Amendments to the Tax Legislation in Cyprus

Kinanis LLC, Nicosia, Cyprus,
Thu, July 23, 2013 (USUBC member)

In an effort to accelerate growth and attract foreign investment, theGovernment of Cyprus proposed a major tax reform. The changes proposed are verypositive for the international investors who do business through Cyprus andcreate a new dynamic for the island.

The main changes introduced by the tax reform include:

• The introduction of a notional interest tax deduction on qualifying equity, making the investment of own capital extremely tax efficient.
• The introduction of the “Resident but not-Domicile” tax status for individuals and their full exemption from Special Defence Tax Law, putting Cyprus into the map of jurisdictions where HNWI can relocate and become tax residents.
• Various incentives to boost the real estate sector.

In this tax update we examine in more detail the above changes introducedand highlight the benefits offered to the international investors doingbusiness through Cyprus. In addition we briefly mention the additional proposedchanges in the Tax Legislation that are expected to be voted in September thisyear.

The Tax Update can be downloaded through our website from here.

Our firm regularly publishes dedicated publications regarding subjects ofinterest to the International Investors. You may visit our website for anexhaustive list and downloading of our publications.

In addition, for more effective and up to date information on Cyprus as aninternational business centre you can follow as on Twitterand on Linkedin.

Our Tax Department is ready to assist you with any clarifications you mightneed and to provide relevant consultation on the future steps that may beneeded.