Benefits of Obtaining Cyprus Tax Residency Status

How to combine personal benefit and business interests in one location?

Are you an IT specialist, startup founder, international business owner, or investor with assets in multiple countries? You may have already considered how to optimize your taxes, maintain your business structure within the EU, and at the same time ensure a comfortable lifestyle for yourself and your family. Cyprus is one of the few countries that offers a solution to all these needs in one place

Cyprus tax residency is the optimal choice if you:

• want to legally reduce your tax burden;
• manage an international business or own structures in different countries;
• plan to relocate and obtain a residence permit (temporary or permanent);
• and are looking for a stable and secure EU jurisdiction for living and protecting your family’s interests.

Learn more about Cyprus tax residency status and taxes in Cyprus

First advantage: In Cyprus, you can obtain tax residency in two ways: through the standard rule by residing on the island for at least 183 days per year, or through the simplified 60-day rule. This makes the jurisdiction particularly attractive for international entrepreneurs, investors, and business owners operating across borders.

However, it is important to understand that obtaining a Cyprus tax residency certificate under the 60-day rule is possible only if certain conditions are met, each confirming your economic and legal ties to Cyprus:

• Physical presence in Cyprus for at least 60 days a year (can be non-consecutive).
• A registered company in Cyprus.
• The company must have a physical office, either rented or owned.
• A corporate bank account and a personal bank account of the beneficial owner.
• Residence permit obtained through employment in your own company.
• Residential address in Cyprus (either rented or owned).

Once these steps are completed, you can submit your application and obtain an official Cyprus tax residency certificate.

What does the tax residency certificate offer the beneficial owner?

• Official confirmation that you are subject to Cyprus tax law;
• The right to apply Double Tax Treaties (including with Ukraine, Poland, Germany, UAE, and others);
• Exemption from taxes on dividends, interest, and securities income, provided Cyprus residency conditions are met;
• A legal tax optimization tool that allows for more flexible asset and income management.

Second advantage for business: In practice, tax residency in Cyprus proves to be more effective than in several other popular European jurisdictions such as Malta, Madeira, or the Canary Islands.

Key tax advantages include:

• Corporate tax — 12.5%, one of the lowest in the EU.
• 0% tax on income from the sale of shares, bonds, and other securities.
• Income up to €19,500 per year is exempt from personal income tax.
• 0% tax on dividends from abroad (with the proper corporate structure).
• No inheritance, gift, or wealth tax.

By adhering to Double Tax Treaties, you can optimize not only your income, but also cross-border dividend distributions between countries where the beneficial owner holds assets.

Read also: How to Register a Company in Cyprus in 2025

Third advantage for the family of the beneficial owner: Cyprus offers not only unique opportunities for the beneficial owner but also significant benefits for their family. Thanks to its flexible legislation and high standard of living, relocating to the island becomes a comfortable and advantageous option for all family members.

• Residence permits (Temporary or Permanent) for the entire family. Family members of the beneficial owner — including a spouse and children — also have the opportunity to obtain a residence permit (temporary or permanent). This allows the entire family to relocate and legally reside in Cyprus.
• Access to healthcare and education. Beneficial owners and their family members gain access to the Cypriot healthcare system and educational institutions. The high quality of education makes Cyprus especially attractive for families with children of all ages.
• A safe and comfortable living environment. Cyprus is known for its high level of safety, warm climate, and welcoming atmosphere. This makes the country an ideal place for family life.

Thus, when approached correctly, Cyprus tax residency is not merely a formality — it becomes an effective solution: for business — tax flexibility and access to the EU, for the beneficial owner — a reduction in tax burden, for the family — stability and comfort.

Feod Group is an international law firm with an office in Larnaca, providing legal services in Ukraine since 1992 and in Cyprus since 2007. We assist clients through every stage of obtaining Cyprus tax residency, residence permits, business registration, and family relocation.

Our lawyers and accountants operate locally, offering full turnkey support — from developing a strategy to opening accounts, submitting documents, and obtaining certificates.

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Would you like to calculate how beneficial Cyprus tax residency can be in your specific case?

Leave a request — our experts will contact you and offer a solution tailored to your business and personal situation.

READ ALSO:

• Taxes in Cyprus: An Overview of the Tax System
• Key Advantages of Cyprus for International Business and Tax Optimization
• Corporate Taxes in Cyprus in 2025