The income tax laws in Cyprus follow very closely the principles of the English laws. Both companies and individuals are taxed under the Income Tax Law.
Tax is assessed in the year in which the income is earned or realised on a current year basis.
Income includes gains or profits from any trade, business, profession or vocation or from any office or employment including dividends, interest, rents, royalties and others. Offshore enterprises and their expatriate employees enjoy substantial tax advantages which derive from domestic Cypriot legislation and from Cyprus double tax treaties. In contrast to tax havens, Cyprus is a tax incentive country which offers benefits aimed at attracting non residents who wish to conduct their business from the island. The most important advantages are those relating to corporate and personal taxation. Dividends Dividends of foreign shareholders Shareholders of offshore companies are exempt from tax on dividend income.