Cyprus Startup Visa 2025: A Gateway for Global Entrepreneurs to Thrive

Let’s face it—it’s not just about building a business; it’s about building a life.

In Cyprus, mornings start with coffee overlooking the Mediterranean, meetings flow between modern workspaces and seaside cafés, and connections are genuine—people shake your hand, look you in the eye, and remember your name. Evenings bring vibrant restaurants, fresh Mediterranean cuisine, and conversations that spark ideas.

The energy here is different. It’s not rushed, but it’s not idle either – it’s purposeful.

Cyprus isn’t just another business hub—it’s where global opportunities meet local warmth, and scaling a startup feels less like a grind and more like a fulfilling journey.

With the revised Cyprus Startup Visa Scheme, setting up your business here isn’t just an option—it’s an opportunity to thrive.

Below are the key changes, effective 1st January 2025.

1. Longer Residence Permits - More Time, Less Hassle

• Extended from 2 to 3 years: Founders and senior executives will initially receive a 3-year residence permit (up from 2-years).
• Renewals: Following the initial 3-year period, permits can now be renewed for an additional 2 years (up from 1 year).

Why it matters: This gives startups more time to establish themselves, hire talent, and scale up without frequent renewals.

2. Reduced Equity Requirements – More Flexibility for Founders

• Minimum equity stake lowered to 25%: The required shareholding in the company for each non-EU founder has decreased from 50% to 25%.
• Flexibility for multiple founders: Up to five founders, or one founder plus executive members, can apply as a team. 

Why it matters: Lower equity requirements are more flexible and open the door to more diverse founding teams without rigid ownership constraints.

3. More Freedom to Hire Global Talent

• Foreign workforce limit increased to 50%: Non-EU employees can now make up half of a startup’s total workforce (up from 30%).
• Additional hires for larger investments: If the startup invests at least €150,000 in Cyprus, it can recruit additional foreign personnel beyond the 50% threshold.

Why it matters: Startups with global ambition can hire the right talent, wherever they are from, to fuel the startup’s growth.

4. Clear and Fair Renewal Criteria

To renew the startup visa after the initial 3-year period, companies must demonstrate:

• A minimum 15% increase in revenue or investments of at least €150,000 during their operation in Cyprus.
• Creation of at least 3 new jobs in Cyprus or participation in a local innovation support scheme, or the launch of at least one product or service.

Why it matters: These criteria ensure a growth-driven, performance-focused renewal process designed to reward real progress.

5. Special Evaluation for Established Startups

Criteria for established startups: Those startups with an annual revenue of €1 million and R&D spending of at least 10% of their total operating costs in one of the last three years face a streamlined evaluation process.

Why it matters: Mature startups with proven success can fast-track their applications.

6. Tax Benefits - Beyond the Startup Visa.

Cyprus offers an extremely attractive tax regime. Here is a snapshot of both corporate tax and personal income tax benefits:

Corporate Tax:

• Corporate tax rate at 12.5% on worldwide income.
• All expenses incurred for the production of income are tax deductible.
• Dividend income is fully exempt from Tax*.
• Profit from the disposal of securities is exempt from Tax*.
• IP Box regime reduces income tax on royalties up to 2.5%.
• Profits from permanent establishment outside Cyprus are exempt from Income Tax*.
• Taxable losses are carried forward over five years.
• Group relief for utilisation of tax losses*.
• Dividends paid to foreign resident shareholders are free from Withholding taxes or any other taxes irrespective of a double tax treaty.
• Interest paid to a non-resident company is exempt from Withholding taxes irrespective of a double tax treaty.
• Notional interest deduction on new equity introduced (using the reference rate as the interest rate of the 10-year government bond yield of the country) where the new equity is invested (as published annually) increased by 5% (interest deduction is capped up to 80% of the taxable profits).
• Interest deduction incurred for the acquisition of fixed assets used in the business.
• Tax neutral on profit or losses arising from foreign exchange rate fluctuations.
• No thin capitalisation rules.
• Capital gains tax is only applicable on profit on disposal of immovable property or shares of non-listed entities owing immovable property situated in Cyprus.
• Double tax treaties have been concluded with 68 countries across all continents.
• Tax credit for foreign taxes.
• Cyprus tax authorities provide binding advance tax rulings.
• Full adoption of the EU Parent-Subsidiary Directive, EU Mergers Directive, EU Royalty and Interest Directive, EU Directive on Mutual Assistance and Cooperation.

*Subject to certain, non-stringent conditions

Income Tax for Individuals

• Dividend Income and Interest income are exempt from Income tax but are subject to Special Contribution for Defence Tax.
• 50% exemption is provided under Income tax on the remuneration from any employment exercised in the Republic by an individual who was a tax resident outside of the Republic before the commencement of the employment, provided that the annual remuneration exceeds the amount of EUR 55,000. The exemption applies for a period of 17 years.
•  Income tax exemption from foreign employment; remuneration from rendering services outside of Cyprus to a non-resident employer or to an overseas permanent establishment of a resident employer for more than 90 days in a tax year is exempt from income tax.
• No tax on any profits earned from the disposal of securities including shares and bonds.
• No tax on any lump sum received as a retirement gratuity.
• No tax on lump sum repayment from life insurance schemes or approved provident funds.
• 5% tax on pension received from abroad exceeding €3,420.
• No estate duty, wealth, gift or inheritance tax.
• Contributions to social insurance, GESY, approved provident and pension funds, medical or other approved funds are tax allowable (limited to the 1/5 of the net taxable income before these allowances).

Let’s Make it Happen.

If you’ve been dreaming about setting-up and scaling your startup in a vibrant, supportive ecosystem, there’s never been a better time to choose Cyprus.

Our team can assist you in navigating the Cyprus Startup Visa process and can offer end-to-end support – from company formation and IP protection to tax advice and residency applications. 

Contact Us today, and let’s start building your future together.

 

* This publication is intended as a general guide for informational purposes only. It does not purport to be comprehensive or to render professional advice. Before making any decision or taking any action that may affect you or your business, bespoke advice should be obtained.