Cyprus accounting offices and Employment Companies
The use of a Cyprus IBC can be tax advantageous to Individuals who are not tax residents in Cyprus and who receive substantial amounts of income and benefits in kind in respect of employment exercised outside Cyprus.
The right to receive their income and benefits in kind can be assigned to a Cyrus IBC. In other words, the Cyprus IBC would contract with the Employer for the performance of a relevant work and would invoice and receive payment accordingly. The Individual will be and employee of the Cyprus IBC.
The Individual will not be taxed in Cyprus personally for salaries received from his employment contract with the Cyprus IBC in respect of employment exercised outside Cyprus.
The net income of the Cyprus IBC will be subject to corporation tax at the rate of 10% after deductiong all relevant expenses including salaries, bonuses and other benefits paid to the Individual. Therefore, a small margin of the income wil be taxable in Cyprus at 10%.
The net profits after taxation of the Cyprus IBC can be distributed as dividends without any withholding taxes in Cyprus.