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McMillan Cyprus > Our Services > Tax Planning

Tax Planning

Our firm provides a comprehensive range of tax services

Cyprus is an international financial centre due to having one of the lowest tax rates (12.5%) in the EU. An increasing number of foreign investors use Cyprus based companies for their international business.

Tax planning is an excellent opportunity to increase the bottom line of a business. Because we work so closely with our clients, we always identify opportunities to save money through astute tax planning, whilst complying with the tax legislation.

McMillan Woods Cyprus services cover all taxes that affect business entrepreneurs, bearing in mind that tax is a “business” cost. Our goal as a firm is to minimise tax liabilities. Our team of professionals work closely with our clients in order to develop a clear tax planning strategy; whether this is for a business corporation or for an individual.

Our tax advisors can assist individuals or legal entities to adopt the right company structure in Cyprus or abroad in a tax efficient manner. The legal structure will affect the total tax burden on the investment by maximizing the return to the shareholder. Our experienced team examines the nature of the investment, the possible tax aspects that may arise and proposes an optimum tax structure for implementation.

Our firm strictly believes that tax planning should be a proactive approach to investment decision making, rather than a reactive one, in order to protect the wealth of a company. We make sure to let our clients know that we can also review tax exposure of an existing structure and provide restructuring options when or if needed.

Tax Compliance

Our firm provides a comprehensive range of tax services. Through our experienced and qualified team, we ensure compliance with the current local and international tax legislation which includes the following:

Tax Advisory

  • International tax planning structures
  • Tax review
  • Tax rulings
  • Tax clearance

Tax Administration

  • Registration within the Inland Revenue Department
  • Preparation and submission of annual tax returns
  • Tax Residency Certificates
  • Preparation of annual income tax computations
  • Preparation and submission of Annual Provisional tax declarations

Cyprus Tax FAQs

Why choose Cyprus for my international business?

Cyprus has one of the lowest tax rates in Europe, the efficient legal, the accounting and banking system, the European standard of living, the hospitality, friendliness and the high level of competence of Cypriots as well as the strategic geographical location and the good social and industrial infrastructure are among the factors contributing to the success of Cyprus as an international business centre.

If I receive dividends from a subsidiary company to my Cyprus holding company what are the tax implications?

Dividend income is tax exempt and there is no withholding tax on dividends.

I have Intellectual Property (IP) Income, is there any tax reliefs?

Yes, Intellectual Property (IP) including copyrights, patented inventions and trademarks has an exemption of 80% of the overall profit derived from the qualifying intangible asset.

My current Cyprus Company owns shares in another company, If I sell those shares how much tax will I pay?

Profits realised on disposal of securities/shares in subsidiaries, bonds, derivatives, stocks etc., are not subject to taxation in Cyprus. This applies to all gains including capital gains and gains from trading in securities.

I am considering retiring and moving to Cyprus, how will I be taxed there with my overseas pension?

Foreign pension income is taxed at the flat rate of 5% on amounts over €3.420.

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