Company formationEuropeCyprus company formation for EU-focused businesses
A Cyprus limited company is an EU-resident company used by founders who need dependable European banking and payment access for activities that banks review closely. As of 2026 it pays 15% corporate tax on profits, and dividends paid to non-resident shareholders generally carry no Cyprus withholding tax.
Updated
The typical structure is simple: the company earns the profits, the founder draws a market-level salary that is deductible for the company and taxed under the normal personal bands, and what remains after 15% corporate tax is distributed as dividends.
For a non-domiciled Cypriot tax resident, those dividends carry no special defence contribution. For a shareholder living elsewhere, Cyprus generally levies no withholding tax on dividends, except on payments to companies in EU-listed non-cooperative jurisdictions and, from 2026, to related companies in low-tax jurisdictions.
Cyprus also works as a holding location inside the EU: dividends received are generally exempt from corporate tax, outgoing dividends to most non-residents carry no withholding, and the treaty network is broad. Substance is the condition: local directors, real decision-making and proper bookkeeping.
Non-EU owners can use Cyprus too, but banks usually expect resident directors, and living on the island requires a residence permit rather than simple registration.
Licensed Cypriot accountants and lawyers provide the tax and legal advice; we coordinate formation and introductions.
Who it suits
EU founders with banking-sensitive models
Crypto-adjacent, trading, fintech-adjacent, platform or international service businesses that need EU banking.
Founders relocating to Cyprus
You will live in Cyprus, act as director and pay yourself a salary.
EU holding companies
You want an EU holding company with exempt dividend income and treaty access.
Groups needing an EU contracting entity
Your counterparties or payment providers require a company incorporated in the EU.
Requirements
- Required
Registered office in Cyprus
The statutory address of the company.
- Required
At least one director
Banks expect directors who genuinely manage the company, ideally resident in Cyprus.
- Required
Shareholder and beneficial owner details
Recorded with the Registrar and the beneficial ownership register; anonymous ownership is not available.
- Required
Audited annual accounts and tax return
Cyprus companies file audited financial statements every year.
- Depends on your case
Resident director for non-EU owners
Often needed where the owner does not relocate, so banks see local management.
- Depends on your case
Owner relocation
Moving to Cyprus strengthens substance and opens the personal non-dom position.
Documents
- Memorandum and articles of associationThe constitution filed with the Registrar of Companies.
- Identity and address proofsFor directors, shareholders and beneficial owners.
- Business plan and expected flowsBanks and EMIs use it to assess the activity.
- Source-of-funds evidenceFor the share capital and initial funding.
- Registered office agreementConfirms the statutory address in Cyprus.
Timeline
- 1Structure and name approvalAgree shareholding, directors and whether a holding layer is needed; reserve the name.
- 2IncorporationFile the constitutional documents with the Registrar of Companies.
- 3Tax registrationObtain the company tax number and register for VAT where required.
- 4Bank and EMI onboardingApplications to matched institutions, each running its own due diligence.
- 5Ongoing complianceBookkeeping, audit, tax returns and beneficial ownership updates.
Tax notes
- Corporate income tax is 15% from 1 January 2026, charged at company level on net profits after deductible costs such as the owner's salary.
- Dividends paid to non-resident shareholders carry no Cyprus withholding tax, except 17% on payments to companies in EU-listed non-cooperative jurisdictions and 5% on payments to related companies in low-tax jurisdictions.
- Dividends received by a Cyprus company are generally exempt from corporate tax, which supports holding structures, subject to anti-abuse rules.
- The owner's salary is taxed under the personal bands and social insurance, and the expense reduces corporate profit.
General information, not tax advice. Your position depends on your circumstances.
Banking fit
- Best fit: EU owners with a resident director and a clear business narrative.
- Non-EU owners who do not relocate should expect more questions or a requirement for local directors.
- EMIs complement traditional banks for payment flows; all accounts remain subject to due diligence.
Questions
Is a Cyprus company an offshore company?
No. It is an EU company subject to EU directives, audit requirements and beneficial ownership registers. That status is why EU banks, EMIs and payment providers tend to accept it more readily than low-tax jurisdictions outside the EU.
How are dividends from a Cyprus company taxed?
Profits are taxed at 15% in the company. Dividends to non-resident shareholders generally carry no Cyprus withholding tax, and non-domiciled Cypriot residents pay no special defence contribution on them. Your country of residence may still tax them.
Can a non-EU citizen own a Cyprus company?
Yes, but banks usually want to see local management, which often means a resident director. Living in Cyprus personally requires a residence permit, so plan the company and the residence route together.
Do I need to move to Cyprus?
Not to own the company, but relocation makes substance and banking easier and is required for the personal non-dom benefits. Without it, expect local directors and closer bank scrutiny.
Is Cyprus good for a holding company?
Often, yes. Dividends received are generally exempt from corporate tax, outgoing dividends to most non-residents carry no withholding tax, and Cyprus has a broad treaty network. Real substance in Cyprus is essential for the structure to hold.
More in Cyprus
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- ResidencyCyprus tax residency and relocationCyprus tax residency is available to people who spend more than 183 days a year on the island or meet the 60-day rule through local work, a home and limited time elsewhere. As of 2026, non-domiciled residents pay no defence contribution on dividends and interest for up to 17 years.View
Company formation elsewhere
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Ireland
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Sources
- Cyprus Tax Department: Tax residency and domicile, retrieved 2026-10-25
- Government of Cyprus: Tax reform in force from 1 January 2026, retrieved 2026-10-25
- KPMG Cyprus: Main provisions of the tax reform, retrieved 2026-10-25
- EY Global Tax News: Cyprus enacts major tax reform legislation, retrieved 2026-10-25
- PwC Worldwide Tax Summaries: Cyprus, individual income determination, retrieved 2026-10-25
- PwC Worldwide Tax Summaries: Cyprus, corporate withholding taxes, retrieved 2026-10-25
- PwC Cyprus: Tax Facts & Figures 2026, retrieved 2026-10-25
- Redomiciled case experience: Cyprus company and banking files (internal), retrieved 2026-10-25
- Redomiciled case experience: relocations to Cyprus (internal), retrieved 2026-10-25
Reviewed by the Redomiciled team on .
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