ATTRACTING COMPANIES TO CYPRUS: WORK PERMITS FOR NON-EU ATIONALS
EMPLOYMENT OF NON-EU NATIONALS IN INTERNATIONAL COMPANIES IN CYPRUS
A Cyprus company that is controlled by Non-EU nationals can apply for Cyprus work permits for Non-EU Nationals permitting them and their families to work and live in Cyprus. In such cases, a temporary residence and employment permit is necessary.
The Council of Ministers approved on October 15th, 2021 the “Strategy for Attracting Businesses for Activities or/and Expansion of their Activities in Cyprus”.
The Strategy is a very important initiative towards attracting both international investments and talent and aiming to enhance Cyprus’ position as an international high-growth business center.
The careful and thorough planning ensures that the benefits derived from the successful implementation of the Strategy will significantly contribute to redefining the Cyprus growth model.
Companies of foreign interest must meet the following criteria in order to be eligible to employ Non-EU nationals in Cyprus:
− The majority of the company’s shares are owned by third-country nationals. It is noted that in the event that the percentage of the foreign participation in the share capital of the Company is equal to or below 50% of the total share capital, the Company is eligible when this percentage of the share capital represents an amount equal to or greater than the amount of €200,000.
− Public companies registered on any recognised stock exchange.
− Companies of international activities (formerly off-shore), which operated before the change of regime, whose data are held by the Central Bank.
− Cypriot shipping companies.
− Cypriot high-tech/innovation companies. An enterprise qualifies as ‘High Technology Company’ if:
- it is already established and has a presence in the market, and
- it has a high level or experimental R&D intensity, and
- it developed product(s) that fall into one of the following categories: products related to aviation and space industry, computers, electronic and telecommunication products, pharmaceuticals, biomedical, research and development equipment, electrical machinery, chemicals, non-electrical machinery.
− Cypriot pharmaceutical companies or Cypriot companies active in the fields of biogenetics and biotechnology.
− Companies of whom the majority of the total share capital is owned by persons who have acquired Cypriot citizenship by naturalization based on economic criteria, provided that they prove that the conditions under which they were naturalized continue to be met.
Companies satisfying any of the above criteria need to:
- Establish and operate independent offices in Cyprus, in suitable premises, separate from any private housing or other office except in the case of business co-habitation is necessary.
- If a company is not new, the audited Financial Statements, tax clearance and proof of payment of the annual levy to the Registrar of Companies need to be submitted together with the application.
- Minimum gross monthly salary €2,500.
- Holding of a university diploma or degree or equivalent qualifications or certificate/verification of relevant experience in a corresponding employment position of at least two years.
- Presentation of an employment contract for a minimum of two years.
The duration of residence and employment permits could be for up to three years.
The issue of the residence and employment permits will be made within 1 month.
The maximum number of third-country nationals eligible for employment is set at 70% of all employees in a period of 5 years, from the date of the approval. In case the company did not employ the 30% Cypriot workers, the Cyprus Government will review each case independently at the end of the 5th year and decide accordingly.
Direct and free access to the Cyprus labour market with paid work, to spouses whose spouse has obtained a residence and work permit in Cyprus, and who receives a minimum gross monthly salary of €2,500.
The Minister of Finance has announced the intention of the government to introduce the following incentives:
- Tax exemption of 50% to new residents-employees with annual remuneration exceeding €55,000.
- Existing employees with earnings of less than € 100K have the possibility to extend the benefit from 10 to 17 years. Potential beneficiaries are also individuals with annual remuneration between €55,000 and €100,000 for the remaining a period of 17 years.
- Possibility of extending the 50% tax exemption for investment in certified innovative companies by corporate investors.
- Possibility of an increased deduction on research and development costs (e.g. by 20%). Eligible research and development costs will be deducted from taxable income at 120% of actual.
Right to apply for naturalization:
- After 5 years of residence and work in the Republic, instead of 7 that is valid today.
- Further reduction to 4 years if they meet the criterion of holding a recognized certificate of very good knowledge of the Greek language
By: George Kallinicou