for a few months. By December this year, there will no longer be such a thing as a non-resident company in Cyprus. Unless tax resident somewhere else, the company in tax resident in Cyprus.

https://cyprus-mail.com/2022/03/02/assessing-the-new-laws-to-fight-tax-avoidance/

MARTIANPUNK said:
2- What tax implications apply to my type of business ? Must I apply VAT ?
Click to expand...

At minimum, 12.50% corporate tax in Cyprus and VAT on sales to EU residents.

Legally, the company is tax resident in Morocco (because you control/manage it from there) and has to pay the same taxes as a Moroccan company.

MARTIANPUNK said:
3- What requirements are required from me to own and run a Cyprus non-resident company business?
4- Do banks have any special requirements for non-resident companies?
Click to expand...

No more non-resident companies, so a bit pointless to go through.

MARTIANPUNK said:
5- Do any physical presence requirements apply to me as the sole Owner ? Are there any physical requirements applied to my company (Officies? secretary?)
Click to expand...

All Cyprus companies must have a secretary and registered office address in Cyprus. This is something all service providers can provide. Shareholders don't have to be resident in Cyprus.

Toggle signature
This is the probably the answer to your question.

 

[racs]

MARTIANPUNK said:
I develop apps and sell them for subscriptions and one-time lifetime memberships.
Click to expand...

It is possible to register such a company in Cyprus, but in order to enjoy the general benefits of local companies and to avoid additional tax burden, it is necessary to become a resident (local) company in Cyprus.

MARTIANPUNK said:
What requirements are required from me to own and run a Cyprus non-resident company business?
Click to expand...

A minimum of one director;
A minimum of one shareholder;
An individual can be both a shareholder and a director;
A registered and verified Cyprus address is required;
The company must have a secretary (the individual can be a resident or non-resident);
The use of nominal service is allowed.

MARTIANPUNK said:
Do banks have any special requirements for non-resident companies?
Click to expand...

In order to open an account in Cyprus, you don't need to have a residency - all you will be asked for is a set of documents, including:

Passport or a valid identity card
A reference from the bank in your home country
Proof of address
Anticipated turnovers
Information on why you need the account
Of course, for companies, the requirements are different and will include company incorporation documents and all documentation by its shareholders.

 

[CyprusLawyer101]

MARTIANPUNK said:
hello Everyone,

Inputs :
1- I develop apps and sell them for subscriptions and one-time lifetime memberships.
2- I am the sole owner of the business from Morocco with no interest in changing my residency.
3- My clients are worldwide, EU and Non EU

Question:
1- Can I open a Cyprus non-resident company?
2- What tax implications apply to my type of business ? Must I apply VAT ?
3- What requirements are required from me to own and run a Cyprus non-resident company business?
4- Do banks have any special requirements for non-resident companies?
5- Do any physical presence requirements apply to me as the sole Owner ? Are there any physical requirements applied to my company (Officies? secretary?)

Extra details :
I currently run the business with a Moroccan company but it has limitations in terms of companies that do business with Moroccan companies (like stripe) which I need. I also pay a lot of taxes.


Your help is much appreciated !
Click to expand...

Hello,
Are you a Moroccan resident?
What Sols mentions in his reply is valid information on the status of the Cyprus non-tax resident company and the updates in the legislation.
However, provided circumstances permit, planning opportunities with a Cyprus company do exists which could give you a 0% tax. That is provided the practical requirements of the Cyprus tax authorities are what they are expected to be. If you would be interested to discuss your case as a possible candidate for setting up a Cyprus company, kindly let me know and I can PM you.

 

[racs]

CyprusLawyer101 said:
Hello,
Are you a Moroccan resident?
What Sols mentions in his reply is valid information on the status of the Cyprus non-tax resident company and the updates in the legislation.
However, provided circumstances permit, planning opportunities with a Cyprus company do exists which could give you a 0% tax. That is provided the practical requirements of the Cyprus tax authorities are what they are expected to be. If you would be interested to discuss your case as a possible candidate for setting up a Cyprus company, kindly let me know and I can PM you.
Click to expand...

no, I don't want to set up a Cyprus company. I am happy with my job right now. yeah in the future if need to set up I may contact you.

