Special Tax Treatment

Shipping Companies
Cyprus is considered as one of the most competitive shipping centres in the world in terms of registration fees and taxes.

No tax is imposed on profits from the operation of Cypriot registered vessels, or on dividends received from a ship-owning company.

Income arising from ship management activities is subject to tax at 4,25%. Alternatively, a ship-management company may choose to pay at a rate equal to 25% of tonnage tax rates of vessels under management if deemed more beneficial.

International Trusts
Cyprus International Trusts are widely utilised as a vehicle for international tax planning, offering the following tax advantages:

• Income and gains of a Cyprus International Trust, derived from sources outside Cyprus are exempt from any tax imposed in Cyprus under certain conditions.
• Dividends, interest or other income received by a Trust from a Cyprus international business company are not subject to tax nor are they subject to withholding tax.
• No capital gains tax is charged on the disposal of assets of an International Trust.
• Exemption from taxation in the case of an alien who creates an International Trust in Cyprus and retires in Cyprus under certain conditions.

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