2025 Cyprus Shipping Guide

CyprusProfile Digital Series

Maritime & Shipping


Maritime &

Shipping

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Maritime & Shipping

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PUBLICATION DATE

October 2025

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Maritime & Shipping

Contents

Cyprus at a Glance: Key Facts and Figures 6

Insight: Marina Hadjimanolis, Deputy Minister of Shipping 10

Insight: George Papanastasiou, Minister of Energy, Commerce, and Industry 14

Sector Profile: Navigating Toward Sustainable Growth 16

Insight: Alexandros Josephides, Director General, Cyprus Shipping Chamber 24

Insight: Marios Tannousis, CEO, Invest Cyprus 25

Incentives: Attracting Non-EU Business 26

Business Operating Environment: Guide to Doing Business in Cyprus 33

Who’s Who in Cyprus: The definitive guide to Cyprus’ leading companies,

executives, and professional advisors 46

4


Maritime & Shipping

CYPRUS

AT A

GLANCE

Lying at the crossroads of Europe, Asia and Africa, Cyprus has long

served as a major eastern trading post. It is a small country, but the

third largest island in the Mediterranean Sea and shares a maritime

border with Egypt 300km to the south, Lebanon 108km to the east

and Turkey 71km to the north, while mainland Greece lies 800km to

the north-west. With 10,000 years of history, the island’s strategic

location has long made it a jewel in the crown of the powers of the day.

PAPHOS

(Pafos)

106,600

Paphos

International

Airport

LIMASSOL

(Lemesos)

275,100

NICOSIA

(Lefkosia)

364,300

Larnaca

International

Airport

LARNACA

(Larnaka)

162,800

35ºN

33ºE

FAMAGUSTA

(Ammochostos)

57,600

6


Maritime & Shipping

CYPRUS

DATA

MEMBERSHIPS

EU & Eurozone

World Trade

Organization

United Nations

Council of Europe

Commonwealth

World Bank & IMF

RELIGION

89.1%

Greek Orthodox

TOTAL POPULATION (2024)

966,400

Republic of Cyprus

80%

Cypriot

20%

Non-Cypriot

OFFICIAL LANGUAGES

Greek &

Turkish

(business generally

conducted in English)

TIME

+2 Hours

ahead of GMT

AREA & SIZE

9,251 km 2

(3,355 km 2 in the

occupied area)

POPULATION DENSITY

148

(persons per km 2 )

MEDIAN AGE

38.6

CURRENCY

Euro (€)

SUNSHINE

340 days

of sunshine/year

2.9% Roman Catholic

2.0% Protestant/Anglican

1.8% Muslim

1.7% Unknown/Atheist

1.0% Buddhist

1.4% Other

AVERAGE TEMPERATURE

+13ºC

Winter

+34ºC

Summer

MAIN MEDIA

Cyprus Mail

Phileleftheros

Politis

CyBC

7


Maritime & Shipping

CYPRUS

BUSINESS

FIGURES

TOTAL GDP

€33.6

billion

(2024)

GDP PER CAPITA

€34,495

(2024)

11.6%

Taxes & Subsidies

4.5%

Construction

5.8%

Mining,

manufacturing,

electricity & water

GDP

BY SECTOR

76.9%

Services

1.2%

Agriculture,

forestry & fishing

UNEMPLOYMENT

4.9%

(2024)

GDP GROWTH

3.4%

(2024)

INFLATION

2.3%

(2024)

INTERNATIONAL RANKINGS

Standard & Poor’s

A-

CORPORATE

TAX RATE

12.5%*

TIME TO START

UP A BUSINESS

1.3 days

ACCOUNTING

STANDARD

IFRS

Fitch

A- Moody’s

A3

(October 2025)

MAIN TRADING PARTNERS

UK

Germany

Italy

France

Israel

Greece

China

CRIME

584 cases

per 100k

population

*legislative changes in progress to

increase to 15% in line with OECD

global minimum tax initiatives

8

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Maritime & Shipping

INSIGHT

Deputy Minister of Shipping

Marina Hadjimanolis

As global shipping faces increased pressures, Cyprus

is reinforcing its status as a leading maritime hub

by integrating smart technologies, enhancing

operational efficiency, and supporting sustainable

shipping solutions, says Marina Hadjimanolis.

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Maritime & Shipping

How has Cyprus strengthened its position as a global

maritime hub, and what are the key advantages that make the

country attractive to international shipping companies?

The foundation upon which Cyprus builds its reputation as a reliable and highquality

maritime hub lies in its ability to successfully combine a businessfriendly

regulatory framework, a competitive and transparent tonnage tax system,

and a proactive maritime administration. These elements create an attractive

environment for international shipping companies, reinforcing Cyprus’ position

as a leading global shipping centre.

A key pillar of this success is the Shipping Deputy Ministry’s ongoing

commitment to maintaining the highest safety standards for its fleet, protecting

the environment, and improving working and living conditions for seafarers. At the

same time, Cyprus ensures full compliance with international and EU obligations,

further enhancing the credibility and reliability of its shipping sector.

Additionally, the Shipping Deputy Ministry implements a range of strategic

initiatives to further advance Cyprus’

shipping industry. These include

promoting a culture of quality across

Cyprus flag ships, delivering responsive

and seamless 24/7 customer-focused

services, accelerating the digitalisation

of maritime administration, supporting

maritime and blue professions, and

IMy vision is a strong and

sustainable Cyprus shipping sector

and having a prominent position

on the global shipping map.

ensuring seafarers receive high-quality training. Innovation is at the core of

Cyprus’ maritime strategy, with ongoing efforts to integrate smart technologies,

enhance operational efficiency, and support sustainable shipping solutions.

Collectively, these efforts strengthen Cyprus’ reputation as a safe, socially

responsible, and forward-thinking maritime hub, one that not only contributes

significantly to the national economy but also creates jobs, fosters specialisation,

and builds expertise within the sector.

The global shipping industry is under increasing pressure to

reduce emissions. What initiatives is Cyprus undertaking to

promote greener shipping and compliance with International

Maritime Organization (IMO) environmental regulations?

Environmental sustainability is admittedly one of the main challenges that the

global maritime industry faces. Issues like the reduction of GHG emissions,

the elimination of pollution and the transition to cleaner technologies have

taken over the shipping world that seems to be in a constant battle to reduce its

environmental footprint. In this race for sustainability, the shipping world has to

pursue environmentally friendly technologies.

IMO plays a leading role in embodying environmental values into the global

framework of shipping. Cyprus, as one of the leading advocates of sustainable

shipping, fully supports the 2023 IMO Strategy on Reduction of GHG Emissions

from Ships and we are closely collaborating with all the IMO Member States for the

strategy to reach its end goals. Cyprus actively contributes to the goals and efforts

11


Maritime & Shipping

taking place for environmental sustainability through its integrated maritime

policy.

Cyprus is offering green incentives to shipowners who register their vessels

under the Cyprus flag and whose vessels demonstrate effective greenhouse gas

emission reductions. This is translated to up to 30% reduction on the annual

tonnage tax of complying Cyprus flag vessels.

What recent policy or regulatory changes have been

introduced to enhance the Cyprus shipping registry, and

how are they benefiting shipowners and operators?

Cyprus has introduced several recent policy and regulatory changes to enhance

its shipping registry, which are significantly benefiting shipowners and

operators.

One key development is the establishment of the One-Stop Shipping Centre in

November 2023. This specialised maritime service centre aims to provide efficient,

high-quality support to shipping companies and maritime-related businesses

based in Cyprus. The centre facilitates the processing of requests related to various

shipping and maritime activities, creating a streamlined process that enhances

service delivery for the industry.

