By decision of the Council of Ministers of the Republic of Cyprus, 2014, investors can acquire the Cyprus Citizenship by Naturalization.
With over 20 years of experience in the industry, Auditnet can assist its clients in obtaining the Cyprus Citizenship, hassle-free, in an honest, professional and effective manner.
By obtaining a Permanent Resident Permit and/or Cyprus Citizenship by Exception does not alone affect the tax status of an individual. An individual is taxed according to residency and domicile status.
A Cyprus tax resident can benefit from a number of tax incentives some of which are:
On September 13 2016, the Council of Ministers in Cyprus approved the amendments to the Scheme for Naturalization of Investors in Cyprus by Exception. This scheme is based on subsection (2) of section 111A of the Civil Registry Laws of 2002-2015.
The amendments to the law were made by the Cyprus Government to encourage further Foreign Direct Investment in the island by high-net-worth individuals
A. Economic Criteria:
A non-Cypriot citizen who meets one of the following economic criteria (A) either personally or via a company in which he/she is a shareholder (in proportion to the holding percentage) or through investments made by his/her spouse either individually or jointly, or an individual who is a high-ranking manager of a company that meets at least one of the economic criteria (A), can apply to obtain Cypriot citizenship through Naturalization by Exception.
A high-ranking senior manager of a company can apply only if he/she receives remuneration that generates tax revenues of at least €100,000 in the Republic of Cyprus over a period of 3 years and provided that the tax has already been paid or will be prepaid.
The applicant must have made the necessary investments within 3 years before the date of the application and must hold the said investments for a period of not less than 3 years from the date of obtaining Naturalization.
The applicant must fulfill the requirements of the Terms and Condition as set out in Part B.
If, following periodic inspections it is discovered that the criteria and terms and conditions of the Scheme have been breached, then the granted Naturalization may be revoked.
A.1 Investing in Real Estate, Land Development and Infrastructure projects
The applicant must have made an investment of at least €2 million (plus VAT) for the purchase or construction of buildings or for the construction of other land development projects (either residential or commercial developments, or developments in the tourism industry) or other infrastructure projects.
Investing in land under development is permitted, provided that an investment plan for the development of the purchased land is included with the application. It is understood that investment in land situated in a building-zone of zero development is excluded.
A.2 Investing in Financial Assets of Cypriot Companies or in Cypriot Organizations
The applicant must have purchased or have participated in companies or organizations established and operating in the Republic of Cyprus with a total investment of not less than €2 million. These funds must be utilized towards the investment objectives of these companies exclusively in Cyprus based on a specific investment plan.
Applications will be assessed to verify that the companies or organizations have a proven physical presence in Cyprus, with significant activity and annual turnover and must employ at least five (5) Cypriot citizens or citizens of European Union member-states. The minimum number of employees required will increase if more than one applicant invests simultaneously or almost simultaneously in the same company or organization. The said employees must have legally resided in Cyprus continuously for the last five years before the date of the application.
A.3 Investing in Alternative Investment Funds or Financial Assets owned by Cypriot companies or Cypriot organizations licensed by CySec
The applicant must have bought units of at least €2 million from Alternative Investment Funds (AIF) established in the Republic of Cyprus, licensed and regulated by CySec and whose investments are made solely in the Republic of Cyprus in investments that meet the conditions of this Scheme or in areas approved by the Ministry of Finance.
The manager or auditor of the Fund shall confirm in writing to the Ministry of Finance and the Ministry of Interior that the investments meet the criteria of the current Scheme and will be kept for a minimum period of three years. The manager or auditor of the Fund will be required to report on the value of the initial investment an annual basis.
Under this criteria, investors can acquire financial assets (of Cypriot companies or organizations of at least €2 million), such as bonds, bills and securities issued with the approval of CySec by companies that have proven physical presence and substantial economic activity in the Republic of Cyprus and whose purpose is the financing of the specific investment plans of these companies or organizations exclusively in Cyprus.
Note that the purchase of units of other AID’s by an AIF is not permitted under this Scheme.
A.4 Combination of the above Investments
The applicant may submit an application to obtain Cypriot Citizenship by Exception on the basis of investments in combination of the above way, provided that the total investment will not be less than €2 million.
Under this condition (combination of investments) the applicant may also invest in special Government Bonds of the Republic of Cyprus for a sum up to €500,000. The bonds will be issued by the Public Debt Management Office of the Ministry of Finance and the investor must hold these bonds for a minimum period of three years. The characteristics and terms governing these special bonds will be stipulated by the General and Special Issue Terms of the Government Bonds of the Republic of Cyprus. Acquisition of Government Bonds through the secondary market will not be considered as eligible criteria for application to obtain Cypriot Citizenship by Exception.
1. Clean Criminal Record: The applicant must have a clean criminal record. The applicant’s name cannot be included in the list of persons whose assets have been frozen as a result of sanctions within the European Union.
2. Residence in the Republic of Cyprus: In all schemes listed in Part A, the applicant must own a permanent, privately-owned residence in the Republic of Cyprus with the purchase price of the property being at least €500,000 (plus V.A.T.).
Members of the same family, who submit a separate application as investors, can collectively obtain the residency if the total value of the property purchased will be equal to €500,000 per applicant.
If the purchase value of the permanent, privately-owned residence is greater than €500,000, then part of this additional sum can be used for supplementing the total amount of the investment as per the criteria of Part A.
Further, if the applicant has invested in real estate, land development and infrastructure projects as per criteria A.1, then it will not be necessary to purchase another permanent residence in Cyprus if one of the housing units purchased is worth not less than €500,000 (plus VAT) on the condition that the applicant holds this residence indefinitely.
3. Residence Permit in Cyprus: Prior to the submission of the application for Naturalization as a Cypriot Citizen, the applicant must hold a valid residence permit in Cyprus. If the applicant does not already hold a residence permit, then he/she can apply for an Immigration Permit as per Regulation 6 (2) of the Aliens and Immigration Law, at the same time as submission of application for Naturalization. If the application for obtaining an immigration permit is made only for the purpose of obtaining Cypriot citizenship in accordance with the provisions of this Scheme, then there are no other conditions other than those stated in Part A and Part B. This applies to all adult members of the member of the Investor’s family who will apply for Naturalization.
Note that if for whatever reason the application for Naturalization is rejected, then the Immigration Permit obtained in accordance with the provisions of this Scheme will also be revoked.
Should you decide to apply for Cypriot Citizenship or a Permanent Residence Permit, we will take care of every detail for you and you will not have to worry about anything!
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