How to set up a consulting company in Cyprus?

Setting up a consulting company in Cyprus is an attractive opportunity for entrepreneurs seeking to enter the international market and take advantage of the favorable tax climate of this country. Cyprus has long established itself as a business hub, attracting companies and investors from all over the world. Flexible taxation system, availability of qualified labor force, developed infrastructure and ease of doing business make it an ideal jurisdiction for opening many areas of business.

Today we will talk about consulting, consider the main stages of setting up a consulting firm in Cyprus, legal aspects and requirements, as well as key advantages of working in this country.

Why is it beneficial to register a consulting business in Cyprus?

Registering a consulting business in Cyprus has a number of advantages that make this jurisdiction particularly attractive to companies operating in the field of professional services. Let’s consider why consulting companies can benefit significantly by choosing Cyprus as their base.

• Favorable tax conditions for international transactions

For consulting companies operating in the international market, it is especially important to minimize tax costs. Cyprus offers favorable tax conditions, with all company income, regardless of whether it is earned in Cyprus or abroad, subject to a flat corporate tax rate of 12.5%. This allows consulting companies to effectively plan their tax expenses, maintaining transparency and predictability of tax liabilities

• No licensing requirements for consulting activities

Unlike some jurisdictions (such as the UAE), in Cyprus, opening a consulting company providing business or management services does not require special licenses. The exception is financial activities, which, as in other EU countries, are subject to mandatory licensing. This simplifies the process of starting a business in the consulting field, if it is not related to finance, and reduces the costs of its organization.

• Wide range of opportunities for expanding the client network

Consulting activities in Cyprus provide an opportunity to cooperate with both local and international clients. As a financial and business center, Cyprus is home to many foreign companies that require support in tax matters, legal support, strategic planning and other aspects of business. This opens up prospects for creating long-term partnerships with companies around the world.

• Easy to withdraw profits and no currency controls

Cyprus not only offers favorable tax conditions, but also simplifies the process of profit withdrawal. The absence of currency controls allows consulting companies to easily move capital and transfer profits abroad. This is an important aspect for international businesses, which often face restrictions and currency risks in other jurisdictions.

• Opportunities for structuring and optimizing international business

Cyprus allows for efficient structuring of international business through the creation of holding or subsidiary companies, which can significantly increase the operational efficiency of a consulting company. Many consulting firms use Cyprus companies as an intermediate link between the main organization and clients in other countries, which helps to minimize tax expenses and protect assets.

• Jurisdiction image and international perception

Although Cyprus had an offshore status in the past, which raises doubts among some partners, today it is part of the European Union and strictly complies with international legal and tax regulations. The Cyprus jurisdiction meets high standards of transparency and legality, which makes it competitive among other European countries. Despite possible prejudices, a real office in Cyprus can demonstrate reliability and compliance with EU requirements, which is especially important for attracting large corporate clients and building long-term partnerships. Thus, registering a consulting company in Cyprus provides a number of financial, operational and strategic advantages that allow the business not only to work effectively, but also to confidently develop at the international level.

Stages of establishing a consulting company in Cyprus

Setting up a consulting company in Cyprus requires compliance with a number of procedures and requirements, which include both legal and administrative aspects. The registration process may seem complicated at first glance, but with the right approach it becomes quick and straightforward.

1. Choosing and registering a company name

The first step is to choose a unique name for your company. The name must comply with the requirements of Cyprus law, not infringe on existing trademarks and not contain prohibited words (for example, those that imply a license, such as “bank” or “insurance”). Once chosen, the name must be registered with the Department of the Registrar of Companies of Cyprus, which will check it for uniqueness.

2. Preparation of constituent documents

To register a company, the following constituent documents are required:

• Memorandum and Articles of Association: These documents define the objectives and scope of the company, as well as the rights and obligations of the shareholders and directors.
• Founders’ Resolution: A document in which the founders confirm their intention to establish the company.

These documents must be drawn up in accordance with Cyprus law and signed by all founders.

3. Selection of director and shareholders

Cyprus companies are required to have at least one director and one shareholder. The director can be either an individual or a legal entity; since 2023, the company’s residency no longer depends on the presence of a foreign director. Shareholders can be both residents and non-residents of Cyprus.

4. Company registration with the Department of the Registrar of Companies

After preparing all the documents, you must apply for company registration at the Department of the Registrar of Companies. This process usually takes from a few days to a week. As a result, the company receives the following certificates: certificate of registration, certificate of legal address, certificate of shareholders, certificate of director and secretary.

5. Opening a bank account

There is no mandatory requirement to open a bank account in Cyprus for the company to function properly – accounts can be opened in other countries as well. However, to enhance the company’s status, it is recommended to open a current account in one of the Cypriot banks. This simplifies financial transactions, tax payments and bookkeeping, and also demonstrates commitment to the local jurisdiction. Cypriot banks offer convenient multi-currency accounts and services, which makes it easier to work with international clients.

6. Registration with tax authorities and obtaining a VAT number

Once the company is registered, it is necessary to register with the Cyprus Tax Authority and obtain a Tax Identification Number (TIN). If you plan to work with clients in the European Union, you will also need to register with the VAT system and obtain a VAT number. Companies with turnover from the EU and Cyprus activities exceeding €15,600 per year are required to register for VAT, which allows clients to reimburse value added tax.

7. Accounting and reporting

Cyprus has a strict accounting system and every company is required to submit financial statements for the year. The statements must be prepared on the basis of International Financial Reporting Standards (IFRS) and must be certified by an auditor.

The process of registering a consulting company in Cyprus, although it requires a certain number of formal steps, is relatively quick if properly prepared. Once all the steps have been completed, the company can officially start its activities and operate both locally and internationally.

Bcorp is ready to offer comprehensive assistance at all stages of setting up a consulting company in Cyprus, if necessary. We will help with company registration in Cyprus, preparation of incorporation documents, opening bank accounts, tax registration and any other legal and bureaucratic issues. Our team of lawyers and accountants will help make the process of starting a business in Cyprus quick and efficient, providing support at every stage.