Additionally, the Shipping Limited Liability Company (S.L.L.C.) Law of 2022 was a

major regulatory milestone. This law strengthens Cyprus’ position as a competitive

shipping hub by simplifying the formation and registration of a Shipping Limited

Liability Company (S.L.L.C.). It also establishes a dedicated Registrar for S.L.L.C. and

creates an official registry, under the supervision of the Shipping Deputy Ministry.

This change is part of the broader effort to improve the services provided by the

One-Stop Shipping Centre. It is anticipated that the said Law shall enter into force

and shall be implemented, once the necessary new EU harmonisation legislative

amendments and relevant subsidiary

legislation are adopted and once the

required digital and administrative

infrastructure are fully in place.

Another important change is the

introduction of tax incentives and

environmental discounts. Under

the Tonnage Tax (Environmental

Incentives) Order of 2021, shipowners

of both Cyprus and EU vessels are

eligible for a discount of up to 30% on

IInnovation is at the core of

Cyprus’ maritime strategy, with

ongoing efforts to integrate

smart technologies, enhance

operational efficiency, and support

sustainable shipping solutions.

the annual tonnage tax. This incentive is granted based on a vessel’s emission

reductions and the use of alternative fuels, supporting Cyprus’ commitment to

reducing carbon emissions and promoting environmentally sustainable shipping

practices. In 2024 alone, 15 companies benefitted from these incentives, achieving

a total reduction of €100,787 in their tonnage tax for 68 vessels.

These policy changes, along with other initiatives, make Cyprus an even more

attractive destination for shipowners and operators by offering a competitive

regulatory environment, efficient services, and tax incentives that support both

business and sustainability goals.

12


Maritime & Shipping

Given the current geopolitical climate and economic

uncertainties, how resilient is Cyprus’ shipping sector,

and what measures are being taken to mitigate risks?

Shipping, being an international industry with particularities, is vulnerable to

the volatile geopolitical climate and political and economic developments. We

have recently witnessed how the safe transport of goods, for example through the

Suez Channel, could be disrupted because of attacks.

After its independence, recognising the political, economic and social

importance of shipping, Cyprus has managed to develop a strong shipping sector,

solidifying its standing as a leading maritime ecosystem, encompassing a quality

ship registry, ranking amongst the top registries worldwide and a robust maritime

cluster. In 2023, we celebrated 60 years since the establishment of the Registry of

Cyprus Ships, which despite the difficulties and challenges we faced, remains a

strong and reputable ship registry of excellence and quality.

Through our active participation both in EU and IMO, we work closely with other

states, relying on policies based on principles and values governing international

law, ensuring at the same time a level playing field, supporting the long-standing

objective of the sustainable growth of international shipping. We continue to build

strong bilateral relations with third countries, in the interest of Cyprus shipping,

while we work very closely with the private sector and our valuable partners,

the Cyprus Union of Shipowners and the Cyprus Shipping Chamber aiming to

effectively react and proactively adapt to ensure that we are able to tackle the

challenges and safeguard the sustainable growth of shipping sector. In a nutshell,

we continue to reinforce the successful operating framework of Cyprus Shipping,

enhancing the resilience of the sector.

What is your vision for the future of Cyprus

shipping, and what strategic goals would you like

to achieve during your time as Minister?

My vision is a strong and sustainable Cyprus shipping sector and having a

prominent position on the global shipping map. Therefore, my objective is

to create the appropriate framework and solid foundations, which will allow the

substantial strengthening and resilience of Cyprus shipping. This can be achieved

through targeted actions based on the following three pillars: the human resources,

the presence of Cyprus at the international shipping fora, and the cooperation

with the shipping community.

The contribution of the human resources is undoubtedly extremely important,

and our priority is to further strengthen the Deputy Ministry with properly trained

ship surveyors and maritime affairs officers, as well as to invest on the knowhow

and expertise of the existing personnel. The participation at the high-level

international fora, is very important, giving us the opportunity to be part of the

decision-making process and formulating policies. Finally, the cooperation with

the shipping industry is essential, in a

sector with so many particularities and

stakeholders.

READ FULL INTERVIEW ON

www.cyprusprofile.com

13


Maritime & Shipping

INSIGHT

Minister of Energy, Commerce and Industry

George

Papanastasiou

14


Maritime & Shipping

What is the strategic importance of the Cyprus shipping

sector for the country’s economy and its role in strengthening

Cyprus’ position on the global maritime stage?

Shipping is a major sector of the Cypriot economy, contributing significantly

to GDP and employment, while enhancing the country’s international profile.

Cyprus is recognised as a leading maritime centre, hosting one of the world’s

largest ship management communities, as well as a shipping industry that

provides services across the full spectrum of shipping-related activities.

The importance of the sector extends beyond economic figures. It reflects

Cyprus’ ability, as a small island state, to play a prominent role in a truly global

industry. The Cypriot maritime cluster encompasses a broad spectrum of

shipping and related services including, ship management, legal and financial

services, marine insurance, education and training, technology and software

providers, maritime and naval equipment suppliers, shipping agents, and

specialised professional services. Together, these create an integrated ecosystem

that provides comprehensive support to the maritime community.

In recent years, Cyprus’ maritime cluster has expanded with the establishment

of maritime academies, Protection and Indemnity Clubs (P&I Clubs), and the

creation of a scientific and business

centre of excellence in shipping and

marine research. This concentration

of expertise ensures that Cyprus can

offer competitive and reliable services

to international markets.

Cyprus’ strategic location at the crossroads of three continents, combined with

its long maritime tradition, gives the country a natural advantage. Our policies,

regulatory framework, and openness to international business, have transformed

Cyprus into a respected maritime nation. As a member of the European Union,

Cyprus offers shipowners a transparent and efficient legislative environment,

fully aligned with international and EU maritime standards, strengthening its

reputation as a flag of quality.

Looking ahead, our priority is to support the sector as it adapts to ongoing

global transformations, particularly in the areas of sustainability, digitalisation,

and innovation. Cyprus closely monitors international developments on

decarbonisation and environmental standards, encouraging the adoption of

practices and solutions that enhance efficiency, safety, and competitiveness

across the maritime value chain.

The Ministry of Energy, Commerce and Industry, in close cooperation with the

Shipping Deputy Ministry, actively supports Cypriot companies operating in the

maritime sector. Through participation in specialised international shipping and

maritime exhibitions and trade missions, the Ministry helps strengthen their

international presence, expand business networks, and promote Cyprus’ expertise

abroad.

Ultimately, shipping is more than an economic sector for Cyprus – it is a

strategic national asset. It connects the country to world markets, underpins its

role as an international business hub, and serves as a platform for innovation and

sustainable growth. The Ministry of Energy, Commerce and Industry remains

fully committed to supporting this vital industry and enhancing the outward

orientation of Cypriot service-providing enterprises and their penetration into

international markets.

15

IShipping is more than an

economic sector for Cyprus –

it is a strategic national asset.


Maritime & Shipping

Sector Profile

Navigating Toward

Sustainable Growth

Cyprus remains one of the world’s most

influential maritime hubs, continuing to

enhance its position through targeted initiatives,

policy reforms, and a steadfast commitment

to innovation and sustainability. The country’s

proactive approach has reinforced its status as

a quality registry and an attractive destination

for international shipping companies.

16


Maritime & Shipping

The Cyprus shipping sector continues to play a pivotal role in the island nation’s

economy, contributing significantly to employment and economic growth. The

industry provides 9,000 onshore jobs, while over 55,000 seafarers are employed

on Cyprus-flagged vessels. The Cyprus Shipping Deputy Ministry remains globally

recognised as a high-standard registry, ranking among the largest in the world.

