In recent years, obtaining Cyprus citizenship has become particularly attractive for many successful Russians, and Cyprus is a "gateway to Europe". This island state is now the most popular country for Russians to move, as well as to obtain citizenship or residence permit as a "reserve airfield". And Russians are interested in both investment migration and moving on common grounds for people of average income. It's no secret that Oleg Deripaska, Alla Pugacheva and Maxim Galkin have become Cyprus passport holders. However, in addition to the starry Russians, businessmen, employees, pensioners, and young families with small children went to Cyprus to obtain Cyprus citizenship.
What attracts Russians to Cyprus so much? There are many reasons for that.
Cyprus citizenship is "The Window to Europe". Cyprus has been a member state of the European Union since 2004 and is part of the Eurozone. This gives people with a residence permit of Cyprus preferential conditions for obtaining visas to stay in Schengen countries.
Citizenship of Cyprus as a second. Cyprus is one of the few countries in Europe that allows its citizens to have a second citizenship. Thus, Russian citizens have the right to have Russian citizenship, as well as to obtain citizenship of Cyprus.
Lifestyle. Pleasant climate, blue flag beaches, Mediterranean cuisine, access to European social system and education, low crime rate and security of tenure, full ownership of real estate and low maintenance costs, friendliness and openness of Cypriots attract residents of Moscow and other Russian cities. All these citizens of Russia receive a residence permit and Cyprus citizenship.
Close cultural and religious ties. The island has long been a favorite place for Russians, and Limassol was dubbed "Russian city". Some compatriots, having lived more than 10 years in Cyprus, never learned Greek, as English and Russian languages are widespread. By the way, no one will test you for Greek to get a residence permit and Cyprus citizenship.
Cyprus is an Orthodox country, which is why some of our applicants give it more preference than Malta.
Close economic ties. Cyprus has an extensive network of double tax treaties with more than 40 countries, including Russia. This agreement provides the most promising tax planning opportunities compared to other agreements concluded by Russia. Only the UK, Luxembourg and the Netherlands can compete.
With Cyprus Citizenship, an attractive tax regime and high potential for investment is emerging. In light of recent developments in deofforization and automatic exchange of tax information, Russians are choosing countries with preferential tax treatment, primarily Cyprus. Legislation on controlled foreign companies (CFC) applies to tax residents of Russia. In case of change of tax residency, i.e. if you do not stay in Russia for more than 183 days for 12 consecutive months, the CIC legislation is no longer about you. Accordingly, obtaining a residence permit (residence permit) in Cyprus is again a way out of the situation.
Corporate tax is the lowest in the EU and is only 12.5%, making it very attractive for holders of a residence permit or citizenship in Cyprus to conduct their own business. Moreover, persons who have not been tax residents of Cyprus (have not resided in the country for more than 183 days per year) for the last 17 years out of 20 (persons with non dom status) are fully exempt from personal income tax as well as tax on dividends from Cyprus or any other company and passive interest income from bank deposits, Eurobonds issued by Russian issuers. For comparison, the total personal income tax rate in Russia today is 13% and it is planned to increase it to 15%.
For transactions with securities, a zero tax rate on capital gains is applicable. For persons with non-domic status there is a 50% exemption from taxation of income from employment if their salary exceeds €100,000 per year, a 20% exemption from taxation of remuneration from employment in Cyprus, or €8,550 (the lower of the amount) in respect of persons who were not tax residents of Cyprus before starting employment.
The property tax has been eliminated from 2017. There is a preferential VAT rate of 5% (standard rate is 19%) on the purchase of the first property for own residence.
The Government of Cyprus encourages the move to Cyprus of non-domiciled foreign nationals through the tax reform in 2015 and friendly amendments to the tax and immigration laws.
In this way, Cyprus will combine the pleasant with the useful - attractive lifestyle with reduced tax burden in one package. There is no better country to move to or "reserve airfield" for the future in case of instability in your home country or just a desire to move to a more pleasant climate, not to find!