A high net worth individual or as commonly known a HNWI is a person with multiple income streams usually in various geographical locations (tax jurisdictions) and as a result a prospect client for tax planning services. Cyprus has introduced a very attractive tax incentive scheme called the "non dom" tax status specifically design for such persons. Other countries may have similar incentives and this is something we can examine on your behalf.
Cyprus Tax Incentives for HNWIs
In a nutshell, such a person can enjoy tax free dividends across the globe by staying in Cyprus for only 60 days and becoming a Cyprus Tax Resident. Like all tax incentives certain requirements and restrictions apply as follows:
Conditions for Cyprus Non Dom Tax Residents:
- They have not been living in Cyprus 17 out of the last 20 years in Cyprus (i.e they are not Cyprus domicile)
- And they have been staying in Cyprus at least 60 days (day in and out from Cyprus counts as a day of stay in Cyprus)
- And have not stayed more than 183 days in any other jurisdiction
- And are not tax residents anywhere else in the world
- And have defined Cyprus ties such as a Company or a business contact from Cyprus
Note: Origin of domicile is defined at birth and as a rule is the domicile of the father and in some rare instances / occasions of the mother.
Example of Eligibility
If you are a shareholder receiving large amounts of dividends in high tax jurisdiction and you travel a lot then you should consider the possibility of changing your tax residency as the tax benefits, savings of 0% dividend tax outweigh any possible inconvenience such as travelling to Cyprus for a few days which is a great opportunity to meet up with high level tax advisors and lawyers who can assist you with your existing and other business issues.
In addition as trading in securities is entirely tax free in Cyprus, tax free dividends and trades are perceived as irresistible benefits by a portion of our clients.
Cyprus first employment in the republic tax incentives appears to be extremely attractive to high income earners as remuneration exceeding Euro 100,000 enjoys a 50% personal income tax discount for the first 10 years of employment in the Republic of Cyprus.