It has played a decisive role in securing Cyprus’ significant position on the global

maritime map and in strengthening its influence in international shipping affairs.

The vibrant and resilient sector is one of the longest-serving generators of

foreign direct investment and is primed

for further growth. From September

2023 to the end of 2024, the Cyprus fleet

grew by 18%, with 198 newly registered

vessels. This expansion has raised

the total gross tonnage of the Cyprus

fleet to over 25 million tons. In 2024,

companies registered under the Cyprus

Tonnage Tax system increased by 15%,

IThe Cyprus Shipping Deputy

Ministry remains globally

recognised as a high-standard

registry, ranking among

the largest in the world.

highlighting Cyprus’ continued appeal as a maritime hub. These impressive figures

underscore the country’s commitment to maintaining a strong and competitive

shipping environment.

A ROBUST SHIPPING INDUSTRY

Despite global challenges, the Cyprus shipping industry continues to thrive

thanks to the government’s targeted action plan, both domestically and

internationally, aimed at attracting new, high-quality vessels to its registry. This

effort has been bolstered by ongoing regulatory improvements and a clear focus

on maintaining the highest standards in safety, environmental protection, and

operational efficiency.

The country’s maritime industry represents around 7% of GDP and has a

substantial contribution to the development of the economy. Of this figure,

shipmanagement alone accounts for around 5%. Cyprus has a large resident

shipping industry with over 250 companies based on the island covering the

full range of shipping activities and related services. Foreign companies with a

physical presence in Cyprus, particularly from Germany, Greece, Switzerland,

Malta, and Singapore, contribute significantly.

17


Maritime & Shipping

There are many factors which have supported the steady growth of shipping

in Cyprus. The island’s location at the crossroads of three continents – Europe,

Africa and Asia – has played a prominent role in the success of Cyprus as a major

international centre as it provides easy access to markets and the ideal time zone

for international operations.

Industry players note that the appeal of Cyprus for firms who operate globally

is its unique mix of strategic location, its business-friendly environment and the

exceptional quality of life. In addition, the country’s well-established maritime

ecosystem, supportive regulatory landscape, and easy access to talent are strong

pull factors. Cyprus has also seen a significant increase in technology companies

relocating their headquarters and operational units to the island. The burgeoning

tech and innovation industry is also filtering into the maritime sector, making

Cyprus an attractive jurisdiction for companies focused on maritime tech, bunker

trading and chartering.

STRATEGIC REFORMS AND TECH TRANSFORMATION

Cyprus continues to enhance its maritime ecosystem through significant

policy and regulatory changes. The country’s Shipping Deputy Ministry was

established in 2018, implementing new supportive measures and flexible

mechanisms to upgrade Cyprus’ status as one of the most formidable maritime

centres worldwide. In addition, Cyprus’ two dynamic shipping associations – the

Cyprus Shipping Chamber (CSC) and the Cyprus Union of Shipowners (CUS) –

work closely with the state to constantly upgrade the maritime administration

and to build up its competitive offering.

A more recent key development was the establishment of the One-Stop

Shipping Centre in November 2023. This specialised maritime service centre aims

to streamline services and support shipping companies operating within Cyprus,

providing high-quality, efficient

assistance for various shipping and

maritime activities. By consolidating

processes under one roof, Cyprus

has improved service delivery and

strengthened its appeal to the global

shipping community.

The Shipping Limited Liability

Company (S.L.L.C.) Law of 2022 marked

another major regulatory milestone,

designed to simplify the formation

and registration of a Shipping Limited

IThe burgeoning tech and

innovation industry is also

filtering into the maritime sector,

making Cyprus an attractive

jurisdiction for companies

focused on maritime tech,

bunker trading and chartering.

Liability Company. The establishment of a dedicated Registrar and the creation

of an official registry, under the supervision of the Shipping Deputy Ministry,

represents a bold move towards enhancing administrative efficiency. However,

the implementation of this law depends on the adoption of new EU harmonisation

legislative amendments and relevant subsidiary legislation, as well as the

completion of necessary digital and administrative infrastructure.

Digital transformation also plays a pivotal role in Cyprus’ maritime vision. The

full digitalisation of the Shipping Deputy Ministry is scheduled for completion in

2025. This initiative aims to improve efficiency, competitiveness, and sustainability

within the sector, enhancing the global reputation of Cyprus shipping and ensuring

the nation maintains its competitive edge in an evolving maritime landscape.

18


Maritime & Shipping

COMPETITIVE TONNAGE TAX

major driver of the shipping sector’s success was put in place in 2010 when,

A after more than 10 years of negotiations with Brussels, Cyprus secured an

agreement for an upgraded and competitive EU-approved tonnage tax (TT) system.

In 2020, this agreement was reapproved by the EU, and unanimously approved

by the House plenum, ensuring the

stability of the tax framework until 2030

and maintaining Cyprus’ prominent

position in the shipping arena both on a

European and international level.

The main benefit of the TT regime

is the certainty it provides companies

ICyprus offers green incentives

to shipowners whose vessels

demonstrate effective greenhouse

gas emission reductions.

on their annual tax obligations, enabling them to do their business planning

accordingly. The TT system has attracted scores of companies over the years

and saw a further 15% increase in company registrations in 2024. While other

jurisdictions might have less expensive TT regimes, Cyprus’ incorporates all three

types of maritime activities – ship owning, shipmanagement and chartering,

making it unique in the EU where other jurisdictions might specialise in just one

or two of these areas.

PROMOTING ENVIRONMENTAL SUSTAINABILITY

As a leading advocate of sustainable shipping, Cyprus supports the 2023 IMO

Strategy on the reduction of greenhouse gas emissions from ships. The

country’s integrated maritime policy actively contributes to global environmental

goals through a range of innovative measures.

Cyprus offers green incentives to shipowners whose vessels demonstrate

effective greenhouse gas emission reductions. These incentives include a

reduction of up to 30% on the annual tonnage tax for vessels achieving significant

emission reductions and for the use of alternative fuels. In 2024 alone, 15

companies benefited from these incentives, resulting in a total tax reduction of

€100,787 for 68 vessels.

Cyprus’ commitment to environmental sustainability also extends to the

promotion of alternative fuels and environmentally friendly technologies. By

aligning its policies with the IMO’s decarbonisation objectives, Cyprus continues

to play a leading role in driving the global shipping industry towards a greener

future.

19


Maritime & Shipping

SUPPORTING SEAFARERS AND FOSTERING TALENT

The welfare of seafarers remains a top priority for Cyprus, recognising their

essential contribution to the maritime industry. Measures aimed at enhancing

training, ensuring compliance with the STCW 78 Convention, and promoting

career opportunities are central to the government’s strategy.

A control mechanism ensures that seafarers serving on Cyprus-flagged vessels

possess the knowledge and competence required for their positions, meeting or

exceeding international standards. Additionally, Cyprus is investing in maritime

education through partnerships with local private universities and new activities

with the Ministry of Education, Sport,

and Youth.

The Shipping Deputy Ministry also

offers scholarships for postgraduate

studies at the IMO International

Maritime Law Institute and the IMO

World Maritime University, with a

special emphasis on promoting gender

equality within the maritime sector.

ICyprus is setting its sights

firmly on the future, determined

to transform challenges into

catalysts for innovation,

growth, and global relevance.

