# Anyone started a business in cyprus?



## thejohn32 (Feb 6, 2010)

Hello again

I have just had a quote to register a business in Cyprus from focus buisness services. Does this sound overly expense to you?

Set up company. 345 euro
Disbursements. 800 euro
It's year service of accountants. 1595 euro
Vat another 349 euro. 

Total of 3089 euro to set up and run a company. 

Does that seem expensive ??


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## PeteandSylv (Sep 24, 2008)

I've never run a business here but have spoken with others who have. It sounds very expensive to me. How does it compare with other quotes you've had for the same work?

Pete


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## thejohn32 (Feb 6, 2010)

This is the only company that have returned my emails !

the work is for - quote "New Company / Accounting and audit (as required by law) / Income tax law compliance work / preperation of annual financial statements / submission of Tax Return / Legal representation - appointment of directors and nominee shareholders / routine coroprate services of work of small duration / Maintenance of Statutory Books and submission of annual return, covering the first 12 month period - up to 50 transactions.

its all greek to me !


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## PeteandSylv (Sep 24, 2008)

If it's all Greek to you I suggest it will be helpful to acquire some more knowledge of business structure which you can do by searching the internet. Although there are specific requirement in Cyprus the general principle is the same as the UK.

One of the first decisions you need to research and decide is whether you need a limited company or whether you can be a sole trader. The latter avoids the costs and obligations of a registered limited company and the accounting requirements are simpler.

Half of the stuff you list that they are going to do will take a few minutes so you seriously need a competitive quote. Businesses in Cyprus are notorious for not returning emails so you should not be surprised in this. They are still in the age of the fax! If you can get recommendations for accountants all the better otherwise a phone call to 1 or 2 to discuss your needs will probably give better results.

Pete


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## thejohn32 (Feb 6, 2010)

PeteandSylv said:


> If it's all Greek to you I suggest it will be helpful to acquire some more knowledge of business structure which you can do by searching the internet. Although there are specific requirement in Cyprus the general principle is the same as the UK.
> 
> One of the first decisions you need to research and decide is whether you need a limited company or whether you can be a sole trader. The latter avoids the costs and obligations of a registered limited company and the accounting requirements are simpler.
> 
> ...



Hello and thank you for that.

I do understand a little bit about buisness but not the Cyprus buisness and set up fees and structure.

I have contacted a few other companies also, and i will make phone calls if i get no answer but most of them are shut for easter.

I was hoping to get some feeling on the fees this one company were asking, if that is about the norm, and if any one else starting a buisness, shop based and online paid anything different. 

I know in UK with the tax structure a company turning over around £10K a year would be better as a Ltd company, however i dont know how this all works in Cyprus.

any further thoughts more than welcome. 
Thank you 

john


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## PeteandSylv (Sep 24, 2008)

thejohn32 said:


> I know in UK with the tax structure a company turning over around £10K a year would be better as a Ltd company, however i dont know how this all works in Cyprus.
> 
> 
> john


I would seriously question that. Any tax related decision would come from considering profits not turnover.

Without meaning to be being rude I would also suggest that a business turning over £10k in the UK was more of a hobby than a business!

Pete


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## DaveKim (Mar 25, 2013)

thejohn32 said:


> Hello and thank you for that.
> 
> I do understand a little bit about buisness but not the Cyprus buisness and set up fees and structure.
> 
> ...



Hi John
Your information is wrong about runing a Ltd company is better if your turning over £10k.
What you need to look at is how much you will turn over and how much is likely to be profit.Only then you can decide whether to go Ltd or sole trader.Having had both in the Uk I would never have a limited liability company again as tax the and paperwork is a nightmare.One of the most important thing to know in Cyprus is Vat as apparently You are legally obliged to register if you turn over 15,000e in any one month.Here in the Uk the threshold is £79,000 per year.Also here in the Uk when you submit you Vat returns any money you are claiming back is done immediatly on line(which is so important for cash flow especially when 1st starting up)In Cyprus it can take between 6-12 months for any Vat claims you may want to claim back.Im starting a business there in 10 weeks and will be a sole trader.The taxable amounts at the moment are quite good.1st19,000e are not 
taxed.Also if you go Ltd you will have to pay Corporation Tax currently 10% but is expected to rise.In the Uk its currently 20%!
Hope this helps
Dave


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## thejohn32 (Feb 6, 2010)

PeteandSylv said:


> I would seriously question that. Any tax related decision would come from considering profits not turnover.
> 
> Without meaning to be being rude I would also suggest that a business turning over £10k in the UK was more of a hobby than a business!
> 
> Pete



Without getting into the schematics of this, as it is not what i was asking - you are right i ment £10k profits - basic sums in UK are:

Annual Profits £10,000.00 

Self Employed 
Tax Payable 379.00 
National Insurance 353.35 
Total Payable 732.35 
Net Spendable Personal Income 9,267.65 

Limited Company 
Company Tax Payable 502.40 
Personal Tax Payable 0.00 
Total Payable 502.40 
Net Spendable Personal Income 9,497.60 

Saved By Registering As A Limited Company £229.95 

If profits were £20k then Saved By Registering As A Limited Company £1,129.95 , then the more the profits the bigger the savings but you dont start saving until your profit hits the £10K mark.

that aside all i am trying to find out - is £3000 Euro or theres about the average for setting up a buisness in Cyrpus with a years solicitors fees for the work they are going to do.

