Cyprus investment Fund investor’s tax benefits

Fund’s Corporation Tax

Corporation tax for Cyprus Fund SPV’s is 12,5% on the taxable income derived from sources both within and outside Cyprus

Fund’s income form dividends, profit from sale of securities

Income from dividends (subject to easily met conditions) or profit from the sale of securities (including shares and units) constitute tax-exempt income

Fund’s Interest income

Interest income accruing or arising will be considered to be closely connected to the ordinary activities of the Fund and therefore taxed at 12.5%

Investor’s taxation Deemed Dividend Distribution Rules for non Cyprus tax residents

The deemed dividend distribution provisions do not apply to profits attributable to non-Cyprus tax residents or to Cyprus tax resident who have obtained the “Cyprus non-domicile” status

Investor’s taxation on redemptions

No Cyprus taxes will be suffered by the investors ( Cyprus residents or not ). Redemtions of profits generated from sale of immovalbe property will not be subject to any capital gains tax as they will be considered to be of a trading nature

Investor’s taxation on dividends received by non Cyprus tax residents or non-domicile Cyprus tax residents

Non-Cyprus resident investors (individuals or companies) will not be subject to any Cyprus withholding taxes upon the receipt of dividends from the Fund. Cyprus tax resident who have obtained the “Cyprus non-domicile” status will also not be subject to any Cyprus witholding taxes upon receipt of dividents

Investor’s taxation on dividends received by Cyprus tax residents

Cyprus resident individual investors will be subject to 17% defence contribution withheld at source upon the payment of dividends from the Fund. This will be their final Cyprus tax burden

Investor’s taxation Deemed Dividend Distribution Rules for Cyprus tax residents

The profits attributable to Participating Shareholders (companies or individuals) who are Cyprus tax residents may be subject to the deemed dividend distribution rules. These rules provide that if a company, does not distribute at least 70 per cent of its accounting profits after tax, as defined by the relevant law, within two years after the end of the tax year to which the profits relate, it will be “deemed” to have distributed as a dividend 70 per cent of such profits. Special Defence Contribution at the rate of three per cent (17%) will be imposed at the end of the two years on the amount deemed to be distributed to tax residents in Cyprus

Investor taxation Disolution Rules for non Cyprus tax residents

The proportion attributable to non-Cyprus tax-residents or non-domicile Cyprus tax residents Participating Shareholders will be exempt from any tax or Special Defence Contribution in Cyprus

Investor taxation Dissolution Rules for Cyprus tax residents

The proceeds will be subject to Special Defence Contribution at the rate of three percent (17%) for the proportion attributable to Cyprus tax-resident Participating Shareholders

Cyprus investment Fund investor’s tax benefits

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