Cyprus Your strategic investment choice Cyprus | Your strategic investment choice Contents Foreword 3 Quick facts about Cyprus 4 Living in Cyprus 5 The Cyprus economy 6 Doing business in Cyprus 8 Corporate taxation 9 Personal taxation 10 Migration 12 Our services 13 2 Cyprus | Your strategic investment choice Foreword I am pleased to introduce our guide “Cyprus, your strategic investment choice”. This guide aims to introduce Cyprus to potential investors and expatriates wishing to migrate to Cyprus to combine business and pleasure. Cyprus is a beautiful sunny island, where one can enjoy a high quality of life, a modern lifestyle and a safe environment to raise a family. At the same time, Cyprus offers a number of investment opportunities and ideal conditions for running a business with international operations. Deloitte can offer practical solutions to entrepreneurs considering of moving to Cyprus. With a globally connected network of member firms in more than 150 countries and territories and approximately 330.000 professionals, our mission is to offer unparalleled service, tailored to your needs. As the information contained in this guide is generic, we encourage you to contact our specialists to obtain detailed and up-to-date advice specific to your own circumstances. We at Deloitte look forward to working with you. Sincerely, Pieris Markou Chief Executive Officer (CEO) Deloitte Cyprus 3 Cyprus | Your strategic investment choice Quick facts about Cyprus Location Languages Infrastructure Cyprus is the third largest island of the The official language is Greek, although Cyprus offers excellent road, air and sea Mediterranean, strategically linking Europe, English is the principal business language transport solutions and services. There Africa and Asia. and is spoken by the large majority of the are two multi-purpose deep sea ports, people on the island. located in Limassol and Larnaca. The EU Membership and Currency Limassol port handles both passenger Cyprus has been a member of the EU since Political system and freight cargo while offering logistics 1 May 2004. Its currency is the Euro since Cyprus is a Presidential Democratic State. solutions through advanced facilities for 1 January 2008. The Executive authority is vested in the cost-effective transport and processing. President, who is elected for a 5-year In addition, the Limassol port is a Total Area and Population term by Cypriot citizens, and is exercised renowned cruise liner hub and a popular The total area of Cyprus is 9,250 km2 with by a Council of Ministers appointed by “stop-over” for international cruise ships. a coastline of 648 km and a population of the President. The Legislative authority is Two modern international airports in 865,000. exercised by the House of Representatives, Larnaca and Paphos, offer their services to whose Members are elected by Cypriot approximately 10 million visitors per year, Principal cities citizens every five years. The administration connecting the island to popular transit The principal cities of Cyprus are Nicosia of Justice is exercised by the Judiciary, hubs throughout the world including (the capital), Limassol, Larnaca and Paphos. which is a separate and independent body. Athens, Vienna, London, Dubai and Moscow. Population 865,000 Languages Greek | English GDP Growth in 2019 3.1% Membership EU GDP for 2019 €22 bn Currency Euro Credit Rating as at April 2020 BBB- Climate Two modern Mediterranean, with over international airports 320 days of sunshine Human Development Index (HDI) Two multi-purpose High deep sea ports 4 Cyprus | Your strategic investment choice Lifestyle The island is well known for the high quality of life it offers, its rich culture, the hospitality of its people, its sunny weather, its clean and beautiful beaches and an abundance of outdoor activities. At the same time, it offers an ideal place to raise a family with good education and healthcare systems and one of the lowest crime rates within the EU. With over 170,000 foreign nationals, Cyprus is an exciting and diverse place to live in. Culture The rich cultural landscape is reflected in the archaeological sites, museums and monuments located throughout the island. Local and international festivals, music concerts and other cultural events take place throughout the year. Outdoor activities Living in Cyprus With over 320 days of sunshine, Cyprus is the ideal place to enjoy a wide variety of outdoor activities. Running in Pedieos River The country offers an enviable combination of Linear Park in Nicosia, cycling along the coast of Paphos and Limassol, swimming climate, business and culture and many incentives in Ayia Napa and Protaras, windsurfing in for relocation. Cyprus has an advanced economy Larnaca and hiking in Troodos are just few