My buisness might not plan to be the largest in Cyprus by any means, and you are probably right it will be along the lines of a part time buisness / hobby. But i still want to start it right, do it correctly and not get ripped off from the very start.

thanks again 

john


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## DaveKim (Mar 25, 2013)

DaveKim said:


> Hi John
> Your information is wrong about runing a Ltd company is better if your turning over £10k.
> What you need to look at is how much you will turn over and how much is likely to be profit.Only then you can decide whether to go Ltd or sole trader.Having had both in the Uk I would never have a limited liability company again as tax the and paperwork is a nightmare.One of the most important thing to know in Cyprus is Vat as apparently You are legally obliged to register if you turn over 15,000e in any one month.Here in the Uk the threshold is £79,000 per year.Also here in the Uk when you submit you Vat returns any money you are claiming back is done immediatly on line(which is so important for cash flow especially when 1st starting up)In Cyprus it can take between 6-12 months for any Vat claims you may want to claim back.Im starting a business there in 10 weeks and will be a sole trader.The taxable amounts at the moment are quite good.1st19,000e are not
> taxed.Also if you go Ltd you will have to pay Corporation Tax currently 10% but is expected to rise.In the Uk its currently 20%!
> ...


Hi John 
Back to your original question.In my opinion that does sound expensive.
I set up a Ltd company for less than £100 in the uk and with accountancy fees for my 1st year were £400 without any limits on how many transactions.Keep looking for other companys im sure you will find one a lot lot cheaper.Also Pete is quite right by saying its very similar to set up as the Uk.
Good luck
Dave


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## thejohn32 (Feb 6, 2010)

DaveKim said:


> Hi John
> Your information is wrong about runing a Ltd company is better if your turning over £10k.
> What you need to look at is how much you will turn over and how much is likely to be profit.Only then you can decide whether to go Ltd or sole trader.Having had both in the Uk I would never have a limited liability company again as tax the and paperwork is a nightmare.One of the most important thing to know in Cyprus is Vat as apparently You are legally obliged to register if you turn over 15,000e in any one month.Here in the Uk the threshold is £79,000 per year.Also here in the Uk when you submit you Vat returns any money you are claiming back is done immediatly on line(which is so important for cash flow especially when 1st starting up)In Cyprus it can take between 6-12 months for any Vat claims you may want to claim back.Im starting a business there in 10 weeks and will be a sole trader.The taxable amounts at the moment are quite good.1st19,000e are not
> taxed.Also if you go Ltd you will have to pay Corporation Tax currently 10% but is expected to rise.In the Uk its currently 20%!
> ...


Dave

Thank you very much for that - that is very useful as i will not be turning over 15000e a month so well within limits.

going on your info it definitly looks like sole trader is the better option, of course it was not an option the company that did get back to me suggested - probably cause there is no money in it for them.

I will definitly be getting a Finanncial Advisor when i get out there, but i am looking to have the company registered etc prior to me getting there.

Can i ask who you set you up as a sole trader and what you paid? Pvt me if not allowed to post on here.

again thanks for all the feedback


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## DaveKim (Mar 25, 2013)

thejohn32 said:


> Dave
> 
> Thank you very much for that - that is very useful as i will not be turning over 15000e a month so well within limits.
> 
> ...


Hi John
The first step in setting up a business in Cyprus is to submit an application to the Registrar of Companies. They will then approve or reject your suggested name.

You must submit specific forms to the Registrar of Companies. These include your Memorandum and Articles of Association, and should be submitted through a solicitor who is a member of the Cyprus Bar Association.

The Companies Act 1968-1995 governs the registration of companies and legal entities. Under this investors may set up:

private or public companies
general or limited partnerships
European companies or 'Societas Europaea' (SEs)
branches
trade names
You are also able to set up as a sole trader in Cyprus.

Permits and licences

Your business type will determine which permits and licences you require. These might include:

a general business permit
a sales permit
a professional licence
a food service permit
a child care licence
an alcohol and tobacco permit
a sign permit
If you are planning to live and work in North Cyprus, you will need:

a residence permit
a work permit
Online support

Under European law, each country must have a single point of contact for European businesses wanting to trade and set up in that country. Most countries have opted to set up a website. Belgium's website provides information in English and Greek on everything you need to know about setting up a business or moving an existing business to Cyprus. You can access information such as:

where to hire professional services in Cyprus to help your business grow
details of grants, loans and finance available to your business
geographical information
legal advice
If you need to apply for a permit or licence it will also guide you to the relevant authority to obtain it.

You can find information about the permits and licences you will need on Cyprus' EUGO website

Dave


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## thejohn32 (Feb 6, 2010)

Dave 

I was just reading all that on the POINT OF SINGLE CONTACT | Welcome to our Website website. 

in the mean time i got a reply back from an accountant i emailed (wonders will never cease), he said the following:

Dear Mr. Macdonald, 

In reply to your questions:

1. Yes, it is better to run your business as a self employed / sole trader.


2. Yes, we can register you as a sole trader, but in order to do this, first you must to become a Cyprus resident for Tax purposes. This means that you have to come to Cyprus and to rent a house etc., you have to be registered to Immigration Department and then to proceed with the next steps to setting up your business. 

You can check for more informations here  

3. You have to registered for VAT if your annual turnover exceed 20,000 euro

Please inform us with your Phone no. in order to have a discussion about. 

Best Regards

Palaskas Dimitrios
Corporate Consultant


So this confirms what you have been saying about better to be a sole trader, hopefully i can get the ball rolling when i come to visit in a few months.

thank you again for your advice and help

john


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## PeteandSylv (Sep 24, 2008)

It's good to see that our advice on here was confirmed by a professional who also gave honest advice rather than attempt to line his pockets.

Your 2 examples comparing sole trader to LTD company in the UK confirm that at less than 20k profit there is no advantage to being a LTD company as any tax savings will be swallowed up by registration and ongoing fees.

For the level of business you are looking at it would be quite simple to handle the all aspects of it yourself in the UK with no accountant required. I suspect this should also be true of Cyprus once you know what to submit and when and where.

Pete


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