OPPORTUNITIES AND CHALLENGES

In 2025, the Cyprus shipping sector continues to navigate a complex landscape

shaped by geopolitical tensions, environmental regulations, and technological

advancements. Ongoing conflicts in Ukraine and Gaza, have disrupted traditional

shipping routes, notably through the Suez Canal, leading to increased reliance on

longer alternative maritime routes. These changes affect operational costs, and

also have environmental implications due to higher emissions.

A significant hurdle remains the longstanding Turkish embargo, initiated in

1987, which prohibits Cyprus-flagged and Cyprus-managed vessels from accessing

Turkish ports. This restriction hampers the full potential of Cyprus’ maritime

industry. Moreover, a ‘second embargo’ emerged in 2023, with Turkey preventing

Cyprus-flagged ships from participating in the Black Sea Grain Initiative, further

limiting their operational scope.

Environmental regulations are also becoming increasingly stringent. The

expansion of the EU Emissions Trading System (EU ETS) and the introduction of

FuelEU Maritime are set to impose new compliance requirements on shipping

companies, necessitating investments in cleaner technologies and alternative

fuels.

Technological innovation offers both opportunities and challenges. Advancements

in satellite communications, smart analytics, and AI-driven tools are

enhancing operational efficiency and safety, with tech such as smart weather

foresight, performance analytics and report alarms, as well as enhanced cybersecurity.

However, the rapid pace of change raises concerns about the longevity

of current investments, as vessels purchased today may not meet future

technological standards.

The human element remains a critical concern. With the shortage of qualified

seafarers, recruitment and retention of staff is a priority. The industry faces a

global shortage of skilled seafarers, with a reported 9% gap in the officer supply

pool. Companies are encouraged to invest in better training, support systems, and

working conditions to attract talent and ensure the well-being of their crews.

20

THERE IS A PLACE WHERE…

you have a local partner

on the ground.

As the national investment authority, Invest

Cyprus acts as a single point of contact and one

stop shop for existing and potential investors.

Our dedicated team provides after care and

facilitation services, including supporting you in

site selection, setting up offices, staff immigration

and relocation procedures while continuing to

grow its extensive portfolio of available

projects and investment opportunities.

www.investcyprus.org.cy


Maritime & Shipping

Financially, Cyprus is making strides to bolster its maritime sector. The

government plans to allocate €1 million in 2025 to promote Cyprus as a premier

shipping hub. This investment aims to attract more shipping companies and

enhance the country’s global maritime standing.

In summary, while the Cyprus shipping industry faces significant challenges,

including geopolitical tensions and regulatory pressures, it also has opportunities

to innovate and grow. By embracing technological advancements, investing in

human capital, and advocating for the lifting of restrictive embargoes, Cyprus can

strengthen its position in the global maritime arena.

A VISION FOR THE FUTURE

C

yprus is setting its sights firmly on the future, determined to transform

challenges into catalysts for innovation, growth, and global relevance. The

country’s maritime vision is anchored in sustainability, digital transformation,

and the unwavering pursuit of excellence. With a modernised registry, a stable

regulatory environment, and a forward-looking Shipping Deputy Ministry, Cyprus

is steadily reinforcing its position as a high-performing EU maritime centre.

Strategic priorities include expanding Cyprus’ influence in international

maritime policymaking and deepening partnerships with the global shipping

community. These efforts are designed not just to adapt to change, but to lead it –

ensuring Cyprus remains agile in the face of geopolitical tension, environmental

mandates, and rapid technological evolution.

As it champions blue careers and maritime education, Cyprus is nurturing

the talent that will define the sector’s next era. It continues to enhance the

competitiveness and credibility of the Cyprus flag, which has retained its

reputation as one of the world’s most reliable and respected despite external

constraints. More than just a hub for shipmanagement, Cyprus is emerging as a

launchpad for next-generation maritime solutions – a place where innovation

and resilience shapes opportunity. With clear vision and collective resolve, Cyprus

is not just keeping pace with global shipping – it is helping to steer its future.

22


Maritime & Shipping

CYPRUS

MARITIME INDUSTRY

3rd

largest ship

register in Europe

20%

of the world’s

third-party

shipmanagement

activity managed

from Cyprus

+25

million

total gross tonnage

1st

third-party

shipmanagement centre

in the EU, and in the

top 3 in the world

11th

largest fleet

in the world

7%

representation of

country’s GDP 9,000

onshore jobs

55,000

seafarers

5%

of the world’s fleet

controlled from Cyprus

Cyprus fleet grew by

18%

with 198 newly

registered vessels

(2024)

Large resident

shipping industry

with over

250

companies

TT system saw

15%

increase in company

registrations (2024)

23


Maritime & Shipping

INSIGHT

Director General, Cyprus Shipping Chamber

Alexandros

Josephides

How does the Cyprus Shipping

Chamber view the current strength

of the maritime sector, and what

areas do you see as offering the

greatest potential for future growth?

The Cyprus Shipping Chamber views the current strength of

the maritime sector with confidence and optimism. Cyprus

today holds a prominent position internationally, maintaining a

leading shipmanagement centre and a leading merchant fleet

both in Europe and worldwide. More than 4% of the global fleet is

managed from Cyprus, while over 20% of the world’s third-party

shipmanagement activity is carried out by companies based here.

These figures demonstrate not only the scale, but also the resilience

and competitiveness of Cyprus Shipping.

This strong position is supported by a number of key advantages.

Central among them is Cyprus’ EU-approved, specialised, and

competitive Tonnage Tax (TT) System, which applies to shipowners,

charterers and ship managers, providing long-term fiscal stability. In

parallel, Cyprus offers high quality maritime services, a professional

and multilingual workforce and a responsive regulatory framework

shaped by strong public-private partnership. Together, these

elements form an attractive and competitive shipping cluster that

continues to inspire international trust, attract investment and

strengthen Cyprus’ image on the world stage.

Looking to the future, Cyprus is well positioned to build on these

solid foundations and capture emerging opportunities. Areas such

as the green transition, digitalisation and technology in maritime

represent significant potential for growth. In addition, the potential

development of Cyprus’ natural gas resources offers promising

opportunities for the shipping sector, including energy transport,

offshore logistics and related maritime infrastructure. Taken

together, these developments open up important new avenues for

investment, innovation and future growth, further consolidating

Cyprus’ strategic position in the Eastern Mediterranean and beyond.

24


Maritime & Shipping

INSIGHT

CEO, Invest Cyprus

Marios

Tannousis

From an investment promotion

perspective, how does the Cyprus

shipping sector strengthen the

country’s global competitiveness

and create opportunities for

international investors?

The Cyprus shipping sector plays a vital role in strengthening

the country’s global competitiveness, while it constitutes an

attractive gateway for international investors. Its strategic location

at the crossroads of Europe, Asia, and Africa ensures direct access

to major markets, supported by a favourable time zone for seamless

global operations. This is complemented by a competitive tonnage tax

regime, offering predictability and stability for companies planning

long-term investments.

Beyond fiscal advantages, Cyprus has built a strong maritime

ecosystem with more than 250 companies covering the full spectrum

of shipping activities, supported by a government committed to

maintaining a business-friendly environment. Initiatives such as the

One-Stop Shipping Centre streamline processes and ensure efficient,

high-quality services, and a revised set of green incentives that

reward shipowners who achieve tangible reductions in greenhouse

gas emissions – these include a reduction of up to 30% on annual

tonnage tax. The sector’s resilience and consistent growth further

underline its investment appeal. Between 2023 and 2025, the Cyprus

Ship Registry expanded by almost 20% in gross tonnage, while

registrations under the Cyprus Tonnage Tax System rose by 15%.

