International business companies or Offshore Companies are registered in accordance to the Company requirements set out by Cap 113 – Companies Law as well as the 38/2005 International Business Company Law that is in compliance to the European Union legislation. They must carry out their business transactions outside of the TRNC, and their Memorandum and Articles of Association prohibits them from doing otherwise. Foreign natural persons, foreign legal entities, and TRNC citizens living abroad can apply to establish an International Business Company in TRNC. The Council of Ministers has the sole authority to approve foreign branches. North Cyprus International Business Companies encourage international business, attracting investors from all over the world in fields ranging from; Travel Agency, Aviation Services, Finance, Consulting, IT, Online Services and Telecommunication. International Business Companies benefit from preferential tax and customs rates - those which are registered in the TRNC and carrying on in business outside the TRNC are subject to 1% Corporation Tax on their net taxable profits and are exempt from income tax and value-added tax (VAT) on their sales and trade activities. Moreover, there is no withholding tax on dividends paid and no restriction on movement of capital to and from the Company. They should deduct the tax amounts from the wages of employees. International Business Companies are not subject to any other taxes, and are only responsible for paying income tax (PAYE), social insurance and provident fund contribution of their employees. Furthermore, there are no visits required to the TRNC.
There is also the benefit of strict confidentiality - shareholders, directors and secretaries must not be listed in the public register. An extra layer of confidentiality can be found when corporate nominee shareholders, nominee directors and secretaries are used. The fees required for setting up an International Business Company in Northern Cyprus are in accordance to Cap 113 – Companies Law.
Please do not hesitate to contact our office should you require any further details.
This article is intended for general information purposes only and does not constitute legal or professional advice. BHLEX Law and Consultancy Bureau does not accept liability for any loss which a person may incur as a result of relying on or otherwise using this information.