* UPDATED March 2023 *
The Council of Ministers approved on October 15th, 2021, the “Strategy for Attracting Businesses for Activities or/and Expansion of their Activities in Cyprus” and the implementation of the strategy commenced in January 2022.
The new Strategy will include the following:
Transformation of the existing Fast Track Business Activation Mechanism into a Business Facilitation Unit
The Business Facilitation Unit will function as the central contact point for business in order to coordinate and direct all the international companies which are either operating in Cyprus or are interested to operate in the country, as well as for Cyprus companies operating in specific areas of economic activities, such as Cypriot high-tech or innovation companies, Shipping companies, Pharmaceutical companies or companies operating in the Biotechnology and Biogenetics fields. The Business Facilitation Unit will provide guidance and information on the necessary licenses that are required for a company to operate in Cyprus, as well as to accelerate the issuance and renewal of employment and residence permits.
New Policy for the Employment of Third Country Nationals
Simplification and broadening of the existing policy for Highly Skilled Third Country National employees with a minimum gross monthly salary of €2,500. The permits will be issued within one month and the duration of the residence and employment permit it is up to 3 years. The maximum number of the Third Country Nationals employees is set at 70% of all employees over a period of 5 years starting from the day of joining the Business Facilitation Unit and after the lapse of 5 years, if the company will not be able to employ 30% of Cypriot or EU works, the matter will be re-examined.
Right to Family Reunification of Third Country Nationals included in third country employment policy
Spouses of employees who obtained a residence and employment permit in Cyprus and who receive a minimum gross monthly salary of €2,500, can have immediate and free access to the labour market.
On 30/11/2022, the Council of Ministers approved the Amendment of the Policy for the Registration of Companies in the Register of Foreign Interest Companies.
The Decision modifies the eligibility criteria of foreign interest companies and specifically includes the criterion of a company’s obligation to prove an initial investment in the Republic of at least €200,000, which should be proven by presenting the appropriate certificates. The Decision entered into force on December 12, 2022.
Digital Nomad Visa (Introduction)
People who wish to live in Cyprus and who are freelancers, employed or self-employed and working remotely in companies operating abroad, can obtain permits issued for one year with the option to renew for another two years. Holders of the Digital Nomad Visa must earn at least €3,500 per month, have medical insurance, and have a clean criminal record form the country of residence or origin. For any family dependents, the income amount is increased by 20% if there is a spouse/civil partner and by 15% for each child.
Tax Incentives for Investing in Innovative Companies/Startups
Tax exemption of 50% to new non domicile employees with employment remuneration of €55,000 and above for a period of 10 years, Tax exemption of 50% for existing non domicile employees with employment remuneration of €100,000 and above for an extended period of 17 years and Tax exemption of 50% for existing non domicile employees with employment remuneration between €55,000 & 100,000 for a period of 10 years.
Instead of 7 years, Highly Skilled Third Country employees who are residing and integrated into the Cypriot society, will be eligible to apply for Naturalization after 5 years of residence and work in the Republic. If the criterion of holding a recognized certificate of very good knowledge of the Greek language is met, a further reduction to 4 years will apply.
In addition, considering the nature of their work and the necessary absence abroad for business purposes, the law will provide a more flexible way of calculating their period of stay in the Republic.
The Strategy is a very important initiative towards attracting both international investments and talent. It includes a series of actions and reforms in several areas of intervention, aiming to enhance Cyprus position as an international high-growth business center.