What does it mean to "carry out business" in Cyprus to fall under 60-days rule?

[resident101]

Hi All,

Sorry if this has been asked before, but couldn't find it..

Mu idea: I work as a consultant for a US company. I am a Portuguese national. I want to use the 60-days rule to be taxed in Cyprus, I won't reside in Portugal for more than a few weeks a year.

I start an LLC in Cyprus and my clients pay me to this LLC.

My question is: to fall under the 60 days rule, it says I have to "do business" in Cyprus. Now what does it mean? Do I need a phisical office? Do I need to hire someone in Cyprus?
Would the fact that my LLC is in Cyprus and the lLC is doing business by providing consulting services to foreign companies count as "doing business" for the 60-days rule purpose?

Hope my question is clear.

Thanks all!

 

[CyprusLaw]

Hi All,

Sorry if this has been asked before, but couldn't find it..

Mu idea: I work as a consultant for a US company. I am a Portuguese national. I want to use the 60-days rule to be taxed in Cyprus, I won't reside in Portugal for more than a few weeks a year.

I start an LLC in Cyprus and my clients pay me to this LLC.

My question is: to fall under the 60 days rule, it says I have to "do business" in Cyprus. Now what does it mean? Do I need a phisical office? Do I need to hire someone in Cyprus?
Would the fact that my LLC is in Cyprus and the lLC is doing business by providing consulting services to foreign companies count as "doing business" for the 60-days rule purpose?

Hope my question is clear.

Thanks all!

Having a Cyprus company will suffice for this purpose, but you need to be careful to ensure you have a proper structure. I can PM you to discuss this.

 

[Gediminas]

Hi All,

Sorry if this has been asked before, but couldn't find it..

Mu idea: I work as a consultant for a US company. I am a Portuguese national. I want to use the 60-days rule to be taxed in Cyprus, I won't reside in Portugal for more than a few weeks a year.

I start an LLC in Cyprus and my clients pay me to this LLC.

My question is: to fall under the 60 days rule, it says I have to "do business" in Cyprus. Now what does it mean? Do I need a phisical office? Do I need to hire someone in Cyprus?
Would the fact that my LLC is in Cyprus and the lLC is doing business by providing consulting services to foreign companies count as "doing business" for the 60-days rule purpose?

Hope my question is clear.

Thanks all!

Hey,

As a general rule, as long as you spend in Portugal 4 weeks per year, and you don’t have a permanent home, also if you don’t spend anywhere else a significant period of time, you should not be considered a resident under local rules in any country.

Under the general residency concept (which comes from OECD model tax treaties) it is assumed that an individual must have one tax residency country somewhere. So you can decide to consider Cyprus is your tax residency county, you can obtain a “yellow slip” and submit your personal tax returns under standard procedure (183 days rule) (even if you have not spent in Cyprus so much time).

In addition to the residency certificate “yellow slip”, and tax return, you can “substantiate” residency with rental, utilities, company, and employment. But generally for this reason you don’t need to have much substance in Cyprus or spend a lot of time in Cyprus. Cyprus will not challenge your residency in any way.

Only other country that wants your taxes can try this. 60-day rule to be honest is a bit fake, because if you check the conditions they say, that this certificate is not valid internationally, i.e. it is not valid if any other country is challenging residency. In other words, a certificate issued under the 60-day rule is not in line with the double tax treaties signed by Cyprus.

On the other hand, if you believe that you need a tax residency certificate as a separate document and you spend more than 60 days you can obtain it (provided that you have employment, rental, and can prove few local expenses, like grocery stores).

I hope this helps.

 

[xhomer2020]

Hey,

As a general rule, as long as you spend in Portugal 4 weeks per year, and you don’t have a permanent home, also if you don’t spend anywhere else a significant period of time, you should not be considered a resident under local rules in any country.

Under the general residency concept (which comes from OECD model tax treaties) it is assumed that an individual must have one tax residency country somewhere. So you can decide to consider Cyprus is your tax residency county, you can obtain a “yellow slip” and submit your personal tax returns under standard procedure (183 days rule) (even if you have not spent in Cyprus so much time).

In addition to the residency certificate “yellow slip”, and tax return, you can “substantiate” residency with rental, utilities, company, and employment. But generally for this reason you don’t need to have much substance in Cyprus or spend a lot of time in Cyprus. Cyprus will not challenge your residency in any way.

Only other country that wants your taxes can try this. 60-day rule to be honest is a bit fake, because if you check the conditions they say, that this certificate is not valid internationally, i.e. it is not valid if any other country is challenging residency. In other words, a certificate issued under the 60-day rule is not in line with the double tax treaties signed by Cyprus.

On the other hand, if you believe that you need a tax residency certificate as a separate document and you spend more than 60 days you can obtain it (provided that you have employment, rental, and can prove few local expenses, like grocery stores).

I hope this helps.

I am insterested in the cyprus non-dom 60 day-rule. I am surprise what you said that is not valid certificate. I am from Spain and was looking into this non-dom 60 day or portugal NHR fiscal residency. What is best way to structure this?