The Cyprus Government, in order to encourage foreign investments, offers Investment Programs with which investors may acquire permanent residence permits or the citizenship of the Republic of Cyprus.
These programs have been particularly popular for a number of reasons:
- The unstable political environment in certain countries.
- The extremely favorable tax regime in Cyprus.
- The status of Cyprus as a full member of the EU and the Eurozone.
- The exceptional infrastructure which has established Cyprus as a reputable financial centre.
- Cyprus provides an excellent place to work and live due to its safe environment and ideal climate.
According to these programs, foreign citizens, together with their spouses, children and parents, may obtain:
- Permanent Residence Permit (certain conditions apply including, but not limited to, the obligation to purchase a residential property of a minimum value of €300,000).
- The Citizenship of Cyprus (certain conditions apply including, but not limited to, the obligation to invest in Cyprus a minimum of €2,000,000).
Cyprus is the third largest island in the Mediterranean and is strategically located between three continents, Asia, Europe and Africa.
It is a member state of the European Union, a member of the Eurozone and it offers a solid legal system and a favorable tax regime which, over the years, established it as a popular and reputable international business center.
With its long history, excellent infrastructure, safe environment and ideal climate with almost year-round sunshine, Cyprus offers an excellent place to work and live.
BENEFITS OF CYPRUS CITIZENSHIP
- VISA-free or stamp on arrival travel to over 165 countries.
- Freedom to live and work in any EU member state, Switzerland, Norway, Iceland and Liechtenstein.
- Citizenship can be passed on by descent, therefore, ensuring that future generations can also be Cyprus citizens.
- Tax benefits, such as, no inheritance tax and an extremely favorable tax regime for non-domiciled tax residents.
CYPRUS INVESTMENT PROGRAMME
One of the main objectives of the economic policy of the Republic of Cyprus is to encourage foreign direct investments and to attract high net worth individuals to settle and conduct their business in Cyprus. For this purpose, The Cyprus Investment Program offers incentives to non-Cypriot citizens to invest in Cyprus and to apply for the acquisition of the Cypriot citizenship.
- The investment can be as low as €2,0 million and it should be retained for a period of at least five years except a permanent residence in Cyprus worth at least €500,000 which should be kept indefinitely
- Citizenship is also granted to the spouse or partner of the main investor and their financially dependent children (minor and, under certain conditions, adult children).
- The main applicant’s parents are also entitled to receive Cyprus Citizenship provided that they own a permanent residence in Cyprus of at least €500,000 or they jointly own with the main applicant a residence of at least €1,000,000.
- There are no language proficiency requirements.
- Dual-citizenship is permitted and the acquisition of citizenship in Cyprus is not reported to other countries.
- Low government fees and donation requirements.
- An extensive choice of investment alternatives.
INVESTMENT OPTIONS, TERMS AND CONDITIONS
1. Main Investment
The main applicant should invest at least €2,0 million (plus VAT if applicable) in one of the following:
(a) Real Estate – This option includes the purchase or construction of buildings and the construction of other land development projects, such as, residential or commercial developments and developments in the tourism sector.
(b) Participation in Cypriot Businesses or Companies – This option includes the purchase, establishment or participation in companies or businesses which are established and operating in Cyprus. The invested funds should be used exclusively in Cyprus according to the specific investment plan that the company should have. Such organizations should have physical presence in Cyprus, substantial activity and turnover, and they should employ at least 5 Cypriot or EU citizens.
(c) Investment in Funds or in Financial -For the purposes of the program, qualifying funds (AIF or RAIF) should be based in Cyprus and regulated by the Cyprus Securities and Exchange Commission. Furthermore, they should exclusively invest their funds in Cyprus in fields which are allowable under the present investment program or in any other field approved by the Minister of Finance.Qualifying financial assets, such as bonds and securities, should be issued by companies which are regulated by the Cyprus Securities and Exchange Commission and have physical presence and substantial economic activity in Cyprus. Furthermore, the funds raised from such assets should be used exclusively for investments in Cyprus according to the specific investment plan that the company should have.
(d) Combination of the above mentioned options– Under this option, the investment can be made in any combination of options a, b or c above.
2. Residence in Cyprus
The main applicant should own a permanent residence in Cyprus of a minimum value of €500,000. The permanent residence can be one of the properties purchased under option 1(a) above (Real Estate) provided that the main investment is exclusively in residential properties which have not already been used for the purpose of acquiring the Cypriot citizenship and provided that one of the properties purchased is of a minimum value of €500,000 plus VAT. In all other cases, investors should also purchase a permanent residence of a minimum value of €500,000 in addition to the €2,0 million main investment of paragraph (1) above. If the permanent residence is worth more than €500,000 then the difference can count towards the €2,0 million main investment requirement.