Revenue from shipmanagement alone reached €918 million in the

second half of 2024, representing 5.3% of Cyprus’ GDP and marking a

27% year-on-year increase.

At the same time, Cyprus is investing decisively in innovation,

sustainability, and digital transformation. Combined with its strong

international standing, including continuous election to the IMO

Council since 1987, contributing over 7% to the country’s GDP and

generating thousands of high-level jobs, Cyprus shipping offers a

stable, forward-looking, and supportive framework for investors

seeking both financial returns and alignment with the global green

and digital transition.

25


Maritime & Shipping

INCENTIVES

Attracting Non-EU Business

Cyprus has a robust action plan to attract foreign businesses

to establish or expand their activities on the island. Cyprus

already provides many competitive advantages, but this set

of incentives aims to ramp up the number of companies

establishing headquarters on the island. The plan has considered

the best practices from other European countries, with emphasis

on domains related to technology, shipping, innovation,

research and development, pharmaceuticals, biogenetics and

biotechnology, and tertiary education, without excluding any

other companies that choose Cyprus as their place of business.

The new strategy which aims to promote foreign investment and

stimulate economic activity was implemented in January 2022.

THE BUSINESS SUPPORT CENTER

The Business Support Center (BSC) commenced its operation in May 2025 and

is the first point of contact for investors wishing to do business or expand their

business activities in Cyprus.

The operation of the BSC was approved by the Council of Ministers in March

2025 and comes to meet an essential need of the business community, enhancing

the competitiveness and growth of the economy. It is the continuation of the

successful Business Facilitation Unit which, itself, took the reigns from the Fast

Track Business Activation Mechanism in 2021.

26


Maritime & Shipping

The BSC is a partnership of key services, with the aim of providing a more direct,

efficient and coordinated service to Cypriot and foreign investors, as the new

Centre will operate as a common service provider and will consist of:

• the Strategic Development Sector (SDS) of the Department

of Town Planning and Housing (DTP&H)

• the Business Facilitation Unit (BFU) of the Ministry

of Energy, Commerce and Industry

• Invest Cyprus

• contact points with the departments involved in the licensing sector

BUSINESS SUPPORT CENTER SERVICES

1. Information and Personalised Guidance

• Point of contact regarding the establishment and licensing of businesses,

tailored to the type and needs of each investment

• Guidance and information on required permits as well as the possibility of

inclusion in the fast-track licensing mechanism, based on the provisions of

the Law on the Facilitation of Strategic Development Projects

• Assistance with registration in the Registrar of Companies and Intellectual

Property, Employers’ Register of the Social Insurance Services, and Tax

Department Registers

2. Registration in the Register of Companies with Foreign Interests

• Processing of electronic applications for registration in the Register of

Companies with Foreign Interests

• Upon registration, companies are eligible to take advantage of incentives for

employing third-country nationals

3. Single Point for Energy Projects

• Provision of information and facilitation of the licensing procedures for

projects related to renewable energy sources, energy storage, zero-emission

technologies, critical electricity transmission infrastructure, and projects

funded by European or state programmes

• Information on funding opportunities

• Operation of the Digital One-Stop Shop online platform

• Information point for Energy Communities

4. One-Stop Service Center [Point of Single Contact (PSC) Cyprus]

• Support and guidance for the establishment and operation of businesses in

the services sector

• Guidance for the creation of businesses in the services sector

• Cross-border provision of services on a temporary basis

5. Licensing of Strategic Development Projects, in accordance

with the provisions of the Law on the Facilitation of

Strategic Development Projects (Law No. 84(I)/2023).

27


Maritime & Shipping

RESIDENCE AND EMPLOYMENT PERMITS TO HIGHLY PAID THIRD-

COUNTRY NATIONALS AND SUPPORTING STAFF

The government has revised the policy for the employment of highly paid

personnel from third countries employed by companies of foreign interests,

as well as for those employed by Cypriot companies which give added value to the

economy and the local workforce.

ELIGIBLE COMPANIES:

• companies operating in Cyprus and are of foreign interest/shareholding and

maintain fully-fledged offices

• public companies registered on any recognised stock exchange

• Cyprus shipping companies

• Cyprus companies involved in innovation and technology

• Cyprus pharmaceutical companies or companies that operate in the fields of

biogenetics or biotechnology

• Cyprus Private Institutions of Tertiary (Higher) Education

ELIGIBLE COMPANIES CAN EMPLOY HIGHLY PAID THIRD-COUNTRY

NATIONALS IN KEY POSITIONS IF THE FOLLOWING CRITERIA IS MET:

• a minimum monthly gross salary of €2,500

• candidate must hold a university degree or equivalent, or have a minimum 2

years’ relevant experience

• minimum two-year contract

All companies under the Strategy commit to invest 30% of their total staff in

Cypriots/EU citizens over a period of five years. In five years from the date of the

enforcement of the Strategy, that is after 2.1.2027, the ratio for new hires will be

checked. If a company does not adhere to the 70:30 ratio, cases will be evaluated

on their own merits.

Eligible companies will also be allowed to employ third-country nationals as

support staff with a gross monthly salary of less than €2,500. The employment

of third-country nationals as support staff is allowed, provided that it does

not exceed 30% of the total support staff and provided that the third-country

nationals and the employers have

entered into an employment contract

Wargaming Headquarters, Nicosia

approved by the relevant authority, the

Department of Labour, in accordance

with the applicable law. The amount of

their salary is to be determined by the

current legislation.

BENEFITS FOR THIRD

COUNTRY NATIONALS:

• work permits will be issued within

a one-month period and will be

valid for up to three years

• a work permit can also be granted

to the spouse of the eligible

individual that obtains a visa

with this scheme, under a family

reunification permit.

28

CYPRUS

A Reliable International

Business Centre

• Strategic location at the crossroad of Europe, Asia and Africa

• EU and Eurozone Member State

• Low cost of doing business for high-quality professional services

• Modern and transparent legal and regulatory framework

• Extensive network of Double Tax Treaties

• Attractive corporate tax environment

• Strong business support services

• Highly educated workforce

• High quality of life

ts@meci.gov.cy

www.meci.gov.cy


Maritime & Shipping

CASE STUDY

THREE-STEP PROCEDURE TO REGISTER AN ENTITY, ENTER

THE FOREIGN INTERESTS COMPANIES REGISTER AND

EMPLOY THIRD-COUNTRY HIGH SKILLED PERSONNEL

Company registration in Cyprus is simple and efficient. This is an

example of the required steps for a simple and straightforward

set up in Cyprus for a small or medium sized company.

THREE EASY STEPS:

1REGISTRATION OF THE COMPANY

Registration must be done at the

Department of Registrar of Companies

and Intellectual Property. It is advised

to seek professional advice and once your

lawyer has filed for registration, it can

be expedited and completed in one (1)

business day. The administrative cost is

€465, lawyer’s or administrative service

provider’s fees not included. Breakdown

of registration fees, typical example for

a Private Limited Liability Company:

€165 registration fee + €100 accelerated

procedure + €200 company’s full set of

certificates by accelerated procedure.

2SUBMIT AN

E-APPLICATION

An online

application

form must be

submitted supported

by a ‘Letter of

Intent’ and other

relevant documents

required to register

the company as a

Company with Foreign

Interests. This takes

no more than ten

(10) business days.

