Cyprus is becoming a popular place for Israelis to purchase property because of its close proximity to Israel, affordable living expenses and prime location to draw Israeli companies looking to expand into Cyprus.
In the summer of 2023, there were signs that the business community in Israel was becoming so alarmed by the proposed judicial makeover that about 70% of startups were moving portions of their operations outside of Israel, according to a significant study. Since then, the war has broken out.
The war may have contributed to an increase in interest from Israeli businesses seeking to move their headquarters to Cyprus, which is nearby and provides many advantages for Israeli businesses, including a tax system that is advantageous. In contrast to Israel, it is also far simpler to hire foreign workers in Cyprus [from third-world non-EU nations] as software engineers, for example.
It is noteworthy that Israel has earned the moniker “the Startup Nation” due to its thriving startup scene. On a much smaller scale, Cyprus is home to a fair number of startups and has established itself as a centre for technical innovation by serving as a welcoming environment for these businesses.
Many companies are thinking about moving in order to protect their workers and maintain operations in the face of the growing tension in Israel.
With its close proximity, strong economic connections, and conducive business climate, Cyprus presents itself as a viable and strategic option for Israeli enterprises.
How to Move Your Business to Cyprus
The process of relocating your company to Cyprus is quite simple and consists of four main steps:
- Company Registration: Cyprus investment authorities have developed a quick mechanism for the companies and their employees to relocate and be registered in Cyprus through a one-stop-shop Business Facilitation Unit (BFU).
- Bank Account Opening: You will receive instructions on how to effectively set up a bank account, which is crucial for your financial activities.
- Residence Permit Registration: To lawfully remain and do business in Cyprus, owners, management, and staff must register their residence permits.
- Team Relocation and Adaptation: After you finish the preparatory procedures, your team’s relocation and subsequent adaptation come into focus.
Advantages of moving to Cyprus
- Tax Advantages: Cyprus is a unique commercial destination, particularly for Israeli companies, for the following reasons:
- Intellectual property-holding IT organizations can benefit from an effective rate as low as 2.5%.
- 5% corporate tax rate.
- With no dividend tax, it is profitable for stockholders.
- personal income tax rates vary from 0% to 35% depending on certain factors.
- Capital gains and share sales are both tax-free at zero percent.
2. Possibility to obtain an EU Passport: Relocating to Cyprus also presents the prospect of gaining Cypriot citizenship, which entitles one to an EU passport after four years of residency.
3. Cyprus Life: Beyond Business-as-Usual Business Security: Businesses can operate in Cyprus with little interference from the government because of the non-interventionist policy and limited state regulation that the government upholds.
4. Active IT Communities: CypRus IT, IT Hub, TechIsland and Founders CY are just a few of the vibrant IT communities that are sure to impress any IT organization. These forums are great places to network and encourage creativity and teamwork.
5. Safety and security: Cyprus has a low crime rate and is ranked 30th out of 129 states in the world for safety, making it a secure place for both individuals and businesses.
6. Comfy Living: Cyprus offers an unrivalled work-life balance with its 350 sunny days a year and close proximity to the stunning beaches of the Mediterranean.
Cyprus provides a promising, safe, and business-friendly environment for Israeli people and enterprises looking to start over amid the current unrest.
We at S. Dionysiou & Partners LLC advise on various matters related to business or private immigration. For any further assistance, you may contact us at info@dplawcyprus.com.
This content is solely for general information purposes. None of the information herein should be relied on or substituted for specific professional advice regarding a particular matter or situation and no person should act or refrain from acting on the basis of the information contained in this brochure without first obtaining advice from an attorney.
We are not engaged in rendering legal services or advice by providing the information contained in this brochure.
