Costs to Set Up a Limited Company in Cyprus Explained
Starting a business in a new country involves a number of legal and financial considerations. While Cyprus is known for its favorable tax and business environment, understanding the costs involved in setting up a limited company is crucial for a smooth and successful venture. This guide provides a detailed breakdown of the one-off and ongoing costs you can expect when registering a company in Cyprus in 2025. For a broader perspective on the registration process, you can read our guide on Cyprus Company Registration: A Step-by-Step Guide 2025.
1. One-Off Company Setup Costs
These are the initial expenses you'll incur to get your company registered and operational. They are typically paid to professional service providers, such as lawyers or corporate services firms, who handle the registration process on your behalf. For more on this, you can check our FAQ Guides section.
Professional Fees
The majority of the initial cost is the professional fee paid to a lawyer or a corporate services provider. These professionals are essential as they handle all the legal and administrative aspects of the registration. Their services typically include:
- Name Approval: Submitting a name application to the Registrar of Companies.
- Document Preparation: Drafting the Memorandum and Articles of Association.
- Registration: Filing all the necessary documents with the Registrar of Companies.
- Bank Account Opening: Assisting with the process of opening a corporate bank account.
The cost for these services can range from €1,500 to €3,000, depending on the complexity of the company structure and the firm you choose. It is a one-time fee that ensures a smooth and legally compliant process. You can find a professional to help with this in our directory of Professional Corporate Services.
Government Fees
In addition to the professional fees, there are a number of government fees that are paid to the Registrar of Companies. These fees are fixed and include:
- Name Approval Fee: Approximately €50 for a fast-track process.
- Registration Fee: Approximately €250 for the registration of the company.
- Share Capital Tax: A one-time tax of 0.6% on the company's nominal share capital. For example, a company with a nominal share capital of €1,000 would pay a tax of €6.
These government fees are a necessary part of the registration process and are typically included in the professional fees of your chosen service provider. You can get more information on the tax system in our finance, banking, and investment section.
2. Ongoing Annual Company Costs
Once your company is registered, there are a number of recurring annual costs that you need to budget for to keep your company legally compliant and operational. These costs are a part of the local business environment, and you can explore more about them in our guide on The AI-Powered Marketer: Business Adviser.
Annual Levy Fee
All Cyprus-registered companies are required to pay an annual levy fee to the Registrar of Companies. The fee is currently €350 per year and is due by June 30th of each year. Failure to pay this fee can result in penalties and, in some cases, the company being struck off the register. This is a very important part of the legal requirements and should not be overlooked.
Audit and Accounting Fees
Every Cyprus-registered company is required to have its financial statements audited annually. The audit must be conducted by a licensed auditor in Cyprus. The cost of an audit and accounting services can vary greatly depending on the size and complexity of your company's operations. For a small, dormant company, the cost can start from €1,000 per year. For a more active company, the cost can be much higher. You can find a suitable accounting or auditing firm in our directory. You can also explore our business directory of all businesses on the island to find a good partner.
Company Secretary and Registered Office Fees
A Cyprus company must have a registered office and a company secretary on the island. These services are typically provided by the same professional firm that handles the registration. The annual fees for these services can range from €1,000 to €2,000. This fee covers the cost of maintaining the company's official address and ensuring that all legal and administrative requirements are met. You can also get more help and information on choosing a company name in our guide.
3. Summary of Costs and What to Expect
The total cost of setting up a limited company in Cyprus, including the professional fees and government fees, can range from €2,000 to €4,000. The ongoing annual costs, including the annual levy, audit, and company secretary fees, can be around €2,000 to €4,000 per year for a small, active company. These costs are a necessary part of operating a legally compliant and successful business in Cyprus. It is always a good idea to budget for these expenses and to work with a reputable professional to ensure that all the legal and financial requirements are met. For more on the local business environment, you can check out our guide on The AI-Powered Marketer: Business Adviser. You can also explore our directory of all advertising agencies.
Frequently Asked Questions (FAQ)
1. What is the minimum share capital for a Cyprus company?
The minimum share capital for a Cyprus company is not legally mandated, but a symbolic amount of €1,000 is often used. The share capital can be paid in cash or in kind, and it must be paid within a reasonable time after the company is registered. The amount of share capital can be increased at a later stage if needed. For more information, you can find a suitable finance, banking, and investment firm in our directory.
2. Do I need to be a resident of Cyprus to register a company?
No, you do not need to be a resident of Cyprus to register a company. Foreigners can register a company in Cyprus and own 100% of the shares. However, it is highly recommended to appoint a local resident as a director to ensure a smooth operation of the company. You can also explore our guide on buying property in Cyprus as a foreigner to get a better idea of the legal process.
3. How long does it take to register a company in Cyprus?
The process of company registration in Cyprus typically takes around two to four weeks, provided that all the necessary documents are in order. The name approval process takes a few business days, and the rest of the process takes a few weeks. It is always best to work with a professional to ensure a smooth and efficient process. You can find a professional to help with this in our Professional Corporate Services directory.
4. What is the corporate tax rate in Cyprus?
The corporate tax rate in Cyprus is a flat 12.5%, which is one of the lowest in the European Union. Additionally, companies benefit from a number of tax exemptions, including an exemption on capital gains and dividend income. The country has also signed double taxation treaties with over 60 countries, which prevents a company from being taxed twice on the same income. You can find a suitable accounting or auditing firm in our business directory.
5. Is it mandatory to have a local bank account?
Yes, a Cypriot company must open a bank account in Cyprus. The bank account will be used to conduct all the financial transactions of the company. The company must also maintain accurate financial records and submit an annual financial statement to the Registrar of Companies. This is a very important part of the legal and financial requirements and should be handled by a professional.
6. What is the Annual Levy Fee?
All Cyprus-registered companies are required to pay an annual levy fee to the Registrar of Companies. The fee is currently €350 per year and is due by June 30th of each year. Failure to pay this fee can result in penalties and, in some cases, the company being struck off the register. This is a very important part of the legal requirements and should not be overlooked.
7. Do I need an auditor for my company?
Yes, every Cyprus-registered company is required to have its financial statements audited annually. The audit must be conducted by a licensed auditor in Cyprus. The cost of an audit and accounting services can vary greatly depending on the size and complexity of your company's operations. For a small, dormant company, the cost can start from €1,000 per year. You can find a suitable business partner in our directory.
8. What is the role of a company secretary?
The company secretary is responsible for the administration and compliance of the company. They are responsible for maintaining the company's records, filing the necessary documents with the Registrar of Companies, and ensuring that the company complies with all the local laws and regulations. It is a very important role and should be handled by a professional. You can also get more help and information on choosing a company name in our guide.
9. Can I open a bank account without a physical presence in Cyprus?
Yes, it is possible to open a bank account in Cyprus without a physical presence. However, the process can be more complex and may require a number of additional documents. It is always best to work with a professional to ensure a smooth and efficient process. Our guide on Cyprus for Expats can give you more information on this. You can also explore our directory of finance, banking, and investment for more information.
10. Are there any other hidden costs I should be aware of?
The costs outlined in this guide are the most common and significant expenses. However, there may be other costs depending on your specific business, such as licensing fees, legal fees for contracts, or fees for specific permits. It is always best to consult with a professional to get a clear and complete picture of the costs involved in setting up your business. You can also get more help and information on our FAQ and Guides page.
