- Overview: Cyprus
- Global PEO and payroll
- Global HR Compliance
- Expand without a company set up
- Contractor vs. employee: which is better?
- Work permit for hiring expats via PEO
Global PEO and Payroll in Cyprus
Cyprus is an increasingly attractive destination for individuals and businesses. A member of the EU since 2004, located in the eastern Mediterranean Sea. One of the fastest-growing economies in the European Union, Cyprus has the warmest climate within the EU while being easily accessible from Europe, Asia, and Africa – making it convenient for internationally mobile individuals.
The country’s excellent infrastructure, highly-educated workforce, and favorable tax system are at the heart of a modern, free-market, service-based economy. Many companies are considering expanding to Cyprus and hiring the best local talent.
However, setting up a business in Cyprus can be challenging, and it is not necessary, especially if your main goal is to run a smooth and risk-free operation.
Acumen’s Global PEO and Payroll solution offers the multinational companies a viable alternative and an efficient way to expand their operations to the island without the need to establish a legal business entity in Cyprus.
Acumen International – Your Professional Employer Organization in Cyprus
Abiding by the Cypriot legal system and adhering to regulations governing employment and taxation can be challenging for foreign businesses expanding into the country.
Partnering with Acumen International as a Global Professional Employer Organization (PEO) offers your business the local knowledge and on-the-ground support to conduct business in Cyprus without concern for legal and compliance risks.
Whether you are an agency representing international clients or are taking your own business operations abroad, Acumen International’s Global PEO and Payroll service allows you to compliantly hire, onboard and payroll local and expat employees in Cyprus on your company’s behalf.
Our global expert team with hyper local expertise will engage and compensate your employees in Cyprus in an easy, time and cost saving manner – without the risk of legal or tax repercussions. We take care of everything from paperwork to payroll.
International Global Payroll and Taxation in Cyprus
The complexities of payroll and taxation systems in Cyprus can be a serious deterrent to companies who want to conduct business in the European Union.
Taxes in Cyprus are levied by both the central and local administrations.
Employment related taxes in Cyprus
Employers contribute 8.30% of an employee’s monthly gross salary to the Social Insurance Foundation, 2.90% to the newly introduced General Healthcare System (GHS), 2% to the Social Cohesion Fund, 1.20% to Redundancy, 0.50% to Training and Development, and 8% to the Annual Leave Fund, unless the employer pays for annual leave directly.
Employees contribute 8.3% to the Social Insurance Foundation, and 2.65% to the General Healthcare System (GHS).
Cyprus adopts a progressive income tax system with a maximum tax rate of 35% for income over €60,000. Personal income tax (PIT) is paid by resident individuals on their worldwide income, by nonresident individuals – only on their income sourced in Cyprus.
Tax residence in Country
All Cyprus tax resident individuals are taxed on their chargeable income derived in Cyprus as well as abroad.
Individuals are considered tax residents in Cyprus if they spend more than 183 days in any one calendar year on the island. Also a tax resident is a person who resides in Cyprus for more than 60 days in a calendar year, and
- does not reside in any other country for a period exceeding in aggregate 183 days in the same year
- is not considered a tax resident in any other country in the same year
- exercises any business in Cyprus and/or is employed in Cyprus
- maintains a residential property in Cyprus (owned or rented)
Payroll Cycle in Country. The payroll cycle in Cyprus is monthly as standard with payments being made no later than the last working day of the month. Employers may instead opt for weekly payment cycles.
Salaries in Cyprus are paid in the local currency, the Euro (EUR).
13th salary in Cyprus. An additional 13th-month salary payment, payable around mid-December each year, is customary and expected in Cyprus. It is however an optional payment.
Non-payroll taxes in Cyprus
Value added tax (VAT) applies to most sales of goods and services in Cyprus. The Cyprus VAT is part of the European Union value added tax system.
Acumen PEO services may be subject to VAT in Cyprus.
The corporate tax rate in Cyprus is 12.5% as of 2021.
Off-Payroll Rules in Cyprus
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How Acumen’s International PEO and Payroll Service can Benefit Your Business in Cyprus
The continually evolving in-country labor laws and tax regulations make the Cypriot payroll and taxation system challenging to navigate.
When payrolling your local and expat workforce in Cyprus and closely adhering to the country’s taxation requirements, your attention can be diverted from growing your business.
A reliable global employment solution like Acumen’s Global PEO and Payroll service can take a substantial burden off your shoulders so you can focus on running your company in Cyprus.
Outsource the administrative and compliance tasks involved in compensating your global employees with Acumen. Our complex global PEO and payroll solution goes beyond outsourcing. We hire and compensate your global workforce on your behalf, and take care of all the details of payroll while ensuring full compliance with Cypriot labor and taxation laws.
NOTE: It is important to note that Acumen does not provide international global payroll services as a standalone solution, but only as a part of our global PEO and Payroll solution.
Partnering with Acumen International and leveraging our global PEO and Payroll service in Cyprus puts your agency, business, and organization in a prime position to leverage our services against your competition. Our solid global employment solutions enable your selected global talent – both locals and expats’ official employment and compensation on your company’s behalf.
Interested in finding out more about our all-in-one Global PEO and Payroll solution? Get in touch now or request a quote on Cyprus and other 190 countries we cover.