The business premises of the Cyprus LImited (EU)
Setting up a proper permanent establishment is essential. The requirement for business premises is a fundamental prerequisite for tax recognition purposes in European countries.
Practical application of case law
The Republic of Cyprus (EU) does not categorically require a permanent establishment. If thebusiness is conducted exclusively within Cyprus, business premises may not be necessary.
On the other hand, if a Cyprus company is expected to conduct business activities within the EU, the following principle applies:
“No permanent establishment, no tax recognitionin other EU countries”
Example: The Cyprus company invoices a customer outside of Europe. If the Cyprus Limited does not possess a permanent establishment in Cyprus at the time of the invoicing, the tax authorities abroad may not recognise the customer’s expenditures for tax purposes. The customer’s business expenditures will thus not be tax deductible. As far as the tax authorities abroad are concerned, a Cyprus company without a permanent establishment does not truly exist and is considered to be a so-called “brass plate operation”. Whether that is correct or not, those are the facts.
Practical business application
How can the Cypruscompany set up a proper permanent establishment?
The creation and presentation of a proper permanent establishment is achieved firstly through the rental of an appropriate office in Cyprus (EU). In addition, outfitting the establishment with basic technical equipment and furnishings is required.
1. Business premises for the active Cyprus Limited
Your company in Cyprus is a trading or consultancy company or a services provider. The office needed in such a case must have at least one separately locked room with a telephone connection, internet access and a desk. The monthly costs are between € 150.00 and € 300.00 and are tax deductible in Cyprus.
2. Business premises for the Cyprus Holding
Your business is a holding company. As in the previous example, a basic and separately locked office should again be rented. There is no minimum requirement for the size of theoffice. Most likely, you will not need more than a telephone, an internet connection and a desk. The monthly costs will be between € 150.00 and € 300.00, which are expenses that are deductible for tax purposes.
3. Business premises for manufacturing companies in Cyprus
Companies trading in goods or manufacturing goods are not required to have their own local warehouse or manufacturing facility, insofar as it can be established to be unnecessary for logistical reasons. Again, a simple office with basic furnishings as in the previous two examples is sufficient.
We will take care of your business premises in Cyprus
Arranging for a proper permanent establishment in Cyprus requires no witchcraft and does not entail significant costs. We are happy to help you in this regard.
The first step will be to advise you on your individual needs needsregarding the recommended size and furnishing of your premises. In addition, upon your request, we will assist you in the search for an appropriate location and also with the rental agreement.
Once that is done, we will be available to help you with the furnishing of your establishment, the registration of your telephone and internet connection and to arrange for the proper signage on the outside of the building.
Additional services for you and your company
Employees for your company in Cyprus
Do you want to employ staff in Cyprus?
We possess a comprehensive database of suitable and multilingual personnel.
The labour costs in Cyprus are relatively low. A part-time worker can be found starting at approximately EUR 250.00 per month and a full-time employee earns around EUR 900.00 per month.
Office services for startups and companies active outside of the EU
We offer you a professional and cost-effective solution. Our office service is ideally suited for the startup phase of your business and is also available on an ongoing and long-term basis should your business activities be limited exclusively to the non-EU economic region.
Our services: a representative business address in Cyprus, the direct forwarding of incoming postal mail, the scanning and forwarding of your postal mail via email, and the answering of incoming phone calls on behalf of your company.
The annual costs for the “virtual office” amount to € 964.00 plus 19% VAT.
Information and English language consultation
Do you have any questions, wishes or do you require a written proposal? We are at your service and happy to help.