Popular holiday destination or major international financial centre? Both, says Harris Makriyiannis. The Managing Director of Leo Trust Cyprus talks also about services, products, the future – and eco-label awarded beaches.
How long have clients been able to count on the expertise of Leo Trust Cyprus?
Harris Makriyiannis: Leo Trust has been offering quality service for eight years, through its Cyprus subsidiary.
Speaking of quality service, what does Leo Trust Cyprus offer?
We offer a wide spectrum of fiduciary and corporate services inclusive of multi-jurisdictional company structure set-up, trustee services, accounting services, company restructuring and together as Leo Group, we offer asset management, wealth management and estate management.
From services to products - Harris, please describe the following products.
a) Cyprus Permanent Residence By Investment
The Cyprus Permanent Residence Permit (PRP) program is geared towards non-EU nationals that want to become Cyprus residents. The applicant must invest at least €300,000 in one of the following investment categories: In a house or apartment, in other types of real estate: e.g. offices, shops or a combination of real-estate developments, investment in a local company with business activities with substance in Cyprus or investment in a Cyprus based fund.
PRP approval by the authorities is typically 3-5 months after filing (depending on application backlog). Once approved, there is no need for renewal and it covers, spouses and children up to 18 years of age.
b) Becoming A Cyprus Tax Resident
First time tax residents as well as returning ex-patriots benefit from an exemption on income tax for overseas employment, 50% exemption on income tax on remuneration for any employment exercised in Cyprus for a 10 year period, provided this income exceeds EUR 100,000 per annum (20% exemption if less than EUR 100,000 per annum), no tax on dividends, interest or gains on the disposal of investments and an exemption from capital gains tax on the sale of real estate. Furthermore, there is no estate duty, wealth tax gift tax or inheritance tax in Cyprus.
There are two ways to become a Cyprus tax resident:
183 days rule
A physical presence in Cyprus exceeding 183 days in a tax year (1st January to 31st December) will constitute tax residency for an individual. Therefore, if an individual is physically present in Cyprus for more than 183 days in a tax year, they will be considered a tax resident of Cyprus in that tax year.
60 days rule
An individual who does not stay in any other country, for one or more period(-s) exceeding in aggregate 183 days in the same tax year and is not tax resident in any other country for the same year, is deemed as a resident in Cyprus in that tax year – if the following conditions are all met:
The individual stays in Cyprus for at least 60 days in the tax year, exercises a business and/or is employed in Cyprus and/or holds an office with a Cyprus tax resident company at any time during the tax year, maintains (by owning or leasing) a permanent home in Cyprus.
c) Intellectual Property
Cyprus offers an extremely efficient Intellectual Property (IP) tax regime. 80% of worldwide royalty income qualified from IP owned Cyprus resident companies is exempt from income tax. The remaining 20% will then be subject to the standard corporate tax rate of 12.5%, to give an effective tax rate of 2.5% or less.
Research and Development (R&D) either in Cyprus or through a branch of the Cyprus legal entity in another jurisdiction is required for the Cyprus legal entity to benefit from the reduced tax. Eligible forms of IP include: Copyrights, inclusive of iterary work, dramatics works, computer software and applications, scientific work, databases, recordings, trademarks, publications, art, patents and inventions, broadcasts and film and patented inventions.
d) Cyprus Securities and Exchange Commission (CySEC), Crypto Asset Services Provider (CASP)
Following the transposition of the Anti-Money Laundering Directive V (AMLD V) into Cyprus law, on the 25th June 2021, CySEC announced that it would begin to accept Crypto-Asset Service Provider (CASP) license applications, making Cyprus one of the first countries within the EU to allow this. There are three different categories of licenses which allow the CASP license holder to offer different services from just investment advice to portfolio management and custodianship of crypto currencies for clients.
Together with our expert associates, we undertake to design the CASP structure, prepare the application inclusive of the required business plan, internal operations, AML manuals and submitting and follow-up with the regulator.
e) Cyprus Digital Nomad Visa Scheme
The scheme allows third-country nationals, from non-EU and non-EEA countries, to work location-independently and at the same time permitting them to reside with their families in Cyprus and work for an employer registered abroad or perform work as a self-employed individual providing services to companies or clients situated abroad
f) Cyprus International Trust
The formation of a Cyprus International Trust (CIT) provides for a high level of confidentiality, but also a very high threshold of asset protection. The assets settled into the trust are sheltered against potential claims. Assets are also sheltered against subsequent bankruptcy or liquidation of the settlor, or creditor’s action against the settlor – irrespective of whether the trust was set up without consideration or to the benefit of the settlor or his/her family – unless it can be proven that the CIT was set up with intention of the settlor to defraud his creditors.
It is worth noting that the trust property can include all types of assets, movable or immovable, situated anywhere in the world, provided that the trustee has legal control and ownership of the assets.
In terms of anonymity, at the companies registrar level, only the trustee is registered. There is a requirement for the trust, its settlor, trustee, protector, enforcer and beneficiaries to be registered through CySEC’s trust registry. This registry is not available to the public for inspection and can only be inspected by the competent authorities or through a court order.
Popular holiday destination and major international financial centre. A few words about Cyprus?
That's exactly what Cyprus is. It offers quality, value for money, an attractive tourism and at the same time a highly skilled workforce, access to the EU market and with its citizens having one of the highest EU percentages in tertiary education. Cyprus situated at a crossroad between Europe, Asia and the Middle East, provides modern infrastructure and is relatively inexpensive to do business and to live.
For all those beach lovers out there, Cyprus is the proud recipient of 74 Blue Flag beaches - an eco-label awarded to beaches and marinas across the globe that meet its standards - and is also crowned «Cleanest Bathing Waters in Europe», with a consistent 100% score, year after year.
From Cyprus to Switzerland: What is the cooperation with Leo Trust Switzerland like?
We have an excellent collaboration with Leo Trust Switzerland; we feel part of the family and personally, I believe that this type of relationship is the only way to succeed. Globalization and the rapid advances in technology and means for communication, is allowing us to offer services as a group and not just as individual companies.
Leo Trust is an international group with international clients requesting services in multiple jurisdictions, therefore having employees with the mindset that they are «citizens of the world» is an advantage.
Leo Trust is a dynamic financial services provider. What can we expect from the foreseeable future?
You can expect the group to expand its physical presence into the Middle East – with collaborations and a Leo office to be based in the United Arab Emirates (UAE), probably Dubai. This expansion could be led by the Cyprus team due to my extensive experience of living and working in the UAE as well as to Cyprus’s proximity to the region. Furthermore, you can expect a shift into the FinTech industry with various services around «crypto» being offered and embedded in our current and new clients’ portfolios.
Regarding what you can expect from Leo Cyprus is to promote the services discussed earlier as well as further offers including the promotion of Cyprus funds and fund management licenses. Cyprus is becoming a regional player for individuals and companies alike that want to have a foothold in the EU with competitive corporate and personal tax rates while enjoying great weather, food and professional business relationships.
Nicely put, Harris, thank you for this interview!
Do you have any questions? Contact our team, and we will provide you with the information you need.
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This article is aimed at providing a general overview and summary of the issue. It is non-binding, and does not and should not be taken to constitute legal advice.
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