An introduction to the Cyprus limited liability company
Cyprus is an EU jurisdiction with a common law legal system and a tax framework relevant to international business and private wealth planning. The Cyprus limited liability company is a widely used vehicle by companies, private individuals, and their families for investment, structuring, and relocation purposes.
A private limited liability company is the most common corporate form in Cyprus. Companies are incorporated under a legal system based on English common law, offering a familiar and predictable framework for international advisers. Incorporation is generally efficient, and as an EU member state Cyprus provides access to the internal market and an extensive network of double tax treaties. There is typically no withholding tax on dividends, interest, or royalties paid to non-residents, subject to conditions.
From a corporate tax perspective, Cyprus applies a flat 15% corporate tax rate as of 1 January 2026, aligning the jurisdiction with international standards. Tax losses may be carried forward for up to seven years, and group tax relief is available for qualifying Cyprus companies. Profits from the disposal of securities, such as shares and bonds, are generally exempt from corporate income tax and capital gains tax.
Recent legislative developments have introduced greater clarity in relation to digital assets. Profits from the disposal of crypto-assets are taxed at a flat 8% rate, while losses may only be offset against profits arising in the same tax year. At the same time, long-standing incentives remain available, including the Notional Interest Deduction on new equity, the intellectual property regime, and enhanced deductions for qualifying research and development expenditure, allowing for reduced effective tax rates where applicable.
In addition to corporate considerations, Cyprus remains relevant from a personal tax perspective. The non-domiciled tax regime continues to attract internationally mobile individuals and families, particularly in relation to dividend and interest income, and plays an important role in both business structuring and relocation planning.
Our factsheet with details in an overview:
- why Cyprus remains relevant for international business;
- recent changes to the corporate tax rate, the treatment of carried-forward losses, and the taxation of crypto-assets;
- business incentives that remain unchanged, such as the Notional Interest Deduction, the intellectual property regime, and research and development tax benefits;
- the non-domiciled tax regime and its relevance for international business and individual relocation; and
- practical examples of effective tax rates on investment income, together with options for efficient capital and profit distribution.
For further information or to discuss how a Cyprus limited liability company may be relevant in a specific client context, please contact your usual KENDRIS adviser or a member of our
Cyprus team.