 

[MARTIANPUNK]

racs said:
no, I don't want to set up a Cyprus company. I am happy with my job right now. yeah in the future if need to set up I may contact you.
Click to expand...

I think he was refering to me with his post

First I would like to thank you all for your answers.

CyprusLawyer101 said:
Hello,
Are you a Moroccan resident?
What Sols mentions in his reply is valid information on the status of the Cyprus non-tax resident company and the updates in the legislation.
However, provided circumstances permit, planning opportunities with a Cyprus company do exists which could give you a 0% tax. That is provided the practical requirements of the Cyprus tax authorities are what they are expected to be. If you would be interested to discuss your case as a possible candidate for setting up a Cyprus company, kindly let me know and I can PM you.
Click to expand...

Yes I am a Moroccan resident and I want to remain Moroccan resident unless i really must change residency.

 

[CyprusLaw]

racs said:
It is possible to register such a company in Cyprus, but in order to enjoy the general benefits of local companies and to avoid additional tax burden, it is necessary to become a resident (local) company in Cyprus.

A minimum of one director;
A minimum of one shareholder;
An individual can be both a shareholder and a director;
A registered and verified Cyprus address is required;
The company must have a secretary (the individual can be a resident or non-resident);
The use of nominal service is allowed.


In order to open an account in Cyprus, you don't need to have a residency - all you will be asked for is a set of documents, including:

Passport or a valid identity card
A reference from the bank in your home country
Proof of address
Anticipated turnovers
Information on why you need the account
Of course, for companies, the requirements are different and will include company incorporation documents and all documentation by its shareholders.
Click to expand...

Generally you are correct but I should note the following:

(a) The secretary must be a Cyprus resident.

(b) I think we all wish that these were the only documents that would be requested by the banks in Cyprus. A very thorough source of funds kyc will have to be presented to the bank.

 

[CyprusLawyer101]

MARTIANPUNK said:
I think he was refering to me with his post

First I would like to thank you all for your answers.


Yes I am a Moroccan resident and I want to remain Moroccan resident unless i really must change residency.
Click to expand...

Yes I was replying to you 🙂 Being Morocan resident is good actually as there appear to be no CFC rules applying. You could be setting up a workable structure as per my description above. If you are interested to discuss this I can PM you.

 

[JimBeam]

Do yourself a favor and forget about Cyprus: the setup is expensive, you'll have to pay 12.5% CIT + 1% extra on top of that (13.75% effectively) if you do not pre-pay your tax, the banking is expensive, banks will rape you with KYC and will even charge you for that, expensive accounting and auditing services (min €3k/year easily €5k/year)...

Depending on your volumes, you should take into consideration:

1. UAE - 0% CIT or other taxes... they are more welcoming to African people, and IMO less expensive than Cyprus
2. Hungary or Montenegro have 9% CIT and Bulgaria has 10% and I guess all other services mentioned above will be cheaper
3. UK company at 19% CIT but easy to setup and cheap to maintain

 

[AndyAresa]

CyprusLawyer101 said:
Yes I was replying to you 🙂 Being Morocan resident is good actually as there appear to be no CFC rules applying. You could be setting up a workable structure as per my description above. If you are interested to discuss this I can PM you.
Click to expand...

Hello CyprusLawyer101, I may be interested in getting a Cyprus company with planning opportunities with 0% tax. Do you mind contacting me via PM?

 

[CyprusLawyer101]

AndyAresa said:
Hello CyprusLawyer101, I may be interested in getting a Cyprus company with planning opportunities with 0% tax. Do you mind contacting me via PM?
Click to expand...

I will PM you.