WHAT IS OFFSHORE ?

Offshore business is about using the possibilities offered by countries (commonly known as jurisdictions), whose legislation allows for certain advantages (tax, confidentiality, company structure, etc.) to be used by non-residents.

This means that a country, or jurisdiction, will allow registration of a company and offer them certain tax freedoms in exchange for an annual licence fee. It is normally a legal requirement that the registered company must not conduct any business or own any assets in the jurisdiction of incorporation.

This in turn allows companies to be set up in that jurisdiction, sometimes resident, sometimes not (depending on the legislation), to trade on an international basis taking advantage of the easier flow of money on the international markets. These jurisdictions often allow another company to be appointed as the Director and Shareholder of a company. Most countries today still partake in the idea that the flow of money in or out of the country has to be restricted, regulated, or at least monitored, and of course, taxed.

We offer offshore services and management in over sixty countries, our offshore companies and offshore trusts formation is fast and cost effective, you really do not need to look elsewhere.

If you need to open offshore corporate or offshore private bank account we can assist you to select the best country, the best structure and the most suitable banking institution.

For our clients' convenience we accept payments on line by all major credit cards, via PayPal, by bank-to-bank wire transfer, travelers’ checks or Western Union.

Learn more about Offshore

THE OFFSHORE MAP

Cyprus Company formation
International businesses may be operated in Cyprus under a number of legal structures some of which are described below.

Cyprus Company
The significant features of a Cyprus company, the most widely used local corporate vehicle, are:
• A minimum of one shareholder is required. Nominee shareholders are allowed and widely used. A foreign corporate or individual shareholder is permitted.
• A minimum of one director and one secretary is required. A corporate entity, foreign or domestic, may act as a director. Director’s information is available in the public record.
• There is no minimum share capital. It is customary to have an authorised share capital of €5,000 and an issued share capital of €1,000.
• Different classes of shares with different rights, such as profit sharing, redeemable preference shares and voting rights may be issued.
• Shares are issued in registered form only i.e. bearer shares may not be issued. • The company must have a registered office address in Cyprus. BoemaGroup can provide both
the registered office and company secretary.
• Meetings of shareholders may be held abroad. Written unanimous consent resolutions may be used.
• Audited annual financial statements and annual return must be submitted to the Registrar of Companies in both English and Greek. BoemaGroup can arrange for the appointment of a local auditor.
• Although shareholder information is part of the public record, beneficial ownership information is not disclosed to any regulatory authority.
• BoemaGroup maintains shelf companies and pre-approved Cyprus company names. With a shelf company the time frame from the date of changes (if any) until delivery, including notarised and apostilled corporate documents is approximately two weeks. With a pre-approved company name, the time frame from formation until delivery, including notarised and apostilled corporate documents is approximately three to four weeks.
• If a company is incorporated with a name that requires prior approval from the Registrar of Companies the incorporation process will take approximately four weeks.

International trustee services companies (itcs)