3VISIT THE CIVIL REGISTRY & MIGRATION DEPARTMENT

FOR OBTAINING PERMITS FOR THE EMPLOYEES

Finally, you must prepare the documentation and go through the

application procedure to register the company’s employees with the

Migration Department (MD). For registration of the first employees of new

companies registered as Companies with Foreign Interests by the Business

Facilitation Unit, service at the MD will be on a first come, first served basis,

without an appointment. For the rest of the applications, predetermined

fixed weekly appointments for specific providers have been set, based on

volume and frequency of applications submitted. In such appointments, it

is expected that approximately 3-5 applications may be submitted. Smaller

offices and individuals will be served daily on a first-come, first-served

basis, without an appointment. In such cases, it is expected that no more

than 3 applications are submitted. Applicable fees per case can be found

on the website of the MD and do not exceed €150 per employee, lawyer’s

or administrative service provider’s fees not included. The residence

permit of the employee for temporary residence and employment takes

approximately 40 days to be issued, in the case of a positive review.

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Maritime & Shipping

FAMILY REUNIFICATION RIGHTS

Family reunification rights are granted to third-country nationals employed

by this revised policy. Direct and free access to paid employment (excluding

self employment) is granted to spouses of the third-country nationals who have

obtained a residence and employment permit in Cyprus, through this revised

policy and who receive a minimum gross monthly salary of €2,500. This right does

not extend to supporting staff who receive a monthly salary of less than €2,500.

DIGITAL NOMAD VISA

Significantly, the new Action Plan provides for the introduction and the issuing

of Digital Nomad Visas with a maximum initial limit of 500 beneficiaries.

WHO IS ELIGIBLE:

Third-country nationals who are either self-employed or employees who work

remotely using information and communication technologies to communicate

with their clients or employers who must be outside Cyprus.

WHAT RIGHTS DO YOU GET:

• right to stay in the country for up to one year, with the right to renew their

visas for another two years

• can be accompanied by family members, to whom a residence permit is

granted upon request, which will expire at the same time as that of the main

applicant

• during their stay in Cyprus, the spouse or partner and the minor members of

the main applicant’s family are not allowed to engage in any kind of economic

activity in the country

WHAT ARE THE CONDITIONS:

• must show evidence of sufficient resources at a fixed income level of a

minimum €3,500/month to cover living expenses during their stay without

burdening the national welfare system (the amount is increased by 20% in

case they have a spouse/partner and another 15% per child)

• must have a clean criminal record and healthcare insurance coverage

• the aforementioned prerequisites are indicative and additional requirements

are applicable

In the event that the holders of Digital Nomad Visas reside in the Republic for one

or more periods that cumulatively exceed 183 days, within the same tax year, they

are considered tax residents of Cyprus provided that they are not tax residents in

any other state.

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Maritime & Shipping

TAX INCENTIVES

The incentives also include the introduction of new tax benefits and tax breaks.

BROADENING TAX INCENTIVES:

• a 50% tax exemption to be granted to new and existing employees relocating/

relocated to Cyprus with employment remuneration of €55,000 and above

(with the requirement that they were not Cyprus residents during the

previous 10 years)

• beneficiaries of this tax benefit should be entitled to this benefit for a period

of 17 years from the year of employment

TAX EXEMPTION EXTENSION FOR INVESTMENTS IN INNOVATIVE COMPANIES:

• extension of the 50% tax exemption for equity investment in certified

innovative companies to corporate investors

INCREASED (COMPARED TO THE REAL) TAX DEDUCTION FOR

RESEARCH AND DEVELOPMENT EXPENDITURE:

• granting an increased discount on research and development expenditure

(e.g., by 20%). Eligible research and development expenses will be deducted

from taxable income at 120% of actual expenses

NATURALISATION

As of 19 December 2023, the Civil Registry (Amendment) Law of 2023 has come

into force, according to the provisions of which adult individuals intending

to apply for Cypriot citizenship by naturalisation must cumulatively meet a set

of qualifications. For comprehensive information please view the Application for

Obtaining Cypriot Citizenship by Naturalisation. n

View from 360, Cyfield

32


Maritime & Shipping

BUSINESS OPERATING ENVIRONMENT

DOING

BUSINESS

INCYPRUS

€

Cyprus’ business-friendly infrastructure and

can-do attitude has brought it worldwide

recognition as an international business

centre. The country offers a winning package

for both international entrepreneurs and

investors with its sophisticated business

environment, highly skilled workforce and

cost-effective, yet high quality of life.

33


Maritime & Shipping

BUSINESS CULTURE

Respect, hospitality and personal trust are the cornerstones of the Cypriot

business environment. An island nation with a long history of dealing with

foreign traders and businesses, Cypriot businesspeople are international in

their outlook and astute and knowledgeable in their negotiations. Punctuality

is expected, business dress is formal for both men and women, especially at

the beginning of a business relationship, and even in warm weather. Most

Cypriots prefer face-to-face meetings to telephone conferences or written

communications, which are regarded as too impersonal, and place great

importance on building personal relationships with business partners or

connections. Trust is the key to successful business dealings in Cyprus.

LANGUAGE

Greek and Turkish are the official languages of Cyprus. However, English, the

legacy of the British who ruled Cyprus from 1878 to 1960, is widely spoken

and is the language of international business. Many Cypriots also speak French,

German or Russian.

BUSINESS HOURS

O

ffice hours are generally 8.30am to 1.00pm and 2.00pm to 5.30pm, Monday

to Friday. Although in summer some offices take a longer lunch break or

finish early.

34


Maritime & Shipping

BUSINESS COSTS

An EU base within the eurozone, Cyprus remains one of the few international

business centres offering low operational costs and a high standard of living.

Office space and residential property in Nicosia, the capital and major business

centre, is relatively inexpensive when compared to other European capitals.

In terms of cost of living, Cyprus remains one of the most advantageous places

to live, with cost of living lower than in most Western European countries. At the

same time, residents of Cyprus enjoy a high standard of living and exceptional

quality of life, as the balmy climate and low crime rate offer both comfort and

peace of mind.

Business Costs Cyprus EU27 Average

Labour (business sector) €21.00 €33.50

Communications (services & equipment)* 110.70 100

Electricity (households) €0.2084/kWh €0.2151/kWh

Electricity (non-households) €0.1505/kWh €0.1829/kWh

* EU average was set to equal 100 points for benchmark year 2019. Source: Eurostat (2024)

COMMERCIAL AND RESIDENTIAL PROPERTY

Limassol Marina

Cyprus offers a full range of properties for both commercial and residential

use situated in key locations across the island. While the exclusive, top-level

market is currently the most sought after, the island has a good stock of properties

available, from townhouses and apartments, to villas and seaside bungalows in

five-star gated developments. Nicosia and Limassol are the main business centres.

Office space is available in purpose-built office blocks, in converted houses or

flats. A number of business centres also offer ready-to-move-into offices. They

usually include fully equipped offices that are available on demand with flexible

terms, meeting rooms and a receptionist service. Overall, rentals are around twothirds

of those charged for comparable commercial spaces in continental Europe,

and offices, retail or other commercial space is widely available for purchase or

for rent.

35


Maritime & Shipping

COMPARISON OF ESTIMATED AVERAGE RENT LEVELS

FOR FLATS, 2023 (BRUSSELS = 100)

300

European

Union

200

100

0

249

199

188

181

168

149

148

133

131

128

125

123

122

121

116

112

Dublin

Copenhagen

Luxembourg

Paris

Stockholm

Munich

Helsinki

Madrid

Lisbon

Berlin

The Hague

Prague

Budapest

Vienna

Tallinn

Vilnius

Ljubljana

Valletta

Lyon

Brussels

Zagreb

Athens

Rome

Warsaw

Karlsruhe

Bonn

Bratislava

Riga

Bucharest

Varese

Nicosia

Sofia

108

107

103

100

99

99

97

92

91

89

87

81

75

67

67

52

Note: Rents in currencies other than the Euro were converted to Euros by means of the exchange rates at 1

July 2023. Source: Eurostat.

