Please note that goverment of Cyprus pauses all applications for Golden Visa Programme on 1st November 2020
Investment Immigration: how to obtain citizenship of Cyprus
Many wealthy people, including businessmen, officials, successful artists and sport professionals, invest in Cyprus real estate in order to obtain citizenship of this country.
Citizenship of the Republic of Cyprus provides a kind of dispersal airfield in case of serious economic or political problems in your home country. It allows you to reside, conduct business, buy property and make investments in all countries of the European Union (EU) without restrictions.
Cyprus taxation system is also very attractive for investors: the corporate tax amounts only 12.5% in this country. Cyprus has also implemented treaties precluding double taxation with 50 countries. This helps to avoid overcharging by double taxation and in some cases reduces taxation consequences.
Also, many entrepreneurs consider the possibility of retiring from business and moving to an economically stable country with an independent judiciary and high-level healthcare system, and live there as a rentier. If a foreigner, even if he or she has become a Cyprus citizen, lives in Cyprus for more than 183 days in a calendar year, he or she becomes a tax resident of Cyprus, receives a non-domicile status, and may enjoy the benefits of double taxation preclusion treaties. For the first 17 years, he or she will also be exempt from Cyprus tax on dividends and interest earned.
Procedure of obtaining citizenship
The procedure for obtaining a passport of the Republic of Cyprus is fast and relatively simple.
- Step 1. Buy real estate (part of the funds may be invested in securities of Cypriot companies).
- Step 2. Prepare the required documents.
- Step 3. Pass a vetting check and get the passport.
The whole process takes between six to twelve months, and most of the time is allocated to the screening of the applicant. A detailed description of all the steps can be found below.
Objects and amounts of investments
Investors have three options for obtaining Cyprus citizenship. They can buy:
- Residential real estate – the minimum amount is €2 million;
- Commercial real estate – €2 million + €500,000 for the mandatory purchase of housing for lifetime;
- Cyprus securities – €2 million + €500,000 for the mandatory purchase of housing for life.
As you can see, every investor is obliged to buy housing in Cyprus. Additionally to the above investments, VAT (5% or 19% – depending on the purpose of the object) and a €150,000 non-refundable contribution to public funds must be paid. In total, the minimum required investment amount is approximately €2.5 million.
In addition, the service of consultants, who will help you prepare a set of documents, will cost €25,000 – €40,000.
It is worth noting that the investor must own the acquired real estate or securities for at least five years. After that time, the investor can sell the property, although it is still required then to retain housing, the cost of which would be €500,000 or more.
List of documents
For the investment in Cypriot real estate to be approved, the following documents must be submitted:
- Documents confirming the removal of encumbrances from the real estate;
- A certificate confirming completion of the construction of the facility, or a bank guarantee of at least 5% of the property cost – if the investor buys property under construction.
- Planning permission.
When submitting documents for citizenship, the state fee of €2,000 will be charged.
Requirements for applicants
The applicant must be of legal age, have no criminal record and must not be subject to EU sanctions. To have complete confidence in obtaining Cyprus citizenship, it is worth requesting a preliminary check of your candidacy at specialized companies.
The investor must have a valid Schengen visa. If he or she has previously been denied citizenship within another EU country, the application will not be considered.
Apart from the investors themselves, Cyprus citizenship may be granted to:
- Investor’s spouses, even if the relationship is not officially registered. In this case it is necessary to confirm the financial dependence of the spouse and write an application for cohabitation;
- Investor’s children, who are under the age of 28 at the time of submitting the application. Adult children must not have their own sources of income;
- Investor’s parents and parents-in-law. The age of the parents and their financial dependence on the investor do not matter. However, it is required to purchase additional property for their residence for at least €500,000 + 5% VAT.
The verification of applicants for Cyprus citizenship takes between four and five months. After the notorious incidents of granting passports to persons under sanctions, Cyprus has been very careful in screening the applicant and his or her family. The government has been working hard to ensure the program of investment citizenship is not criticized by the EU and the country is not considered by international investors as a place where illegal funds flow. At the same time, economic consequences of the coronavirus pandemic have resulted in the authorities working on eliminating excessive restrictions imposed on the program.
The most common reasons for denial of citizenship are poorly prepared documents, inconsistent evidence of the legitimacy of invested funds, and withholding information about criminal penalties.
In case of application approval, the investor should get a certificate of naturalization and, in a few days, a passport.