of the activities one can enjoy. and a high human resource development index (HDI) with regards to living and quality of life. Education Cyprus has over 20 reputable English- speaking primary and secondary schools. In addition, Cyprus offers internationally recognised colleges and universities. The island ranks among the highest in the EU in respect of university graduates in proportion to its population. Healthcare Cyprus has an easily accessible healthcare system, both in the public and in the private sector. EU citizens and people who are permanent residents in Cyprus are eligible for state healthcare, whilst non-EU citizens need private healthcare, the cost of which is relatively affordable. Cyprus has six public general hospitals, a modern oncology centre and more than 70 private hospitals and healthcare clinics. Finally, a general healthcare system has been recently introduced. 5 Cyprus | Your strategic investment choice The Cyprus economy Cyprus is a modern and adaptable free- economy, accounting for nearly 80% of the market economy with a positive long-term country’s GDP. More recently Cyprus has outlook. Over the past few years, the also invested and focused in a number of country has exceeded international young but growing industries including expectations and kept a steady pace funds, innovation and films. in improving efficiency, implementing reforms and boosting investor confidence. Key sectors GDP growth is projected to increase by 3.75% in 2021, when output is expected Professional services to slightly exceed its pre-pandemic level. Cyprus is recognised as a centre of The recovery is expected to be driven excellence for the provision of professional by domestic demand and ongoing corporate services. Its EU membership, infrastructure investment projects. highly educated, English-speaking population, strong information and Investment opportunities HHH communications technology infrastructure, Cyprus offers a number of investment attractive tax regime, extensive network opportunities in the traditional areas of of tax treaties, robust legal system and professional services, tourism, shipping, business-friendly environment, attract real estate and energy. These are numerous multinational companies to considered as the backbone of the Cyprus Cyprus. 6 Cyprus | Your strategic investment choice Tourism HHH Tourism represents one of the largest economic sectors in Cyprus and has experienced substantial growth over the last decade, with more than 3 million tourists visiting Cyprus every year. Enhancing the tourism industry is one of the primary objectives of the government and the competent authorities. Cyprus offers investment opportunities in large-scale development projects, such as theme parks, marinas, tourist resorts and golf courses. Furthermore, the government is in the process of developing a single integrated casino resort, expected to be the largest in Europe and to attract over 300,000 additional tourists per annum. Shipping Cyprus is a renowned international shipping centre and home to some Energy Innovation leading players in the global shipping The existence of deep-water natural gas Cyprus is the ideal destination to start industry. It has an EU approved “open reserves in Cyprus’s EEZ has attracted and scale companies. Innovative research registry” regime with a broad tonnage tax worldwide attention and significant encouraged through EU or national system covering the three main “maritime investments from leading independent funding, a rapidly growing start up transport” activities: ship ownership, ship energy companies. Furthermore, Cyprus ecosystem, and a series of attractive management and chartering. More than is used as a regional energy hub for tax incentives for qualifying Intellectual 1,000 vessels with a tonnage in excess companies which provide support services Property (IP) and innovative businesses, of 20 million are registered under the in the Eastern Mediterranean. have placed Cyprus on the global start-up Cyprus flag, making Cyprus the 10th largest map. Many successful tech companies have merchant fleet in the world. Growth sectors already either relocated or expanded in Cyprus, using the country as a base and Cyprus’s shipping taxation regime is Funds HHH gateway to and from the EU. considered as one of the most attractive The Funds industry in Cyprus is rapidly in the EU as it offers both simplicity and evolving. The stable legal environment, Films HHH significant tax savings for EU flagged ships. strong network of professional service Deep blue seas and sandy beaches, Qualifying owners of EU flagged ships, providers and the competitive regulatory captivating forests and breath-taking charterers and ship managers can opt to and tax framework has attracted a number mountains,