Investors in innovative and startup businesses will receive tax cuts up to 50% of their taxable income according to a series of tax incentives approved Wednesday by the Cyprus Council of Ministers (cabinet), in an attempt to boost business and innovation in Cyprus.
The announcement was made by the Undersecretary to the President, Constandinos Petrides after the cabinet meeting.
“Today, the cabinet has approved a significant package of tax measures for innovative startups which we thing will help business and innovation in Cyprus”, said Petrides in a statement.
“We adopted practices which are applied in many countries”, added Petrides, who noted that the package of measures was the result of discussion with the business world and startup community in Cyprus.
Under the new incentives an investment in a startup business will allow the investor to pay as much as 50% less on his taxable income, depending on the size of the investment. The investment can be made in an investment fund, or to a business directly, and can be made to a business managed by a legal or physical person. There is a limit on the tax discount of €150,000 per year, along with the right to transfer the discount up to five years later.
In addition, the definition of a startup was amended to be less restrictive.
“Now it includes a wide range and is less limiting, allowing more substantive use by young businessmen who have innovative ideas which they can translate into entrepreneurship and commercial products”, said Petrides.
The Undersecretary to the President also said that the measures will take effect after being voted in by the plenary of the House of Representatives.