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  • May 7, 2025
  • Connor Corporate Services Ltd
holding company cyprus

Register a Holding Company in Cyprus | Full Guide 2025

Cyprus has established itself as one of the most favourable jurisdictions in the European Union for the incorporation of holding companies. With its strategic geographic location, robust legal system based on English common law, full EU membership, and highly attractive tax regime, Cyprus continues to be a top choice for international investors and corporate groups seeking efficient and compliant structuring.

In this 2025 guide, we walk you through everything you need to know about registering a holding company in Cyprus—from legal requirements to tax benefits and compliance obligations.

What Is a Holding Company?

A holding company is a legal entity created primarily to own shares in other companies. It does not engage in active trading or service delivery but acts as a vehicle for asset protection, dividend receipt, consolidated ownership, and tax efficiency across jurisdictions.

Cyprus holding companies are typically used for:

  • Holding equity in foreign or domestic subsidiaries

  • Managing intellectual property and licensing income

  • Consolidating group ownership and investment portfolios

  • Facilitating tax-efficient repatriation of dividends

Key Advantages of a Cyprus Holding Company

1. Tax-Exempt Dividend Income

Dividends received by a Cyprus holding company from a foreign subsidiary are exempt from corporate tax, provided:

  • The paying company is not more than 50% passive-income derived, or

  • It is subject to tax of at least 6.25% in its country of residence.

2. No Withholding Tax on Outbound Dividends

Dividends paid to non-resident shareholders (non-domiciled in Cyprus) are not subject to withholding tax, even if paid to jurisdictions outside the EU.

3. Capital Gains Exemption

Profits from the disposal of shares in subsidiaries are generally exempt from capital gains tax, provided the underlying assets do not include Cyprus real estate.

4. Extensive Double Tax Treaty (DTT) Network

Cyprus has over 65 DTTs, enabling tax-efficient cross-border structuring and dividend flows.

5. EU Compliance & Substance

As an EU member, Cyprus structures meet EU substance requirements and are suitable for BEPS-compliant international tax planning.

Legal Requirements for Registering a Cyprus Holding Company

Legal Form:

Most holding companies are incorporated as Private Limited Companies (Ltd) under the Cyprus Companies Law, Cap. 113.

 

Minimum Requirements:

Requirement

Description

Shareholders

At least one (individual or corporate; local or foreign)

Directors

At least one; ideally a Cyprus tax resident for tax residency claim

Secretary

Mandatory; can be individual or corporate

Registered Office

Must be located in Cyprus

Share Capital

No minimum capital requirement (commonly €1,000 issued capital)

Step-by-Step Process for Incorporation in 2025

  1. Name Approval:

    Submit your desired company name to the Cyprus Registrar of Companies for approval.

  2. Preparation of Documents:

    Draft the Memorandum & Articles of Association, typically with a broad objects clause to permit holding activities.

  3. Company Registration:

    File all incorporation documents (HE1, HE2, HE3, and M&A) with the Registrar.

  4. Tax Registration:

    Obtain a Tax Identification Number (TIN) and register for corporate income tax and VAT (if applicable).

  5. Bank Account Opening:

    Open a corporate bank account (may require detailed KYC, proof of substance, and business justification).

  6. Substance Setup (Recommended):

    For tax residency and substance purposes, consider:

    • Appointing local directors

    • Renting office space

    • Maintaining local accounting and administrative services

Ongoing Compliance Obligations

  • Annual Return Filing (HE32)

    Must be filed with the Registrar of Companies each year, including updated details on shareholders and directors.

  • Annual Financial Statements

    Must be audited and submitted to the Cyprus Tax Department.

  • Tax Returns

    Annual corporate income tax returns (TD4) must be filed electronically.

  • UBO Register

    Submit and update Ultimate Beneficial Owner information in the UBO Register, as required by AML compliance.

Is a Cyprus Holding Company Right for You?

You should consider a Cyprus holding structure if:

  • You operate a multinational group or investment portfolio

  • You need to consolidate ownership in a low-tax, EU-compliant jurisdiction

  • You want to legally optimise dividend repatriation and capital gains

  • You seek asset protection with access to EU and international legal standards

How Connor Corporate Services Ltd Can Help

At Connor Corporate Services Ltd, we offer end-to-end incorporation, compliance, and ongoing administration services for Cyprus holding companies. Our legal and corporate advisors provide:

  • Name clearance and registration

  • Customised M&A drafting

  • Tax structuring advice

  • Director and secretary appointments

  • Substance and bank account setup

  • Ongoing accounting and legal compliance

    Get in touch today to book a consultation or request a custom quotation for your holding company setup in Cyprus.

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