In short
- Corporate tax is 15% from 1 January 2026, up from 12.5%, and a company incorporated in Cyprus is resident.
- The EU list of 9 October 2026 and the FATF lists of 19 June 2026 do not name Cyprus.
- Beneficial owners are filed within 90 days and confirmed every year from 1 October to 31 December.
- A dividend to a shareholder abroad bears no Cyprus tax, except 5% or 17% to companies in listed places.
In this guide
What offshore meant for Cyprus, and what the law says in 2026
An offshore company is registered in one country while its owners and business sit in another, and it pays little or no tax where it is registered. The law the Tax Department applies today is the Income Tax Law of 2002, in force from 1 January 2003. Its text as amended to Law 67(I)/2026 has no offshore company, no international business company and no second rate. A company is tax resident or it is not, and a resident company pays one rate.
| Date | What happened |
|---|---|
| 1 January 2003 | The Income Tax Law of 2002 takes effect. Its text today has no offshore regime |
| 1 May 2004 | Cyprus joins the European Union |
| 2013 | The OECD Global Forum rates Cyprus Non-Compliant overall on exchange of information on request |
| 29 October 2014 | Cyprus signs the OECD agreement on automatic exchange of financial account information |
| 2015 | A supplementary Global Forum review lifts the rating to Largely Compliant |
| 2020 | The second-round review keeps Largely Compliant |
| 1 January 2026 | The corporate rate rises from 12.5% to 15%, and a company incorporated in Cyprus is tax resident |
A company formed today is an ordinary private company of an EU state. We form it and you sign the papers where you live: company formation in Cyprus.
Is Cyprus 0% income tax? The rates of 2026
No. A company pays 15% on its taxable profit, and an individual pays 0% only on the first €22,000 of income a year. Both rates come from Law 244(I)/2025, in force from 1 January 2026.
| What is taxed | Rate in 2026 | Who pays |
|---|---|---|
| Company profit | 15%, against 12.5% until 2025 | A company that is tax resident in Cyprus |
| Income of an individual | 0% to €22,000, 20% to €32,000, 25% to €42,000, 30% to €72,000, 35% above | A resident individual |
| Dividend received | Exempt from income tax | Any person. A company loses the exemption to the extent the payer deducts the dividend abroad |
| Gain on the sale of shares and bonds | Exempt from income tax | Any person |
| Special Defence Contribution on a dividend | 5% | A shareholder resident and domiciled in Cyprus. A resident who is not domiciled pays none, and so does a person abroad |
| GeSY, the health system contribution, on dividends and interest | 2.65% of income up to €180,000 a year | A resident individual. A non-resident does not pay it on dividends or interest |
Three items carry a 0% rate. One is the first €22,000 of an individual's income. Another is the dividends and share gains of a company. The third is the Special Defence Contribution on dividends and interest of a resident who is not domiciled in Cyprus. A non-dom still pays GeSY. A resident is deemed domiciled after 17 of the last 20 tax years: non-dom status in Cyprus.
One profit and three owners
Take a company with €120,000 of profit in 2026. It pays €18,000 corporate tax and distributes €102,000. What the owner pays next depends on where the owner lives.
| Owner | Corporate tax | Tax on the dividend | Total and share of profit |
|---|---|---|---|
| Lives abroad | €18,000 | €0 | €18,000, 15% |
| Resident, not domiciled | €18,000 | €2,703 GeSY | €20,703, 17.25% |
| Resident and domiciled | €18,000 | €7,803: €5,100 contribution and €2,703 GeSY | €25,803, 21.5% |
The owner abroad pays whatever the home country charges on that dividend. We compute and file the company's tax: Cyprus tax services. The working from accounts to taxable profit is in the corporate tax rate guide.
Is Cyprus on a blacklist? The EU, FATF and Global Forum in October 2026
Three bodies publish the lists that answer this question. Cyprus is on neither of the first two lists, and the third rates it in the second of its four grades.
| List | Position of Cyprus | Date |
|---|---|---|
| EU list of non-cooperative jurisdictions (Annex I) and EU state of play (Annex II) | In neither. Annex I holds 8 jurisdictions and Annex II holds 10 | Council update of 9 October 2026 |
| FATF jurisdictions under a call for action, and under increased monitoring | On neither | Statements of 19 June 2026 |
| OECD Global Forum, exchange of information on request | Largely Compliant overall, the second of four ratings | Second-round review of 2020 |
The EU reviews its list twice a year and FATF issues its statements three times a year, so check the date of each before you quote it.
The Global Forum rating has a history. The first round rated Cyprus Non-Compliant overall in 2013, and the supplementary review of 2015 raised it to Largely Compliant. In 2020 the element on ownership and identity information was rated Partially Compliant, and accounting information and the quality of exchanges were rated Largely Compliant.
