Legal and Finance
Legal System
Up until 1960, Cyprus was a British colony. As such, the island’s legal system was almost entirely based on the English legal system, and the legislation adopted the principles of Common Law and Indulgence. Today, the legal system of the Republic of Cyprus still maintains the influence of the English legal system.
The laws applied by the Courts of the Republic of Cyprus are as follows:
The Constitution of the Republic of Cyprus
The laws maintained in force on the basis of Article 188 of the Constitution
The principles of the common law and the principles of impartiality
The laws established by the House of Representatives.
Following the accession of the Republic of Cyprus to the European Union in 2004, the Constitution of the Republic was amended in order to give European law greater power.
European Union accession
Following the accession of the Republic of Cyprus to the European Union in 2004, the Constitution of the Republic was amended in order to give European law greater power.
Taxation
The current tax system of Cyprus is fully compliant with both the EU and the OECD. It is considered by many to be one of the most attractive regimes in the EU and worldwide, due to having one of the lowest EU corporate tax rates at 12.5%, an extensive double tax treaty network, and relatively low income tax, limited capital gains tax, and no inheritance tax.
In addition, Cyprus offers:
Tax exemptions for gains from the disposal of securities
Corporation tax exemptions for profits earned from a permanent establishment abroad (under certain conditions)
Tax exemptions for dividend income received in Cyprus from a foreign corporation (under certain conditions)
No withholding tax on dividends and interest paid to non-residents of Cyprus, or on royalties arising from sources outside of Cyprus
Group relief provisions for companies resident in Cyprus.