1.BUSINESS FACILITATION UNIT Transformation of the existing Fast Track Business Activation Mechanism into a Business Facilitation Unit for facilitating companies that are active or wish to be active in Cyprus  Main Responsibilities

• Provision of Services for setting up businesses:
• Company registration, name approval
• Registration in the Social Insurance Register
• Registration in the Tax/VAT Register
• Guidance/information on the necessary licenses to operate in Cyprus
• Accelerate the issuance and renewal of residence and employment permits

√ Central Contact Point for business – direct and streamlined assistance √ Digitization of procedures √ Online Platform The “Business Facilitation Unit (BFU)” operates under the auspices of the Ministry of Energy, Commerce and Industry as of the 1st of January 2022. The Unit is the single point of contact for foreign companies wishing to commence or expand their operations in Cyprus. The purpose of the new unit will be the fast and efficient processing of such requests. Among other services, the Unit provides the ability to complete all registrations for the establishment of a business at its own One-Stop Shop section. What is more, we guide you through the necessary permits for the establishment and operation of your envisaged business and register eligible organisations in the Register of Companies of Foreign Interests; now kept and maintain by the Unit.

For more information please visit our website at: https://www.businessincyprus.gov.cy/business-facilitation-unit/ 

2. New policy for the employment of third Country nationals Review, broadening and simplification of existing policy

• Eligible Companies:

1. Foreign companies/undertakings operating in the Republic of Cyprus or foreign companies/undertakings intending to operate        in the Republic of Cyprus, that operate independent offices in Cyprus, housed in appropriate independent offices, separate              from residences or other offices
2. Cypriot shipping companies
3. Cypriot high-tech/ innovative companies
4. Cypriot pharmaceutical companies or companies active in the sectors of biogenetics and biotechnology

•  Criteria

1.     Minimum gross monthly salary of at least €2,500
2.     University diploma or degree or equivalent qualification or confirmation of relevant experience in a corresponding job of at              least 2 years duration.
3.     Employment contract of not less than two years duration. 

            Duration of residence and employment permits: Up to 3 years              Issuance of residence and employment permits: Within 1 month             Number of employees allowed             Maximum number of third-country nationals is set at 70% of all employees over a period of 5 years, from the date of joining the                          Business Facilitation Unit. Re-assessment after 5 years, on a case by case basis, if criterion of 30% Cypriot employees is not met.

• Employment of support staff (with gross salary < €2500)
• Employment of third-country nationals is permitted, provided that it does not exceed 30% of all support staff and provided that      the third-country national and the employer have entered into an employment contract duly ratified by the competent                    authority in accordance with the existing applicable law.
• The salary level is determined on the basis of the existing applicable legislation.
• Duration of residence and employment permits: Up to 3 years

  3. Right to family reunification of third-country nationals included in third-country employment policy Immediate and free access to the labor market for spouses whose financial supporter has obtained a residence and work permit in the Republic, and who receive a minimum gross monthly salary of € 2,500 (excluding support staff).   4. Simplify and speed up the process of Granting Category E work permit (Long Term Resident Status)    5. Introduction of a DIGITAL NOMAD VISA  (Initial max 100 beneficiaries)

• Beneficiaries

Third-country nationals that are self-employed or salaried employees, working remotely with employers / clients outside Cyprus, through the use of information and communication technologies.

• Residence Status
• They have the right to stay in Cyprus for up to one year, with the right to renew for another two years
• They can be accompanied by their family members, who are granted, upon request, a residence permit that expires at the same time as that of the financial supporter. During the stay in Cyprus, the spouse or partner and the minor members of the family of the financial supporter are not allowed to engage in any form of economic activity in the country
• If they reside in Cyprus for one or more periods totaling more than 183 days within the same tax year, they are considered tax residents of Cyprus, provided that they are not tax residents in any other Country.

 Main preconditions

• Evidence that he/she has sufficient funds – a stable income to cover living expenses during the stay in the country, without recourse to the national social welfare system. The amount of sufficient funds is set at three and a half thousand (3.500) euros per month and can be proven by: 

1. The employment or works contract or proof of employment, in the case of dependent work, services or works or
2.  A bank account. If sufficient funds come from paid employment services, services or works, the above minimum amount refers to net income after payment of the required taxes in the country of employment.

The above amount is increased by twenty percent (20%) for the spouse/partner and by fifteen percent (15%) for each child.  

• Medical Insurance

• Clear criminal record from the country of residence

  6.BROADENING TAX INCENTIVES FOR EMPLOYEES

• Tax exemption of 50% to new non domicile employees with employment remuneration of €55,000 and above – period 10 years
• Tax exemption of 50% for existing non domicile employees with employment remuneration of €100,000 and above – extended period 17 years.
• Tax exemption of 50% for existing non domicile employees with employment remuneration between €55,000 & 100,000 – period 10 years.

 7. Tax exemption extension for investments in innovative companies Examine the possibility of extending the 50% tax exemption for investment in certified innovative companies to corporate investors.  8.Increased (compared to the real) tax deduction for research and development expenditure Granting an increased discount on research and development expenditure (e.g. by 20%). Eligible research and development expenses will be deducted from taxable income at 120% of actual expenses. 9.Naturalization  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 the criterion of holding a recognized certificate of very good knowledge of the Greek language is met.

  10.Promotion Actions 

• Promotion/Awareness Campaign of the Strategy abroad
• Information campaign to attract qualified Cypriots working abroad as well as foreign talent

Note: The Strategy is in implementation as of 1.1.2022 excluding action 6 – 9 for which Parliamentary amendments are required. The Bills will be submitted in Parliament by the end of December 2021 for vetting in Q1 of 2022.  Link: http://mof.gov.cy/en/strategy-for-attracting-businesses/strategy