Holding Company in Cyprus

Holding Company in Cyprus in practice

A Cypriot private limited company (Ltd) is used as a holding company for EU subsidiaries, to hold intellectual property or for intra-group financing. For a Slovak business owner with one Slovak client and a short horizon, it makes little sense. The cost of a real presence in Cyprus, meaning an office, local directors and an accountant, often outweighs the tax benefit. A Slovak holding company can achieve the same result on a sale.

We start by comparing a Cypriot and a Slovak holding on your own figures. If Cyprus makes sense, we prepare a plan for real presence, coordinate setting up the Ltd with Cypriot lawyers and set transfer prices between the Slovak and Cypriot companies. On the Slovak side we check the CFC rules, DAC6 hallmarks and beneficial owner registration. Local partners handle the Cypriot part, while we run the project as a whole.

What we help with

Comparing a Cypriot and a Slovak holding company
Plan for real presence in Cyprus
Coordinating the Ltd set-up with Cypriot lawyers
Transfer pricing and licence agreements between Slovakia and Cyprus
Slovak side: CFC, DAC6, public sector partner register and related parties

Worth knowing

Real presence in Cyprus

The standard is a board with a majority of Cyprus-resident directors, the company's own office under a lease, board meetings held and minuted in Cyprus, and a Cypriot bank account and accountant.

CFC risk with an IP box

Preferential taxation of IP income can push the effective tax so low that the Slovak CFC rules in Section 17h apply. The answer is genuine economic activity and development work in Cyprus.

Transfer pricing

Transactions between the Slovak company and the Cypriot holding must be priced as between independent parties. Royalties need an analysis of an appropriate rate.

A Slovak holding as the alternative

A Slovak parent company does not pay tax on dividends received (Section 12(7)(c) of the Income Tax Act), and gains on selling a share are exempt under Section 13c for a holding of at least 10% kept for 24 months, with substantive functions in Slovakia.

Common questions

A standard holding with real presence usually will not. The risk rises with preferential IP taxation, where genuine economic activity in Cyprus is decisive. The assessment is always case by case.
For an owner with one Slovak client, over a short horizon, when you are not prepared to pay the annual cost of presence in Cyprus, or when the IP is developed only in Slovakia.
Yes. Incorporation, registered office, directors and bookkeeping in Cyprus are handled by Cypriot lawyers and corporate service providers. We coordinate the project and deal with the Slovak side.

Articles are in Slovak.

Preparing for the consultation

What to prepare for your consultation

Tick what you already have. You can print the list or save it as a PDF. Your ticks are remembered only in your browser.

For every matter

documents: contracts, decisions, demand letters, invoices
correspondence with the other party or the authority
a short timeline of what happened and when
the questions you want answered and what outcome you hope for

Also for this area

a Business Register extract and the articles of association
exactly what should change: director, registered office, shareholder, company name
identity documents of the people who will sign
contracts with partners that the matter concerns

0 of 8 ready

Discuss your matter with a lawyer

In a consultation we assess your situation, suggest a way forward and tell you what costs to expect.

€90 incl. VAT, 30 minutes, in person or online

This page is for general information, reflects Slovak law at the time of writing and is not a substitute for advice on your particular matter.

Holding Company in Cyprus