The Cyprus Intellectual Property Tax Regime

If you are a business owner looking to protect your intellectual property, The Cyprus Intellectual Property Tax Regime may be the perfect place for you! This unique tax regime offers several benefits to business owners, including the ability to protect your intellectual property cost-effectively. This article will discuss The Cyprus Intellectual Property Tax Regime in more detail and explain why it may be the right choice for you.

What Is Included In This IP Tax Regime?

As a digital entrepreneur, you can enjoy the benefits of a flat 20% corporate tax rate on income that derives from IP assets. It means that if your company owns trademarks, patents, or copyrights which generate revenue for your business, then you will be able to benefit from The Cyprus Intellectual Property Tax Regime by paying only 20% of the relevant profits as taxes.

In addition, there is no withholding tax on dividends paid to non-resident shareholders. It makes Cyprus an attractive destination for holding IP-based companies and their profits. Finally, the full range of EU Directives and Regulations concerning intellectual property are fully implemented in Cyprus, ensuring that you will operate in a fully compliant manner.

While there had been revisions in 2018 and 2019, the government of Cyprus is now offering another incentive for IP owners. This time the purpose is to further boost investment activities by providing a special 80% tax deduction on all qualifying profits.

It means that if you own an intangible asset such as a trademark, patent, or copyright that generates income for your business, then you will be able to pay only 20% of the relevant profits as taxes.

What Are The Benefits To Your Business?

Tax savings for business owners means more money to reinvest in your business and your employees. It makes the tax regime attractive for companies that want to establish a presence in Cyprus or already have a business here. Since this new regime adopts the Nexus approach, you are only taxed on income derived from or connected with Cyprus.

The new regime also allows for patent box benefits and capital gains exemptions which are highly beneficial to intellectual property owners. In addition, there is an exemption from withholding taxes on payments made by Cypriot companies to non-resident companies to use the intellectual property.

The regime also provides for tax incentives regarding research and development activities. Additionally, there is an exemption from withholding taxes on dividends paid to a parent company that holds more than 50% of the share capital in its subsidiary based in Cyprus. Other incentives are included in the regime, such as an exemption on transferring assets to a permanent establishment (business location) in Cyprus.

How Can It Help Protect Foreign Investors Who Plan To Move Their Business In Cyprus?

The Cyprus Intellectual Property Tax Regime is an integral part of the country’s overall business infrastructure. It helps protect foreign investors who plan to move their businesses to Cyprus and encourages new investment in the country. The regime offers several benefits, including:

  • a generous tax deduction for all expenses incurred in connection with intellectual property protection;
  • the ability to offset any income generated from the licensing or sale of intellectual property against other taxable income;
  • a reduced tax rate on income derived from the exploitation of patents, trademarks, and designs; and
  • no withholding taxes on payments made for using or exploiting intellectual property rights.

These benefits make the Cyprus Intellectual Property Tax Regime desirable for businesses looking to protect their intellectual property. It allows companies to deduct all of the costs associated with protecting their IP, and it also offers a reduced rate of tax on income derived from its exploitation.

It makes Cyprus an ideal location for businesses to protect and exploit their intellectual property. The country’s robust business infrastructure and favorable tax regime make it the perfect place to do business.

Best Business Opportunities To Invest In Cyprus

Whether you want to move in or are planning to invest in Cyprus, there are a lot of business opportunities to choose from; this is because the country has a diverse economy and one that can sustain many different types of businesses. You should consider your interests or hobbies, what kind of industry appeals most to you, and your skillset.

The following are five of the best business opportunities to invest in Cyprus:

Real Estate

Real estate is always a lucrative investment, and it is no different in Cyprus. The country’s market has been growing steadily over the past few years, and there is still plenty of room for growth. In addition, Cyprus offers some great tax benefits that make it even more attractive to investors.

Tourism Industry

The tourism industry is another lucrative business opportunity in Cyprus. The country’s warm climate and beautiful scenery attract many tourists every year, making this sector very profitable for those interested in the hospitality industry or looking for a long-term investment.

To start your tourism-oriented business, you can set up shop in one of the many popular resorts and offer services such as transportation from nearby airports or other cities. You can also provide tour guides who speak English well enough to help visitors navigate their way around town without having trouble communicating with locals.


The pharmaceutical industry is a rapidly growing sector in Cyprus. With its robust healthcare system and favorable tax regime, the country has become an attractive destination for companies looking to establish or expand their operations in this field. In addition, many talented scientists and researchers call Cyprus home, so you’ll have access to some of the best minds in medicine when it comes time for research and development.

The pharmaceutical industry is also a lucrative business opportunity since many people need medication on an ongoing basis; if you open up shop here, you’ll be able to make money by selling your products directly without having any middleman involved.


The information technology sector is another business opportunity that is rapidly growing in Cyprus. The country’s vital infrastructure and favorable tax regime have made it a hotspot for companies looking to establish or expand their operations in this field, and many talented IT professionals call Cyprus home. In addition, there are plenty of tech startups that call this country home too.

Shipping and Logistics

The shipping and logistics industry is another business opportunity thriving in Cyprus for many years now. The country’s geographic location makes it an ideal place to shop. Its robust infrastructure and favorable tax regime have made it a hotspot for companies looking to establish or expand their operations in this field.

Final Words

Understanding the country’s tax regime is essential for those looking to do business in Cyprus. The good news is that the government has put in place several measures to make it easier for companies to get started, and there are plenty of online resources that can help you get started.