The cost of registering a Cyprus company is the first question that potential clients ask.
Here we have compiled a “what to look for guide,” so that you know what to look for when choosing a law firm or company provider for your new company.
There are 4 kinds of fees involved when setting up a Cyprus company:
- The registration or set up fee
- The annual fees
- The accounting/auditing fee
- The annual expenses payable to the Registrar of Companies
1. The registration or set up fee
This is the fee that you pay to create the company. It is paid only once.
You can find Cyprus companies from €1200 to €3000. The price depends on the service provider. Big law firms usually price their companies from €4000, whereas one man law firms offer less than half the price.
There are two caveats however.
The first is “after sale service” i.e. whether the provider will be able to cater to your needs after the company is set up.
The second is what is included in the price. Many service providers offer Cyprus companies at prices as low as €500 but then charge additional fees in order to provide the basic company documents that an owner will need.
2. The annual fees
Annual fees include the fees for the services of nominees, secretary and registered office.
Nominee services are divided into:
- Nominee shareholders and
- Nominee directors
Nominees are usually lawyers or accountants and are used in order to ensure the anonymity of the client. To read more about anonymity click here.
In addition, a company has to designate a registered office in Cyprus and have a secretary.
The registered office is usually the address of the office or the lawyer that incorporates the company. For example, the companies registered by Christophi & Associates LLC have the address at 20, Spyrou Kyprianou Avenue, CHAPO CENTRAL,2nd floor, office 201, 1075 Nicosia, Cyprus. Of course, it does not have to be the address of your lawyer but it has to be a physical address in Cyprus.
Finally, a Cyprus company must have a secretary which is usually the lawyer that incorporates the company. This is done for convenience reasons since the lawyer, in capacity of a secretary, can prepare and sign any forms or applications for the Registrar of Companies without having to disturb the client every time.
So, annual fees may have to be paid for 4 services (nominee shareholders, directors, secretary and registered office) depending on the requirements of the client.
3. The accounting/auditing fees
Accounting and auditing fees vary. They depend on:
- the number of transactions the company executes each month/year
- if your accountant is a small accounting firm or one of the big firms like PWC, KPMG etc.
A Cyprus company needs to register with the Inland Revenue Office and get a tax number. From then on it has to file audited accounts every year and pay tax, if appropriate.
Some companies are also registered with the VAT Department and get a VAT number. In such case, they have to file VAT return every three months.
Accounting / auditing fees range start from €1200 plus VAT per year and increase depending on the requirements of each company.
4. The annual expenses payable to the Registrar of Companies
4.1 Annual Return
Each year a company has to file an annual return (annual report) with the Registrar of Companies. This report records the changes that took place in the company during the year, e.g. changes in shareholders, capital, directors etc.
The stamp cost is around €100. From there on it is a matter of what the lawyer or accountant will charge for preparing and filing the report.
4.2 Special Government Levy
All Cyprus companies must be a special government levy of €350 by the 30th of June each year.
In the case of group companies the total sum payable is capped at €20,000. This amount should be equally divided between the companies.
For late submissions, within 2 months, there is a penalty of 10%, and for late submissions but within 5 months, 30%.
If a company does not pay its annual levy within these time frames then the Registrar of Companies may proceed with the strike off of the Company in accordance with article 327 of the Companies Law.
In the event that the strike-off procedure has been exercised and the company wishes to be reinstated then it should pay €500 within 2 years from the date of the removal of the name of the company from the register kept by the Registrar of Companies. After the 2-year period, the fee for reinstating the company will be €750.
Companies undergoing liquidation and considering that the liquidation has been initiated prior the 30th of June (evidenced by the appointment of the Liquidator), have no obligation to pay the annual levy.
If you want to open a bank account, or need power of attorney then this involves additional fees. You should make sure that these are agreed separately.