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A presentation brought to youby Lawyers-Cyprus.com
Setting Up a Sole Trader in Cyprus
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What is a Sole Trader in Cyprus?
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• A sole trader in Cyprus is the simplest business form available on this market.
• It is a type of business which is suitable for natural persons who want to start a small business in Cyprus.
• However, it is important to know that there is no legal distinction between the entity and the businessman.
• Investors must also know they will be held fully liable for the business’ debts.
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Taxation Matters for Sole Traders in Cyprus
• Although a sole trader in Cyprus is a type of business form, the taxation of this type of structure is different than in the case of other commercial companies.
• A sole trader in Cyprus must pay the same tax applicable to natural persons - the income tax.
• This tax can reach an overall value of up to 35%.
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Open a Sole Trader in Cyprus >>
• The Cypriot sole trader is subject to the same regulations as the partnership.
• The main legal framework regulating sole traders is the Partnership and Business Names Law.
• The legislation is prescribed following the rules established in the Cypriot Commercial Code.
• Sole traders must register with the Cypriot Companies Registrar.
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>> Open a Sole Trader in Cyprus
• The registration must be completed before starting the business operations.
• Our team of lawyers in Cyprus can guide businessmen through the entire registration procedure.
• Citizens from EU and EFTA do not need a residence permit when opening a sole trader in Cyprus.
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Self-Employment in Cyprus >>
• Owning a sole trader in Cyprus means that the businessman will have the statute of a self-employed person.
• This is also applicable to small traders, such as partnerships in Cyprus.
• Another category of self-employed individuals are freelancers, who are allowed to conclude contracts with Cypriot companies.
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>> Self-Employment in Cyprus
• The commercial legislation stipulates that sole traders and self-employed individuals are not required to perform an audit on the company.
• However, this is applicable only in the situation in which the company’s annual turnover does not exceed 70,000 euros.
• Our team of attorneys in Cyprus can offer more details on this matter.
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Taxation of Sole Traders in Cyprus >>
• Sole traders in Cyprus must register for taxation purposes.
• They also have to register for social security.
• Taxation of an individual in Cyprus is performed on a progressive base system.
• For example, income below EUR 19,500 is free of charge.
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>> Taxation of Sole Traders in Cyprus• Income taxes for individuals are
imposed as follows:
income of up to EUR 28,000 – taxed at a rate of 20%;
income of up to EUR 36,300 - taxed at a rate of 25%;
income of up to EUR 60,000 - taxed at a rate of 30%;
income above EUR 60,000 - taxed at a rate of 35%.
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Business Services in Cyprus
• Our law firm in Cyprus can assist foreign businessmen in setting up a sole trader, but they can also provide legal assistance for the incorporation of any other legal entity available under the local legislation.
• Moreover, foreign investors can receive assistance from our lawyers for opening a branch office or a subsidiary in Cyprus.
Thank you for your attention!
• For more information please contact us at:
(+44)203-287 0408 (for international clients)
www.lawyers-cyprus.com 11