OFFICE SPACE

In terms of office rental and sales prices, Limassol continues to be the most

expensive region followed by Nicosia, Larnaca, Paphos and Famagusta

respectively.

OFFICE SALE AND RENTAL PRICES PER CITY (Q1/2024)

Sale Prices (per m 2 ) Rental Prices (per m 2 )

Famagusta €2,000 - €2,500 €10 - €15

Larnaca €2,500 - €3,500 €15 - €20

Limassol €5,000 - €6,000 €25 - €50

Nicosia €3,000 - €4,500 €15 - €30

Paphos €2,000 - €2,500 €10 - €15

Source: Danos International Property Consultants

HUMAN RESOURCES

Well-trained and versatile, the Cypriot workforce is one of the island’s most

valuable resources, offering high standards of productivity, technical

expertise and professional excellence at reasonable costs to businesses.

According to the Statistical Service in Cyprus, the country records the most

higher education graduates per capita (age 30-34) in the European Union.

The Cypriot labour force amounted to 528,981 persons or 65.4% of the

population (males 71.1%, females 60.0%) in Q2 of 2025. The biggest percentage of

employed persons were in services (81.2%), followed by manufacturing (16.6%)

and agriculture (2.2%). n

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Maritime & Shipping

SALARY SURVEY 2025 Source: GRS Recruitment

JOB TITLE LOW (€) MID (€) HIGH (€)

Management CEO 100,000 130,000 150,000

Executive Director 60,000 100,000 140,000

CFO 57,000 82,000 135,000

Accounting & Finance Financial Controller 50,000 65,000 70,000

Finance Manager/Senior Accountant 40,000 55,000 65,000

Accountant/Auditor (Qualified) 35,000 40,000 45,000

Accountant/Auditor (Part Qualified or QBE) 24,000 30,000 40,000

Account Assistant 19,400 24,000 28,000

HR Department Head of HR / Group HRM 70,000 80,000 90,000

HR Manager 36,000 48,000 60,000

HR Executive 22,000 27,500 40,000

Legal Deparment Head of Legal / Group Legal Head 65,000 100,000 140,000

Legal Advisor (Qualified Lawyer) 29,600 39,000 56,000

Legal Assistant / Paralegal / Non Qualified Lawyer 18,000 22,000 28,600

Compliance, Anti-Money Head of Compliance 57,000 72,000 90,000

Laudering (AML), Counter - Compliance/AML/CTF Manager 42,000 46,000 54,200

Terrorist Financing (CTF) Compliance/AML/CTF Officer 28,900 36,000 44,000

Dealing Room Chief Dealer 48,000 52,000 70,000

Dealer 24,000 33,000 42,000

Junior Dealer 17,000 20,000 22,000

IT Department Head of IT / CTO 65,000 78,700 140,000

IT Manager / Development Manager 53,500 65,000 78,200

Quality Assurance (QA) / Tester 23,800 36,700 49,000

IT Technician 23,000 29,000 36,000

Developer 30,000 42,000 59,000

Marketing Department Head of Marketing 50,000 72,000 90,000

Marketing Officer 24,000 30,000 39,000

Digital Marketing Specialist (Social, PPC/SEO) 28,000 36,000 42,000

Marketing Executive 22,000 25,600 29,000

Sales Department Head of Sales 43,400 55,000 60,700

FX Sales 24,000 28,000 36,000

Sales Executive (Industries other than FX/Fintech) 22,000 26,500 34,000

Administration Office Manager / Personal Assistant 24,000 34,000 40,000

Administrator / Receptionist 19,600 22,000 26,000

Corporate Administrator 24,000 33,000 36,000

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Maritime & Shipping

Tax and Regulatory

Regime of Cyprus

Cyprus offers one of the most attractive tax regimes in

Europe. A member of the European Union since 2004,

Cyprus’ regulatory regime is in full compliance with the

requirements of the EU and OECD. Cyprus has one of

the lowest EU corporate tax rates at 12.5%. The island’s

advantageous tax rate coupled with an extensive

list of double tax treaties places it high on the list of

preferred jurisdictions for international tax planners.

CORPORATION TAX

The Corporation Tax Rate in Cyprus is 12.5%.*

BASIS OF TAXATION

All companies that are tax residents of Cyprus are taxed on their income accrued

or derived from all sources in Cyprus and abroad. A non-Cyprus tax resident

company is taxed on income accrued or derived from a business activity which is

carried out through a permanent establishment in Cyprus and on certain income

arising from sources in Cyprus. A company is considered tax resident of Cyprus

if it is managed and controlled from Cyprus. As of 2023, a Cyprus incorporated

company is by default considered a tax resident of Cyprus provided it is not tax

resident in any other jurisdiction.

Trilogy, Limassol

*Legislative changes in progress to increase to 15% in line with OECD global minimum tax initiatives.

39


Maritime & Shipping

SPECIAL TYPES OF COMPANIES

SHIPPING COMPANIES

The Merchant Shipping Legislation, fully approved by the EU, provides for an

exemption from all direct taxes and taxation under the tonnage tax system. The

merchant shipping legislation applies to qualifying shipowners, charterers and

ship managers, which are involved with the operation of qualifying community

ships (ships under a CY flag or a flag of an EU member state or of a country in the

European Economic Area) and foreign (non-community) ships (under conditions)

and provided that they engage in qualifying activities. The legislation allows

non community vessels to enter the tonnage tax system provided the fleet is

composed by at least 60% community vessels. If this requirement is not met, then

non community vessels can still qualify if certain criteria are met. Exemption is

also given in relation to the salaries of officers and crew aboard a Cyprus ship.

INSURANCE COMPANIES

Profits of insurance companies are liable to corporation tax similar to all other

companies except in the case where the corporation tax payable on the taxable

profit of life insurance business is less than 1.5% of the gross premium. In this case

the difference is paid as an additional corporation tax.

THE CYPRUS ALTERNATIVE INVESTMENT FUNDS (AIFS) AND UNDERTAKINGS

FOR COLLECTIVE INVESTMENT IN TRANSFERABLE SECURITIES (UCITS)

Funds which are opaque for tax purposes, and which are managed and controlled

in Cyprus are tax resident in Cyprus and are subject to the general provisions of

the Cyprus tax framework. In the case of funds which have compartments, each

compartment is assessed separately for tax purposes subject to the provisions of

the law. Under circumstances and depending on the legal form of the fund, some

funds may be transparent for tax purposes.

ADMINISTRATION AND COMPLIANCE

Tax Year: The tax year is the calendar year. The accounts of a company may be

closed on a date different from 31st of December, in which case taxable profits

are time apportioned to the relevant tax years.

CONSOLIDATED RETURNS

T

axation on a consolidated basis is not permitted and each company is required

to submit a separate standalone tax return. A set-off of group losses is

possible provided there is at least 75% parent subsidiary relationship, including

subsidiaries under at least 75% control of a common parent company. Group loss

relief is available only between resident companies (and EU-based companies,

provided that they have exhausted all options to utilize the losses in their country

of residence).

40


Maritime & Shipping

FILING REQUIREMENTS:

Corporate tax returns must be filed electronically by the 31 st of March of the year

following the year under consideration (i.e. 15 months from the year-end).

