Corporate Structuring
Cyprus Holding Company
Holding structures using the participation exemption and Cyprus treaty network.
What we do
We build and run Cyprus holding companies. Dividends arriving from qualifying subsidiaries are exempt, gains on the disposal of securities sit outside the corporate charge, and distributions out to non-resident shareholders carry no Cyprus withholding tax.
Those three reliefs are the reason the structure exists, and all three rest on the company being Cyprus tax resident, which follows from where it is directed rather than from where it was registered. We provide the board and the record that support that, which is the part most groups underestimate.
What you get
- The holding entity structured against the subsidiaries you have and the ones you intend
- Incorporation, registered office and the statutory registers
- Cyprus resident directors with real authority over the company's decisions, where you want the board to sit here
- A board calendar, with papers and minutes recording acquisitions, disposals, distributions and lending
- Participation exemption analysis for each subsidiary, tested against both anti-avoidance conditions
- Treaty and directive relief reviewed on inbound dividends, interest and royalties
- Support where subsidiaries are being moved beneath the holding company
- Audited accounts and the annual filing cycle
How it works
The participation exemption is not claimed, it applies. It is lost only where two conditions are met together: the subsidiary is more than half engaged in activities producing investment income, and the foreign tax on the profit being distributed is below the threshold, which is 7.5 percent from 2026. An active subsidiary in a low tax jurisdiction keeps the exemption. A passive one in a normally taxed jurisdiction keeps it too. We test both conditions per subsidiary rather than once for the group.
The securities exemption is simpler. Gains on the disposal of securities are outside the Cyprus corporate charge whether the holding was for one year or ten, and for a group expecting to sell subsidiaries that is often worth more than the dividend position.
What makes both durable is a board that meets here, considers the transactions and records what it considered.
Working with us
Four steps, and the first one is a conversation
A call
What the group owns, where the subsidiaries are, and where the money is meant to end up. No charge for it.
A proposal in writing
Fixed fees, not estimates: what year one costs, and what every year after it costs.
You accept
Engagement letter signed, then onboarding. Neither takes long.
The structure is in place
Company formed, board appointed and the first meetings held, so the record supporting the position starts on day one rather than being assembled later.
Common questions
What does a Cyprus holding company actually save?
Three things. Dividends from qualifying subsidiaries arrive exempt, gains on disposals of securities are outside the corporate charge, and distributions to non-resident shareholders carry no Cyprus withholding tax. Which of the three matters most depends on whether the group is holding for income or building towards a sale.
Do the directors have to be in Cyprus?
The reliefs depend on the company being Cyprus tax resident, and residency follows management and control. A resident board that meets, considers and minutes supports that. A resident board that receives documents for signature does not, and the difference is visible in the records years later.
Can we move existing subsidiaries under a new Cyprus holding company?
Usually, and how it is done matters more than whether it can be. A share for share exchange, a contribution in kind and an outright transfer have different consequences in the jurisdictions the subsidiaries sit in, which is a question for advisers there as well as here.
What follows
A holding company files the same returns as any other company, and we do that work for you: corporate administration for the registers and filings, accounting and tax compliance for the accounts and returns.
Where the group's substance needs to be more than a board, economic substance is what carries it.
| Foreign dividends received | Exempt under the participation exemption in most cases |
|---|---|
| Gains on disposal of shares | Outside Cyprus tax, unless at least 20 percent of asset value is Cyprus property |
| Withholding on dividends to non-residents | Nil in the ordinary case, 5 percent to low-taxed and 17 percent to blacklisted jurisdictions |
| EU directive access | Parent-Subsidiary and Interest and Royalties Directives |
| Condition for all of it | The company must be Cyprus tax resident on management and control |
| Exposure if residency fails | All four reliefs are lost at the same time |
Also in Corporate Structuring
- Cyprus Company FormationExpedited incorporation with every mandatory registration, and the Registrar and government fees included in one fee.
- Company RedomiciliationTransfer of an existing foreign company into Cyprus without breaking legal continuity.
- Economic SubstanceManagement and control, governance and the evidence file that supports tax residency.
- International Tax PlanningCross-border structuring against ATAD, Pillar Two and treaty tie-breaker rules.
Find out whether Cyprus fits your plans
It starts with three questions: where your revenue comes from, what you own, and where you are tax resident. From there, the conversation is about what you are building and where you want to take it. After the call, you receive a written proposal covering the recommended structure, the implementation roadmap, and a fixed fee quote.