The recent amendments to the Naturalisation of Investors in Cyprus by Exception Scheme, based on subsection (2) in Section 111A of the Civil Registry Laws of 2002-2015 was approved by the Cyprus Council of Ministers on the 13 September 2016.
The positive amendments are set to further enhance incentives to attract more foreign investment into Cyprus, and further solidifies Cyprus’ position as the leading EU Citizenship by Investment program. The program remains one of the top CBI choices for high net worth individuals around the world.
Further to Council of Ministers amendments, announced on 13 September and the elaboration, as announced by the Cyprus Gazette on 16 September 2016, Cyprus has reduced its investment criteria to a minimum of €2 million for residential real estate, and made the program even simpler and more appealing.There are a number of reasons the Cyprus Citizenship by Investment (CBI) Program is now considered to be the most attractive in Europe, including:
- There is no requirement to make a donation to the local government, in contrast to many other citizenship programs worldwide.
- Cyprus does not require applicants to live on the island prior, during or after the application process, unlike all other EU countries with citizenship programs that impose some form of residency requirements.
- Applicants are able to receive a Cypriot passport within 3 months of filing an application, being by far the fastest route to EU Citizenship.
- Simple and straightforward application process with no requirements to disclose source of wealth or funds, no medical testing, and no language requirements.
- Approved by the EU (being one of only two CBI programs in Europe with official EU approval).
Below are listed the investment options available to Non EU investors, who can apply for citizenship for their whole family, including spouse, children, adult dependants and parents:
Option 1: EUR 2 million (real estate)
An investment, held for three years, of EUR 2 million (plus VAT of 0%, 5%, or 19%) in residential real estate situated in Cyprus.
The investment in real estate must be retained for a minimum period of 3 years, after which point the overall investment in real estate can be reduced to a minimum of €500,000 in residential property (excluding any VAT that was paid on initial acquisition).
Examples of above includes the following (all prices below are quoted before VAT, if any):
- Purchase one villa for €1.5 million, and one apartment for €500,000. Sell the villa in 3 years’ time.
- Purchase one villa for €2 million and sell in 3 years’ time, but simultaneously purchase a residential property(ies) for a minimum of €500,000.
Option 2: €2.5 million (combination of real estate and/or investments)
A 3 year investment of €2 million within any of the following investment categories:
- Interest bearing Cyprus government bonds, provided the investment does not exceed €500,000 (current annual yield of such retail bonds is 0.75%).
- An investment held for three years, of EUR 2 million (plus VAT of 0%, 5%, or 19%) in “eligible real estate” situated in Cyprus, namely:
- Land, provided there is a development plan in place.
- Creation, acquisition or participation in a Cyprus company or business where the applicant is a majority shareholder, with activities in Cyprus, and employing 5 Cypriot or EU nationals, who have been resident in Cyprus for a duration of 5 years prior to the filing of the citizenship application.
- Alternative Investment Fund (AIF) or financial assets of a Cyprus entity licensed by the Cyprus Securities and Exchange Commission (CySec), with activities in Cyprus.
- Mix and match any of the above options.
- EUR 500,000 (plus VAT of 0%, 5%, or 19%) in residential property, which must be held indefinitely.
Overall, the amended Cyprus CBI program coupled with the fact that the Cypriot taxation system is consistently voted as one of the most favourable in Europe (with the newly introduced “non-domicile” regime which results in zero taxation of worldwide dividends and interest income, for period of 17 years),ranks Cyprus highly,for all serious high net worth individual investors.
We are leaders in the area of Immigration Services in Cyprus, and well positioned to assist clients with the preparation and filing of a Citizenship Application. We are frequently engaged by some of the world’s largest and most reputable international law firms, accounting firms and family offices.
For further information on the existing or newly revised Cyprus CBI program, and to further discuss your investment options, feel free to contact our immigration team who will be happy to assist.