Companies are required to pay provisional tax in two equal instalments by 31 st

of July and 31 st of December of the year under consideration. Any underpayment

is due to be settled via self-assessment by 1 st of August of the following year. If

the income declared for the payment of the provisional tax is lower than 75% of

the actual income as finally determined, an additional tax equal to 10% of the

difference between the final and provisional tax is payable.

PERSONAL INCOME TAX

BASIS OF TAXATION

All Cyprus tax residents are taxed in Cyprus on all income accrued or derived from

all sources in Cyprus and abroad such as employment income, rental income etc.

(i.e. worldwide income).

Individuals who are not tax residents of Cyprus are taxed on income accrued or

derived from sources in Cyprus.

An individual is tax resident in Cyprus if one of the following conditions are met:

a) he/she spends physically in Cyprus over 183 days during the relevant tax year;

or

b) he/she does not remain in any other state for one or more periods which

altogether exceed 183 days in the same tax year and he/she is not tax resident

in any other state for the same tax year and all the following conditions are

cumulatively met:

• he/she should remain in Cyprus for at least 60 days during the tax year

• he/she should pursue any business in Cyprus and/or to work in Cyprus and/

or to be a director in a company tax resident in Cyprus at any time during

the tax year

• he/she should maintain a permanent residence in Cyprus, which can be

either owned or rented.

The personal income tax rates that apply to individuals are as follows:

Taxable Income Tax Rate (%) Tax (€) Accumulated Tax (€)

0-19,500 0 0 0

19,501- 28,000 20 1,700 1,700

28,001-36,300 25 2,075 3,775

36,301-60,000 30 7,110 10,885

Over 60,000 35

Foreign pension income is taxed at the flat rate of 5% on amounts over €3,420. The

taxpayer can however on an annual basis elect to be taxed at the normal tax rates

and bands set out above.

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Maritime & Shipping

TAX INCENTIVES FOR EMPLOYEES TAKING UP EMPLOYMENT IN CYPRUS

a) The individuals who were non-Cypriot tax residents prior to the

commencement of their employment, but become Cypriot tax residents

afterwards, are eligible for a 50% exemption from income tax if all the

following conditions are met:

• their remuneration from the employment exercised in Cyprus is over

€55,000 per annum; and

• they were not tax residents of Cyprus for 15 (or 10 – subject to conditions)

consecutive years prior to the commencement of their employment.

The exemption is granted from the first year of employment and it can be

enjoyed for a period of 17 years.

b) Individuals with annual remuneration below €55,000 who were non-Cypriot

tax residents in the 3 years preceding their employment, are eligible for a 20%

exemption from income tax (maximum exempt amount is €8,550 per year).

The exemption is available from the 1 st of January following the year of

commencement of the employment and can be enjoyed for a period of 7

years.

c) Exemption of the remuneration from the rendering of salaried services

outside Cyprus to a non-resident employer, or to a permanent establishment

outside Cyprus of a resident employer, for an aggregate period in the year of

assessment of more than 90 days.

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Maritime & Shipping

SUBMISSION OF TAX RETURNS

The tax year is the calendar year. Tax on employment income is withheld by the

employer under the PAYE system and remitted to the tax authorities.

Self-employed individuals pay tax through the provisional and self-assessment

systems. Tax returns must be filed electronically by 31st of July following the

tax year for employees and 31st of March of the year following the year under

consideration (i.e. 15 months from the year-end) for self-employed persons whose

returns are accompanied by audited/reviewed financial statements.

Sole proprietors with an annual turnover of more than €70,000 are obliged to

prepare financial statements that are either audited or are subject to a limited

assurance review by a statutory auditor (the latter in case their annual turnover

and certain other sources of income do not exceed the amount of €200,000 and

the total value of the assets without deducting liabilities does not exceed the

amount of €500,000, for at least two consecutive years).

Limassol Seafront

VALUE ADDED TAX

Imposition of Value Added Tax (VAT) is imposed on the supply of all goods and

services in Cyprus, on the acquisition of goods from other Member States and

on the importation of goods from third countries. The standard rate of 19% applies

to the supplies of all goods and services in Cyprus which are not subject to the

zero rate, the reduced rates (3%, 5% and 9%) or are not exempt. Cyprus constitutes

an attractive EU VAT jurisdiction applying several options permissible by the EU

Directive, among others, a flexible VAT Grouping. As long as the pre-requisite

links are satisfied, and governmental revenues are not put into jeopardy, related

entities can form a VAT group disregarding intra-group transactions and having a

representative member submitting a single VAT return.

SPECIAL CONTRIBUTION FOR DEFENCE

Special contribution for defence (SDC) is imposed on the dividend, interest and

rental income earned by Cypriot tax resident and domiciled individuals. Nondomiciled

Cypriot tax residents are exempt from SDC. n

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Maritime & Shipping

KEY FEATURES OF THE CYPRUS TAX SYSTEM

Simple, transparent and EU harmonised tax system

following recommended OECD practices.

Enjoys the tax benefits of EU Directives (Parent – Subsidiary

Directive, Merger Directive and Interest and Royalties Directive).

Extensive Tax Treaty network with 68 countries.

One of the lowest corporate tax rates in the EU with

possibility to enjoy a much lower effective tax rate.

Availability of a Notional Interest Deduction for companies

receiving new equity funding. The tax deduction can reach up

to 80% of the taxable income generated by the new equity.

IP Box regime based on the nexus approach which allows 80% deemed

deduction on qualifying profits from the business use of qualifying IP.

Increased deduction of 20% on the actual expenditure incurred for scientific

research as well as research and development, subject to conditions.

Attractive Tonnage Tax (TT) regime for ship owners, managers and charterers.

Attractive tax jurisdiction for funds and attractive

tax regime for fund managers.

Capital gains are exempt from tax (except for capital gains arising

from the disposal of immovable property located in Cyprus).

Profits of a foreign Permanent Establishment

exempt from tax, subject to conditions.

Gains from trading in securities (shares, bonds and certain

other financial instruments) are exempt from tax.

Unilateral credit relief for foreign taxes.

No withholding tax on dividend, interest or royalty payments (for

use of royalties outside of Cyprus) made abroad, unless these are

made to EU blacklisted jurisdictions (relevant conditions apply).

No taxes on qualifying reorganisations.

Carry forward of tax losses for five years.

Tax incentives for expatriate employees taking up

employment in Cyprus (20%/50% exemption).

Dividend income and passive interest income are exempt

from SDC for non-domiciled individuals taking up tax

residency in Cyprus (eligibility for 17 years).

Possibility to obtain Cyprus tax residency by spending

only 60 days in Cyprus (subject to conditions).

No inheritance tax.

No immovable property tax.

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Maritime & Shipping

WHO’S

WHO

CYPRUS BUSINESS DIRECTORY

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-

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-

-

Accounting

Agriculture, Forestry & Fishing

Associations & Organisations

Auditing & Assurance

Banking

Business Research

-

Capital Markets

The definitive

guide to Cyprus’

leading companies,

professional advisors,

government bodies

and industry

organisations.

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-

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-

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Communications

Construction

Consulting

Corporate Services

Education & Research

46


Maritime & Shipping

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Energy & Environment

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Media & Marketing

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Financial Services

-

Metals & Mining

-

Food & Beverage

-

Property & Real Estate

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Government

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Regulation & Supervision

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Healthcare

-

Retail & Consumer Goods

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Hospitality

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Ship & Yacht Registration

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HR & Recruitment

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Tax Planning

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Insurance

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Technology

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Investment Services

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Telecommunications

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Law Firms

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Transportation & Logistics

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Management Consulting

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Trust & Fiduciary Services

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Manufacturing & Industry

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Utilities

47

2025 Cyprus Shipping Guide

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