How to start a business in Cyprus from the UK

With a great location, ease of access, and very little in the way of language barriers, starting a business in Cyprus is an attractive option for many UK entrepreneurs. The process to start a business in Cyprus is also pretty frictionless, with plenty of local support on hand to help you navigate the steps successfully.

Join us as we walk through the process of setting up a business in Cyprus from the UK, and also introduce Wise Business which has accounts to hold, receive, send, spend and exchange GBP and EUR with mid-market exchange rates, and low, transparent fees¹.

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Doing business in Cyprus

We’ll get into how to start a business in Cyprus for foreigners in just a moment - first a quick look at why you might want to register a business in Cyprus.

Cyprus is in the EU, and uses the euro - but is not part of the Schengen agreement, making it a popular and easy place for UK citizens to visit as tourists. It’s also very attractive to European companies and multinationals looking for a location with a great quality of life and business friendly government. In turn, that makes it a great destination for UK business owners and entrepreneurs. They can gain easy access to the European market and even benefit from extra incentives if they’re in industries like pharmaceuticals, technology, R&D, shipping and innovation.

We’ll cover the process of setting up a business in Cyprus a little later - but it’s good to know that it’s a fairly easy and intuitive journey, and there’s support from both government agencies like Invest in Cyprus², and private legal firms on hand when you need it.

Cypriot company register

As in the UK, the first step you’ll need to take to start a business in Cyprus is to pick the company entity type that suits your needs. Here’s a look at the most popular types of business entities to allow you to start a business in Cyprus³:

• Private Limited Company by Shares
• Public Limited Liability Company by Shares
• Limited Liability Company by Guarantee without Share Capital
• Limited Liability Company by Guarantee with a Share Capital
• Variable Capital Investment Company

Let’s work through the most common business types in more detail, one by one.

Private Limited Company by Shares

A Cypriot private limited company by shares can have 1 to 50 shareholders, who have limited liability - meaning they’re only liable for the business up to the amount paid in the first place. This is the most common type of business in Cyprus. Shares are not openly traded or sold.

Public Limited Liability Company by Shares

A public limited liability company by shares must have at least 7 members, with a share capital requirement of just over 25,000 EUR in total. The liability of the shareholders is limited, and in this entity type, shares can be sold and traded to the public.

Limited Liability Company by Guarantee without Share Capital

In a limited liability company by guarantee without share capital, the owners are guarantors rather than shareholders. This means they don’t need to put up any share capital when the company is registered, but the shareholders must pledge an amount which is entered into the articles of association, and which will be paid if the company goes bankrupt with debts.

Limited Liability Company by Guarantee with a Share Capital

A limited liability company by guarantee with share capital can be either public or private, depending on the owner’s preference. Liability is limited to the amount paid into the share capital, or if specified when the company is founded, the amount pledged by guarantors.

Variable Capital Investment Company (VCIC)

A VCIC requires a licence in most cases before it can be registered. Licences are issued by the Cyprus Securities and Exchange Commission. In a VCIC the liability of shareholders is limited to their share capital, but the shares do not have a nominal value - instead, they have a variable value. The initial share capital needed for this business entity type varies a lot depending on the specifics of the business in question.

How to start a business in Cyprus - Step-by-step

The process to start a business in Cyprus is pretty simple, but as you’re obliged to have a local lawyer, you’ll need to find a trusted professional to help you prepare the documents needed. There are lots of legal firms and company formation specialists there to help you navigate the process.

Here’s an outline of what will happen⁴:

1. Choose a local lawyer to support you in the business registration process - only legal professionals licensed in Cyprus can draft the necessary documents
2. Register your business name - this can be done as an individual or via an agent
3. Submit all your paperwork to the business registry⁵ - this is usually done through your lawyer
4. Pay the registry fees - assuming everything is in order, your business is entered into the registry and you’re ready to start trading

The documents usually required can include:

• Memorandum and Articles of Association - signed and attested
• Names, addresses and ID for company directors and secretary (HE3 forms)
• Registered address of the company.
• Certified copies of company owner’s passport
• Owner references or bank statements to show good standing
• Declaration Forms (HE1 and HE2 forms)

Bear in mind that you’ll also need to have the required share capital which is based on the entity type you select - at the time of writing, this is 25,629 EUR for public companies. Once your company is registered you can set yourself up for tax, and also make sure you have a handy business account from a provider like Wise Business to let you hold, receive, exchange and send EUR conveniently. More on that later.

Setting up a business in Cyprus - FAQs

Let’s walk through a few more important questions about starting a business in Cyprus.

How much does it cost to register a company in Cyprus?

The main cost of registering a company in Cyprus is likely to be in legal and advisory fees - the government costs are negligible. While the state fees vary by company type, you’ll pay 165 EUR to register a company with share capital online⁶, for example - but as you’ll need a local lawyer to help you draft the paperwork to complete this process, you'll need to account for this cost as well.

Is Cyprus a good country in which to start a business?

Cyprus is a very popular company to start a business, with a great location and ease of access to the mainland European market. There are business friendly policies in place which can also be attractive, including incentives and support from government agencies like Invest in Cyprus.

Can a foreigner start a business in Cyprus?

Yes. There’s not usually any barrier to a foreigner starting a business in Cyprus. Some entity types do need a local director, so if you’re not resident in Cyprus you may need to consider this factor - but generally, starting a business in Cyprus from the UK is pretty easy to do, and can bring some great rewards.

Manage your Cypriot Company's finances with Wise Business

You’ll need easy ways to manage your company finances across EUR, GBP and more, once you launch your Cypriot business - Wise Business can help.

Wise Business accounts are available online or in the Wise app and let you hold and exchange GBP, EUR, USD and 40+ other currencies, with the mid-market exchange rate and low fees¹. You’ll get your own local account details for receiving GBP, EUR and more, as well as linked debit and expense cards, multi-user access, batch payments, and cloud accounting integrations - all with no ongoing fees to pay and no minimum balance requirement.

Check out how one business is making the most of Wise Business in this Open Collective case study.

Ready to learn more about how to open a Wise business account in the UK? Here’s a quick overview:

1. Download the Wise app or head to the Wise desktop site
2. Tap Register and follow the prompts to apply for a business account
3. Add your personal and contact information
4. Upload the documents needed which are detailed online and in this Wise Business account requirements guide
5. Pay the one time fee to register your account and get a linked payment card if you need one
6. Once your account is verified you can start transacting - your account will be live in the Wise app, your physical card will be posted to you, and you can get a digital card right away for mobile spending

Setting up a company in Cyprus is relatively straightforward, with lots of local help on hand, and English widely spoken. The process is pretty easy to understand, which means that along with your local lawyer, you can build your Cypriot business in a very short time. Use this guide to start your planning - and take a look at Wise Business to manage your business finances across pounds, euros and more, with mid-market rates and low fees.

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Sources used for this article:

Sources checked Apr 8, 2024