Action plan for attracting companies in Cyprus

Transformation of the existing Fast Track Business Activation Mechanism into a Business Facilitation Unit operating or expressing interest to operate in Cyprus.

Responsibilities:

• Provision of services for the establishment of corporate entities:
  i.   Company registration and name approval 
  ii.  Registration with the Social Insurance Registry and the Employers’ Registry
  iii. Registration with for VAT Registry and Income Tax
  
• Guidance for the establishment and operation of companies in Cyprus. 
  
• Facilitation for the issuance of residence and employment permits in Cyprus.

• Companies/ foreign businesses in Cyprus or foreign businesses wishing to establish presence in Cyprus which have a physical presence in Cyprus including establishment/ operation of independent offices that are separate from any private residence. 
• Cyprus shipping companies.
• Cyprus high technology / innovation companies.
• Cypriot pharmaceutical companies or companies operating in the fields of biogenetics and biotechnology.

Issuing of temporary Residence and Employment Permits in Cyprus for third country nationals with minimum acceptable gross monthly salary of €2.500, provided that the following conditions are met: 

• Possession of a university diploma or title or equivalent qualification or certificates of relevant experience in a corresponding employment position lasting at least 2 years.
• Presentation of an employment contract of not less than two years.

Employment of support staff (with gross monthly salary less than €2.500)
In addition, the employment of third-country nationals is permitted provided that it does not exceed 30% of all support staff and provided that the third-country national and the employer have entered into an employment contract duly approved by the relevant authority in accordance with the applicable law.

Duration of residence and employment permits 
The permits will be issued immediately within 1 month and will last up to 3 years.

Direct and free access to the labor market as paid employees to the spouses of those obtained a residence and or work permit in the Republic, and who receive a minimum gross monthly salary of €2.500 (not applicable for support staff).

• Beneficiaries 
  Third country nationals self-employed or employees who work remotely using information and communication technologies, with employers / clients outside Cyprus.

• Residence status
  i. They have the right to stay in the country for up to one year, with the right to renew for another two years.
  ii. They can be accompanied by their family members, to whom, upon request, a residence permit that expires at the same time as their dependent’s is granted. During their stay in Cyprus, the spouse or partner (concerns persons who have entered into a civil union) and the minor members of the dependent’s family are not allowed to provide dependent work or to engage in any kind of economic activity in the country.
  iii. If they live in the Republic for one or more periods that in total exceed 183 days within the same tax year then they are considered tax residents of Cyprus meaning they are not tax residents in any other State.
  
• Prerequisites:
  Among others:
  Evidence that he has sufficient resources, at a fixed income level, to cover his / her living expenses during his / her stay in the country, without burdening the national social welfare system. The amount of sufficient resources is set at €3.500per month and it can be supported: 
  i. from the employment or work contract or proof of employment, in the case of dependent work, services or work or
  ii. from a bank account. If sufficient resources come from paid employment services, services or work, the above minimum amount refers to net income after payment of the required taxes in the country of employment
  
  The above amount is increased by twenty percent (20%) for the spouse or cohabitant and by fifteen percent (15%) for each child.

• Medical Insurance
• Clean criminal record certificate from the country of residence

• Income Tax exemption of 50% to new residents-employees with income of € 55.000
• Existing beneficiaries of the scheme should be able to extend the benefit from 10 to 17 years. Potential beneficiaries with income (€ 55K- € 100K) for the remaining period of 17 years.

Consideration of the possibility of extending the tax exemption to 50% for investment in certified innovative companies and by corporate investors.

Granting an increased discount on research and development expenses (e.g. by 20%). Eligible research and development expenses will be deducted from taxable income equal to 120% of the actual.

Right to submit an application for naturalization after 5 years of residence and work in the Republic of Cyprus, instead of 7 applicable today, or after 4 years if they meet the criterion of holding a recognized certificate of very good knowledge of the Greek language. 

_Notes:

_{The Action Plan will be implemented from 1.1.2022 with the exception of actions 6-9 for which legislative regulations are required. The aim is for the relevant legislation to be submitted to the House of Representatives by the end of December and to be approved in the first quarter of 2022.}