3. Donation to the Research and Innovation Foundation and the Cyprus Land Development Corporation
(a) The main applicant must have donated at least €75.000 to the Research and Innovation Foundation.
This obligation is lifted in the following cases: (1) if the applicant invests at least €75.000 in a certified (by the Ministry of Finance) innovative enterprise or a certified social enterprise or (2) if the applicant invests under the option 1(b) above (Participation in Cypriot Companies or Businesses) at least €400.000 in a company whose operations fall within the primary sector of the economy, or the secondary sector of the economy (excluding construction), or in the sectors of research and development, education, health and renewable energy sources.
(b) The main applicant must have donated at least €75.000 to the Cyprus Land Development Corporation for the financing of housing schemes for affordable housing.
4. Due Diligence
Applicants must have clean criminal records, should not be subject to European Union sanctions, should have not been rejected for citizenship in any other member-state and should hold a valid Schengen visa. Third-Country nationals that do not require an entry visa for travelling in European Union member-states and citizens of European Union Member States are excluded from the Schengen visa obligation.
5. Residence Permit in Cyprus
Applicants must hold a Cyprus residence permit for at least 6 months. For this purpose, an application for a residence permit can be submitted simultaneously with the Citizenship application.
6. Period of investment
Investments should be retained for at least five years with the exception of the permanent residence that should be kept indefinitely. During the said five-year period, the original investments can be replaced with other investments (subject to the approval of the Ministry of Finance). The permanent residence can be replaced at any time with another property of an equal or greater value.
The procedure for the acquisition of the Cypriot citizenship is, in most cases, completed within 3 months, provided that the applicant holds a residence permit for a period of at least 6 months.
Cyprus is one of the fastest growing economies in the European Union. With strong fiscal performance, it has exceeded international expectations and kept steady pace in improving efficiency, implementing reforms and boosting investor confidence. Following the discovery of natural gas reserves with the involvement of major Oil and Gas companies, such as, ExxonMobil and Total, energy will undoubtedly become a significant new source of growth.
Due to the small size of the island, and therefore the limited supply of land, the economic growth will undoubtedly have a significant impact on real estate, perhaps bigger than on any other sector of the economy. As a result, the sector has already attracted substantial foreign investments, such as, the €550 million City of Dreams Casino Resort and the €220 million Ayia Napa Marina.
Additionally, past experience has shown that large-scale projects attract further investments and have a substantial impact on property prices in the surrounding area. Therefore, with many new large-scale projects in the pipeline and limited supply of land, Cyprus offers investment opportunities in the real estate sector with potentially high returns.
Please also note that:
- Investing exclusively in residential property limits the total investment to €2,0 million, whereas in all other cases, an additional permanent residence should be purchased which increases the total investment to €2,5 million.
- New properties are subject to 5% VAT in the case of permanent residence (certain conditions apply) and 19% in all other cases. Therefore, making a single investment in a residential property of at least €2,0 million can benefit from the reduced VAT rate.
- There are no transfer fees for properties which are subject to VAT and in all other cases a 50% reduction applies.
- There is no inheritance tax.
- Rental income is SDC tax exempt for non domiciled individuals.
- Main applicant: €7,000
- Spouse: €7,000
- Parents: €7,000
- Dependent child up to 18 years of age: €80
- Dependent child between 18 and 28 years of age: €7,000
Cyprus citizens are not required to have an entry visa for the following countries:
Albania, Andorra, Argentina, Austria, Barbados, Belgium, Belize, Bolivia, Bosnia & Herzegovina, Brunei Darussalam, Bulgaria, Canada, Central African Republic, Chile, Colombia, Costa Rica, Croatia, Czech Republic, Denmark, El Salvador, Estonia, Finland, France, FYR of Macedonia, Gambia, Germany, Greece, Grenada, Guatemala, Hungary, Iceland, Ireland, Israel, Italy, Jamaica, Japan, Korea Republic of (South), Latvia, Lesotho, Liechtenstein, Lithuania, Luxembourg, Malawi, Malaysia, Maldives, Malta, Mauritius, Mexico, Moldova, Monaco, Montenegro, Morocco, Netherlands, New Zealand, Nicaragua, Norway, Panama, Paraguay, Peru, Philippines, Poland, Portugal, Romania, San Marino, Saint Lucia, Serbia, Seychelles, Singapore, Slovak Republic, Slovenia, South Africa, Spain, Swaziland, Sweden, Switzerland, Trinidad and Tobago, Ukraine, United Kingdom, Uruguay, Vanuatu, Zambia.
Visa is also not required for the non UN Members / Territories of Hong Kong S.A.R, Macao S.A.R and the Vatican City.
Additionally, Cyprus citizens can quickly and cost-effectively obtain visas for other countries, such as the USA and Australia.
For more information and inquiries please contact us