An overseas company, a Cyprus company or an international partnership may register with the Central Bank for the limited purpose of acting as a private or professional trustee.
International financial services companies (ifscs)
An overseas company, a Cyprus company or an international partnership may be licensed by the Securities and Exchange Commission to engage in the business of providing “financial services”. The term is defined as deal- ing in investments, managing investments, providing investment advice or establishing and operating collective investment schemes. Only branches, subsidiaries or associate companies with a good international reputation and established in countries where there is adequate financial supervision will be licensed by the Cyprus Securities and Exchange Commission to offer “financial services” to the public.
General or limited partnerships
International partnerships can be registered in Cyprus. Partnership profits are exempt from local taxes.
Branch of an overseas company
A foreign company may register a branch in the Republic of Cyprus. The same has no legal or tax effect but will allow the company to operate from Cyprus and commonly is adopted for commercial and marketing reasons.
Registration of a foreign company
A foreign company may register in Cyprus with the result of having two companies which are separate legal enti- ties. Both will have to prepare accounts, or at least for the Cyprus entity, and the company can become resident for tax purposes in Cyprus, taking advantage of the double tax treaties. Provided the alternate country of registration accepts the same and subject to certain tax laws, the company will only be liable for tax in Cyprus.
Merge of foreign company with a cyprus company
The foreign company, the non-Cyprus company, should at the end of the merge be dissolved and the assets trans- ferred to the Cyprus company. This option is an alternative to re-domiciliation.
Re-domiciliation to and from cyprus
Cyprus allows for the domiciliation of a foreign company into Cyprus and for a Cyprus company to re-domicile elsewhere provided the relevant jurisdiction allows for the same. In such a case the company will be de-registered in the country of formation and registered in the Country of the new domicile. Cyprus allows for all EU jurisdiction to re-domicile to Cyprus and a number of offshore jurisdictions such as British Virgin Islands and Bahamas.
societas europaea (se) in cyprus
• The SE has been subject to Community Law directly applicable in all EU Member States as of 8 October 2004. The Council Directive has been implemented in national law in all Member States.
• The Regulation allows enterprises of different Member States to establish SE without being constrained by local legislation. Although, according to Art. 249 of Treaty of European Union, the regulation has direct effect and therefore does not need to be introduced with separate local implementation act, the SE regulation still requires in many circumstances the implementation with local legislation.
• Under the SE, the companies that carry out business in different Member States can act as one Company under unified rules. By consolidating different companies in different regions under SE, strengths competition advantages as well as generates economical and psychological advantages.
• As the major advantages of SE, it is often revealed that the companies shall not establish anymore separate subsidiaries to different Member States in order to carry out business there, which management is expensive and time consuming as well as it facilitates the change of place of headquarter, should it be necessary.
• Another restriction currently encountered by traditional European companies is that they cannot merge, in a number of jurisdictions, with companies in other Member States. Under the SE Regulation, such a transaction could now be structured as a direct merger of both entities, either by way of formation of a new SE, or by conversion of one of the parties involved into an SE.

Taxation
The following is an overview of the tax treatment of companies in Cyprus. Please contact us for a full explanation of these rules and how they may apply to a proposed structure involving the use of a Cyprus company.
Non-resident company
If management and control is abroad (non-resident Directors) then the Cyprus company is not taxable in Cyprus. This type of company is mainly useful for trade purposes. It cannot benefit from any Double Tax Treaties to which Cyprus is a party and cannot obtain any Tax Certificates stating that it is resident/taxable in Cyprus.
Resident company
The use of such company is where access to one of Cyprus Double Tax Treaties is required or, in the case of a trad- ing company, where a certificate from the Tax Office is required to confirm that the company is taxable in Cyprus. The net profits of such companies are subject to income tax at 10%. However there are special rules for taxation of interest and royalty income.
Dividends
• Dividends received by a Cyprus company are not taxable and are excluded in the tax computation of net profits but are subject to a defense tax at 15%.
• However, dividends received from abroad are not subject to the defense tax if the Cyprus company’s holding in the dividend payer is more than 1% and if:
– Either the company paying the dividends derives its income mainly from trading activities (as opposed to investment income), or
– The company paying the dividend is from a “reputable” tax jurisdiction (i.e. pays reasonable taxes).
• Payment of dividends from a Cyprus company to non-resident corporate or individual shareholder is not sub- ject to any withholding taxes i.e. Defense tax of 15%.
Interest
• Half the interest received by a resident Cyprus company is exempt from income tax. Accordingly, in the tax computation half of the interest income is excluded and the balance taxed at 10%.
• All interest earned by the resident company is subject to the defense tax at 10%. For example, if a company earns CYP£100/€171 interest, it will pay CYP£5/€8.50 income tax and CYP£10/€17 defense tax.
• Where interest is derived from the normal trade or business the interest is not treated as interest, but as nor- mal income and only taxable under income tax rules at the standard 10% tax rate.
Royalties
• Royalties are subject to 10% tax on net profit and there is no withholding tax on royalties paid, if the use of the right is outside the Republic of Cyprus.
Double Tax Treaties in Cyprus
Cyprus has ratified 32 double tax treaties in place, covering 40 countries, including:

Armenia	Germany	Mauritius	Sweden
Austria	Greece	Moldova	Syria
Belarus Belgium	Hungary	Norway	Tajikistan
Bulgaria Canada	India	Poland	Thailand
China P.R.	Ireland	Romania	Turkmenistan
Czech Republic	Italy	Russia	Ukraine
Denmark	Japan	Singapore	United Kingdom
Egypt	Kuwait	Slovak Republic	U.S.A.
Finland	Kyrgyzstan	Slovenia	Uzbekistan
France	Malta	South Africa	Yugoslavia (former)