Cyprus tax optimization for stock, crypto traders?

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Matade

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Jul 16, 2024
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If you have non-dom in Cyprus which voids SDC 19% tax obligation, how does that apply to cryptocurrency sales or trading and stock, options sales or trading?

What is the best structure to setup in Cyprus for Cyprus non-dom resident to optimize tax for trading activities both in stocks and in cryptocurrencies?
 
You can trade under a Cyprus company and pay 12.5% taxes on it (which is‌ not too bad) or trade under an 0% tax offshore company and pay yourself dividends‍ from it. Now dividends are tax free in Cyprus. But this needs a solid setup⁠ so contact a lawyer.
 
Well...

It's not legal but the law is not currently enforced. It is done‍ by a large number of residents in Cyprus, that is not to say it is⁠ recommended or it won't be enforced later on. But it's not a priority for them⁤ at the moment.
 
You can trade under a Cyprus company.

Stock trading is non-taxable in Cyprus. With crypto⁣ the situation is slightly different but still a Cyprus company is an optimal solution. I⁢ have PMd you.
 
So if it's mostly stocks & options it's better to do it under your own‌ name, no company? It shouldnt be taxable if it's stocks & options traded on recognized‍ exchanges like the NYSE, right?

Do you pay GESY on capital gains?
 
Is it a tax event in Cyprus if I change Crypto to another Crypto for‌ example Ethereum (ETH) to USDC (Stablecoin) as a private investor, no thru a company? I‍ live In Cyprus and have the non-dom status.

Thank you for your help.
 
Bump, what is most tax efficient way to cash out crypto in Cyprus?
 
the most tax-efficient way is crypto to cash lol haha *just kidding‍ but still...
depending on your end goal and the amounts
 
I understand you're living in Cyprus as a non-dom, which is great. Regardless, I believe‌ you can establish a Cyprus company. Here's the idea: you create or develop a proprietary‍ algorithm for your trading methods, register it as software, and capitalize it as intellectual property⁠ (IP) with tangible proof of its value.

The company then uses this IP to trade,⁤ and all revenue generated through it is taxed at just 2.5% in Cyprus. Instead of⁣ distributing dividends, you can retain the earnings within the company after paying corporate tax. Alternatively,⁢ you could set up a holding company on top, for example, in the UK, where︀ dividends would be distributed tax-free to that entity and then to you personally in a︁ tax-efficient way as a non-dom. However, keep in mind that this could trigger management and︂ control considerations, potentially requiring additional economic substance, which might increase costs depending on your income︃ level.

Let me know if you need further clarification,happy to help!
 
You need to be resident in Cyprus to take the offer from the tax man?‌
how easy to create that property, you need a⁤ programmer to help with the tool.
 
1. No, you don't need to be a resident.
2. Yes, You need to make‌ the tool with some programmers. Maybe Upwork can help. I don't think "Metatrader" or things‍ like that would work. You need to develop *actual* IP if you don't want to⁠ get a fine if you get an audit.
 
If you can continue with Python and build a proper frontend that resembles an application‌ with eyes and a face, then yes, but it must look solid.
 
In Cyprus, non-doms don’t pay the 19% SDC tax on income like dividends, interest, or‌ rental income, and crypto and stock trading gains are generally tax-free for non-doms. To optimize‍ tax for trading, setting up a Cyprus International Business Company (IBC) or a private company⁠ is often the best structure. This keeps trading profits separate from personal income and benefits⁤ from Cyprus' low corporate tax rate (12.5%). Always check with a local tax advisor for⁣ tailored advice!
 
That IP is not‍ as easy to acquire actually. It isn't as easy as you make it out to⁠ be unless I'm missing something
 
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