What stays visible: the company register, the owner register and the exchange of information
The Registrar's free search shows a company's name, registration date, type, status, registered office, directors, secretary and the date of its last annual return. The shareholders appear in the detailed search, which costs €10: searching the Cyprus company register.
A nominee director and a nominee shareholder put their own names into that register. Yours goes into the register of beneficial owners: nominee director and shareholder in Cyprus.
The register of beneficial owners
- Within 90 days of incorporation the company files its beneficial owners in the Registrar's online system. The form asks for the details, and no documents are attached.
- From 1 October to 31 December of every year the company confirms them online.
- A late filing costs the company €100 and a further €50 for each day, up to €5,000. The director is liable with the company unless the director exercised due diligence.
The Registrar suspended public access after the judgment of the Court of Justice of the European Union. Authorities can search the register, and so can obliged entities, which pay €3.50 for each company once the Registrar approves the request.
Account information moves between tax authorities under the agreement Cyprus signed in 2014, which the Tax Department runs with the EU's DAC2 rules. A cross-border arrangement can also be reportable under DAC6, the EU directive 2018/822 on mandatory disclosure.
We do this for you Company formation in Cyprus from €1,699
What still draws owners to a Cyprus company: payments abroad, holdings, IP Box and non-dom
Cyprus charges no tax on a dividend paid to a shareholder abroad in most cases. The Special Contribution for Defence Law reaches residents who are domiciled in Cyprus and, for payments out of Cyprus, two kinds of company abroad.
| Payment from Cyprus | Paid to | Cyprus charge |
|---|---|---|
| Dividend | A person or a company abroad, outside the two cases below | None |
| Dividend | A company resident in a low-tax jurisdiction | 5% |
| Dividend | A company resident in a jurisdiction on Annex I of the EU list | 17% |
| Interest | A company resident in a jurisdiction on Annex I of the EU list | 17% |
| Royalty for a right used in Cyprus | A non-resident that does no business in Cyprus | 10% |
A low-tax jurisdiction is a third country whose corporate rate is under half of the Cyprus rate. The Tax Department's circular 1/2026 names 11 for tax year 2026, among them the British Virgin Islands, the Cayman Islands, Bermuda and the Bahamas. A company registered in one of them but resident in a jurisdiction that is not low-tax falls outside the 5%.
Four rules explain why owners from abroad still come.
- The participation exemption. A Cyprus company receives dividends and sells shares without income tax. A dividend from abroad bears 5% in one case. More than half of the payer's activity gives investment income, and the payer's own tax burden is under half of the Cyprus burden, which is below 7.5%: a Cyprus holding company.
- The IP Box. 80% of the qualifying profit from a qualifying intangible asset is deducted, so the 15% applies to the remaining 20%, which gives 3% at best: the Cyprus IP Box.
- The treaties. The Ministry of Finance publishes the double tax agreements of Cyprus in a list numbered to 68. The Tax Department issues a certificate of tax residence to a company only where an agreement exists with the other country, for fee stamps of €80.
- The non-dom status. A resident who is not domiciled in Cyprus pays no Special Defence Contribution on dividends and interest.
Why a Cyprus company cannot be run from nowhere: residence, treaties and substance
A company is tax resident in Cyprus in two cases. Its management and control are exercised in Cyprus, or it is incorporated under the Cyprus Companies Law, unless a double tax treaty gives its residence to the other state. A company that moves its registered office or seat to Cyprus counts as incorporated there. The rule is in article 2 of the Income Tax Law, as Law 244(I)/2025 amended it.
The Tax Department's page gives three examples. A company incorporated and managed in Cyprus is resident under both tests. A company incorporated in Cyprus and managed from a treaty partner is resident in the partner under the treaty. A company incorporated in Cyprus and managed from a state with no treaty is resident in Cyprus by incorporation.
A plan that rests on incorporating in Cyprus and managing elsewhere ends one of two ways. The treaty partner takes the company's residence, or Cyprus keeps it. The law also ignores an arrangement that has no valid commercial reason and whose main purpose, or one of its main purposes, is a tax advantage. That is section 33A of the Income Tax Law.
A treaty benefit needs the certificate. The Tax Department issues it on form T.F.98 for companies, with the certificate of incorporation attached. The 13 questions of that form and the other tests are in economic substance requirements in Cyprus.
Who a Cyprus company does not suit, and who it does
A structure built to pay no tax or to stay unseen does not fit Cyprus. Company profit bears 15%, the owner stands in a register, account information is exchanged between tax authorities and banks ask about substance.
A Cyprus company suits an owner who wants an EU company that holds shares, licenses intellectual property or trades. It is taxed at 15% or at the reduced rates above, and the owner accepts that registers and tax offices see it. We form the company and file its registrations, returns and owner declarations: company formation in Cyprus. Tell us the activity and where the owner lives, and we say which of these rules apply.
