Starting a business in Cyprus: legal steps and key considerations

· ACP LEGALS

Cyprus is a practical base for local entrepreneurs and international groups alike. Setting up is straightforward when the main decisions are made early and the paperwork is in order.

1. Choose the structure

  • Private limited company: the most common choice. It limits the owners’ liability and is familiar to banks and investors.
  • Sole trader: simple, but the owner is personally liable.
  • General or limited partnership: for two or more people working together.
  • Branch of a foreign company: for an existing business that wants a presence in Cyprus without a new company.

2. Register the company

  1. Approval of the company name by the Registrar of Companies.
  2. Preparation of the memorandum and articles of association.
  3. Appointment of at least one director and a company secretary.
  4. A registered office address in Cyprus.
  5. Registration with the Tax Department and, where needed, for VAT.

With documents ready, formation often takes about 7 to 10 working days.

3. Tax and VAT

Cyprus reformed its tax system from 1 January 2026, and the corporate income tax rate is now 15%. VAT registration is required once taxable turnover passes €15,600 a year. Cyprus also has a wide network of double tax treaties. Rates and thresholds change, so we check the current position for each client before any decision.

4. Hiring staff

  • Written employment contracts setting out the main terms.
  • Registration with Social Insurance, with contributions shared by employer and employee.
  • Minimum wage rules and sector agreements where they apply.
  • Employee rights such as paid annual leave and protection on dismissal.

5. Common mistakes

  • Incomplete or untranslated documents.
  • Late registration with the tax authorities.
  • Starting a regulated activity (for example financial services, healthcare or tourism) without the licence it needs.
  • Employment contracts that do not meet Cyprus law.

Frequently asked questions

How long does it take to register a company in Cyprus?

Usually about 7 to 10 working days once the documents are ready.

When do I need to register for VAT?

When taxable turnover passes €15,600 in a year, and in some other cases, such as certain services received from abroad.

This article is general information about Cyprus law at the date of publication. It is not legal advice. Contact us about your own situation.