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30 Int'l Bus. Law. 453 (2002)
Summary of New Tax Reforms in Cyprus Affecting International Business Companies

handle is hein.journals/ibl30 and id is 467 raw text is: Summary of New Tax Reforms in Cyprus Affecting International Business Companies Kypros Chrysostomides Dr K Chrysostomides & Co, Nicosia Legal entities and corporation tax From 2003, the distinction between IBCs and local companies is being abolished. The definition of a company resident in Cyprus will be introduced and such resident companies will be subject to tax in Cyprus. A legal entity is a 'resident of Cyprus' if its management and control are located in Cyprus. What is meant by 'management and control' is not defined in the law but it usually means the location where the decisions of the board of directors are taken. If the majority of the directors reside in Cyprus where the decisions are taken, the management and control test will be satisfied. Under the existing regulations, IBCs are liable to Cyprus income tax (at the reduced rate of 4.25 per cent) irrespective of where their management and control are exercised. Tax rates for IBCs For the financial year 2002 the tax rate for IBCs will continue to be 4.25 per cent as it has been in previous years. As from the financial year 2003, the taxable profits of all resident companies will be taxed at a rate of ten per cent except for those IJBCs which are eligible for the transitional provisions described below. IBCs already operating under the existing tax legislation concerning offshore companies (section 28A of the Income Tax Laws) may elect to continue International Business Lawyer November 2002 ro g 'n r6 i 6cg, d i ie- . 1, 60, S A, -.=-'AaX.OO!xr coiwerrie(l. whicti arebeing in'4'ro'c'-f d4z-C-A. in- i wbieli alf'oot intetF)ational bushwg CO i

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