North Cyprus is situated in the Mediterranean in a unique location with close proximity to all European, Asian and African continents. It borders Republic of Cyprus in the south which is an EU member state and in the North, Turkey is about 70 km away. Thanks to this ideal position North Cyprus offers great access to several important markets: Turkey, the Middle East and the EU.
By setting up a company in the North Cyprus you also take advantage of several tax benefits unique to the country as well as utilising the market potential of both the EU and the Middle East.
- The effective rate of corporation tax is 23.5 % (this , in practice, is 15% income tax deducted at source and an additional 10% Corporation Tax on the remaining amount). No withholding tax for dividends paid to shareholders
- 20% of revenue from goods exported outside of North Cyprus is tax exempt
- Free Trade Zone Companies : Exempt from value-added tax and corporation tax
- Offshore companies: Exempt from value-added tax and 1% corporation tax rate is applied
Money and Banking
The official currency of North Cyprus is the Turkish Lira. However, Euros and British Pounds are very widely used and any foreign currency can be used in transactions and contracts.
There is a strong banking system in Northern Cyprus which is overseen by the independent institution of North Cyprus Central Bank. Banks are free to keep foreign currency, accept foreign currency savings and engage in purchase and sale of foreign currenc
The Companies Law in North Cyprus is very similar to the Companies Act 1948 of the UK and hence offers an easy-to-understand framework for doing business in North Cyprus.
North Cyprus is famous for its premise of “at least 300 sunny days within a single year”. Therefore, as well as the financial attractiveness of the destination, it sure is one of the most pleasant countries to do business in.
The laid back attitude of the Cypriot people, their famous hospitality and respect for others offer an ideal climate to set up and run a successful business in North Cyprus.