Setting Up a Sole Trader in CyprusUpdated on Tuesday 15th November 2016
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Establishing a sole trader in Cyprus
Setting up a sole trader in Cyprus is the simplest form to start a business. Once an individual has obtained all necessary special permits and has informed the relevant authorities, he or she can start trading. It is quite simple to establish a sole proprietorship in Cyprus, but individuals deciding for this type of business must also know thy will be held fully liable for the business’ debts. They should also take into consideration the Cypriot income tax that can reach 30% for individuals.
Our law firm in Cyprus can help you choose the right type of business taking into account all their advantages and disadvantages.
The legal framework for establishing a sole proprietorship in Cyprus
The Cypriot sole trader is subject to the same regulations as the partnership. The main legal framework regulating sole traders is the Partnership and Business Names Law in the Cypriot Commercial Code. Just like partnerships, sole traders must register with the Cypriot Companies Registrar. The registration must be completed before starting operating. It must be taken into consideration that registration with the Trade Register must be made by lawyers in Cyprus.
One of the greatest advantages individuals from EU and EFTA (European Free Trade Association) countries have when setting up a sole trader in Cyprus is that they do not required a work or residence permit. Non-EU/EFTA citizens, however, are required to apply for work and residence permits before coming to Cyprus.
We invite businessmen to watch a short presentation on how to set up a sole trader in Cyprus.
Self-employment in Cyprus
Another form of having one’s own company is self-employment. Self-employment is used by small traders, among which sole traders and partnerships in Cyprus. Another category of self-employed individuals are freelancers, but unlike the others, freelancers can conclude contracts with Cypriot companies. Self-employed individuals and sole traders in Cyprus are allowed to trade name for their business. For sole traders and self-employed individuals there are no audit requirements if their annual turnover does not exceed 70,000 euros. However, they are required to register for taxation purposes and social insurance with the relevant authorities.
For complete details about all formalities that must be fulfilled for setting up a sole proprietorship you can contact our attorneys in Cyprus.