Question Dividends as non dom in cyprus

[uplana]

Sols said:
Dividends are not subject to personal income tax and as a non-dom you are excluded from the SDC.
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makes it a perfect place to relocate for people willing to do so, good weather, low tax, and affordable properties on the waterfront 😉

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[heliotrope]

PrestoR3 said:
Hi all!

If I move to Cyprus and live solely from foreign dividends (the only tax I will pay only 2.65% NHIS contribution) will it give me full access to Cyprus national health care services? By "full" I mean basically the same way as for the people on the payroll.

Thanks
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Access to healthcare is facilitated by paying social contributions on a salary or by being retired. You can pay yourself a minimal salary although it should be reasonably commensurate with your lifestyle.

 

[orangekangaroo]

heliotrope said:
Access to healthcare is facilitated by paying social contributions on a salary or by being retired. You can pay yourself a minimal salary although it should be reasonably commensurate with your lifestyle.
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What about paying the minimum wage of 10440 per year?

 

[OFC1]

GESY is 2,65% for employees and 2,90% for employers so you end up paying 5.55% anyway since the company is yours, too.

 

[heliotrope]

OFC1 said:
GESY is 2,65% for employees and 2,90% for employers so you end up paying 5.55% anyway since the company is yours, too.
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You need to be more specific here. You don't pay 5.55% on dividends, you pay 2.65%.

 

[orangekangaroo]

We are talking overseas dividends here that you can receive as a non-dom at 2.65% Gesy payments only. The Cyprus company is set up for employment purposes only.

Last edited: Feb 18, 2021

 

[ShillGates]

is 2.65% upto a max of 180k income, so about 5k.

in other words pay 5k for health insurance..... sounds good to me?

 

[CyprusLawyer101]

Hi Everyone,

Just to add my 2 cents,

Dividends for non doms are not subject to tax but they are subject to the newly introduced Yesy contributions;

Another thing to consider is paying yourself a salary from your company, which would allow you a tax free amount of up to 19,500 Eur in annual salary. This essentially would be deducted from your profits as an expense so will not suffer the 12.5% corporate tax.

There may other options available for reducing the 12.5% corporate tax, but these require further planning and depend on your actual operation.

I hope this helps,

Good Luck!
Lawyer101

 

[orangekangaroo]

Lawyer101 said:
Hi Everyone,

Just to add my 2 cents,

Dividends for non doms are not subject to tax but they are subject to the newly introduced Yesy contributions;

Another thing to consider is paying yourself a salary from your company, which would allow you a tax free amount of up to 19,500 Eur in annual salary. This essentially would be deducted from your profits as an expense so will not suffer the 12.5% corporate tax.

There may other options available for reducing the 12.5% corporate tax, but these require further planning and depend on your actual operation.

I hope this helps,

Good Luck!
Lawyer101
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You can pay a salary but you will forkout this:

• 16.6% social security
• 1.2% redundancy
• 0.5% training & development
• 2.0% Special Cohesion Fund
• 4.75% NHS rates

This makes for a grand total of 25.1%, which is a lot more than 12.5% plus the 2.65% Gesy on Dividends.

 

[CyprusLawyer101]

orangekangaroo said:
You can pay a salary but you will forkout this:

• 16.6% social security
• 1.2% redundancy
• 0.5% training & development
• 2.0% Special Cohesion Fund
• 4.75% NHS rates

This makes for a grand total of 25.1%, which is a lot more than 12.5% plus the 2.65% Gesy on Dividends.
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Thanks orrange kangaroo for point that out. That is correct!

Having said that, these dues provide for a rather direct receiving of benefits since you can claim claim pension after some time, get a redundancy pay if you ever go bust or cannot work in the company+ free medical access.

 

[orangekangaroo]

I rather put that money in a savings account than paying government insurance schemes.

 

[CyprusLawyer101]

orangekangaroo said:
I rather put that money in a savings account than paying government insurance schemes.
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That is understandable.

 

[glengoolie]

so if one has to pay GESY(healthcare) from dividends but is not allowed to get healthCARE from it, how is that legal? you pay for healthcare you cannot receive???? makes no sense. and i do not believe it. healthcare and social security are two very different things.

 

[Konstanz]

Lawyer101 said:
Just to add my 2 cents,

Dividends for non doms are not subject to tax but they are subject to the newly introduced Yesy contributions;

Another thing to consider is paying yourself a salary from your company, which would allow you a tax free amount of up to 19,500 Eur in annual salary. This essentially would be deducted from your profits as an expense so will not suffer the 12.5% corporate tax.

There may other options available for reducing the 12.5% corporate tax, but these require further planning and depend on your actual operation.

I hope this helps,

Good Luck!
Lawyer101
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What the point of Cyprus if you have to pay tax? Many countries have tax free minimums.
It's also an Island. I don't really see the advantages of Cyprus comparing to UAE

 

[CyprusLaw]

glengoolie said:
so if one has to pay GESY(healthcare) from dividends but is not allowed to get healthCARE from it, how is that legal? you pay for healthcare you cannot receive???? makes no sense. and i do not believe it. healthcare and social security are two very different
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You do get free healthcare from GHS.

 

[glengoolie]

yeah, that's what i though. why do people keep saying this stupid **** then?

 

[CyprusLaw]

glengoolie said:
yeah, that's what i though. why do people keep saying this stupid **** then?
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Did someone say that you won't have access to the healthcare system? If so I missed that post, this is not the case, if you pay for GHS than you have access to GHS. Anything else would be unconstitutional.

 

[glengoolie]

ok, it was just heliotrope in this trhead, who stated that multiple times. not multiple people.

 

[ShillGates]

For every natural person, the total maximum annual amount on which contributions will be paid is € 180,000.

so max gesy is about 4800 euro. WHich basically means you got health care for that ? so good deal?

 

[heliotrope]

glengoolie said:
ok, it was just heliotrope in this trhead, who stated that multiple times. not multiple people.
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Two different things are being confused.

You pay a 2.65% tax on dividends for the general upkeep of the health system. But this does not entitle you to (free) use of the health system. As for whether this is fair, people pay for plenty of things via their taxes for which they don't get a direct benefit. Do you expect a free stay in prison given that your taxes indirectly pay for their upkeep?

If you're retired, or paying social security contributions, you can benefit from free health care.