Why form a company in Cyprus?
Cyprus applies a 15% corporate income tax rate from 1 January 2026. It also offers an IP Box framework for qualifying intellectual-property income and has a wide network of double-tax treaties.
The headline points: 15% corporate income tax from 1 January 2026 · IP Box treatment for qualifying income · substance and nexus requirements · EU member with a treaty network.
The IP Box regime
Under the IP Box, up to 80% of qualifying profits from qualifying IP can be treated as a deemed deduction, materially lowering the effective rate. It suits software, technology and IP-rich businesses, subject to the "nexus" substance rules linking the benefit to actual R&D activity in Cyprus.
What to consider
- Substance: real management, staff and premises in Cyprus strengthen tax residency and treaty access.
- Director & office: Cyprus tax residency generally requires management and control in Cyprus.
- VAT & compliance: registration, audited accounts and annual filings apply.
- Personal layer: owners who qualify as Cyprus non-doms may receive dividends without the Special Defence Contribution. See the non-dom regime.
This is general information only and not tax advice. Structuring must reflect real substance and your specific facts. A licensed Cyprus adviser designs and confirms the right structure.
Frequently asked questions
What's the corporate tax rate?
Cyprus applies a 15% corporate income tax rate from 1 January 2026. Different treatment may apply to qualifying intellectual-property income.
What is the IP Box?
It provides a deemed deduction for qualifying profits from qualifying intellectual property. A Cyprus tax adviser should confirm eligibility, nexus and the effective rate for your facts.
Do I need staff in Cyprus?
Genuine substance, including management, people and premises, can support tax residency and treaty access. The level required depends on the business.
Ask about a Cyprus company
Tell the assistant about your business. It will outline the general structure and the questions a Cyprus tax adviser should review.