Cyprus Self Employed Person - Quick Summary

SELF EMPLOYED PERSONS

SELF EMPLOYED PERSONS

Characteristics

• Are taxed on profits, not turnover
• Expenses incurred for the running of the business are tax allowable (deducted for tax purposes)
• Are taxed on the PAYE tax brackets of the employed persons
• When their turnover exceeds Euro 70,000 annually, audited financial statements must be prepared just like companies
• Must be VAT registered and follow VAT rules and regulations
• Can register as employers and be responsible personally for their staff payroll taxes, just like companies 
• Are frequently scrutinized by the VAT and Income Tax offices (more often than companies)
• Are personally liable to VAT and Income Tax offices (unlike companies)

Our Advice

• The legal framework should outweigh the minor tax benefits when deciding whether to incorporate a company.
• Avoid been a self-employed person with employees.
• Always consult with an expert before you make any decision