Although fewer than one million people live on the island, Cyrpus is one of the UK’s top 50 export markets – which is great news if you’re thinking of doing business in the eastern Mediterranean.
And while it’s suffered in recent years as a result of the economic crash, tough austerity measures are in place to restructure the economy and it’s making progress against all the main objectives set out by the country’s international lenders.
In fact, the new measures have opened up business opportunities across even more sectors of the economy.
Now could be a good time to start doing business in the eastern Mediterranean, so here’s everything you need to know about exporting to Cyprus.
The pros and cons of exporting to Cyprus
The strengths of the Cypriot market are:
- Gateway to the Middle East, Gulf, Russia and eastern Europe
- Lowest corporate tax (12.5%) in the EU
- Advanced telecommunications network and infrastructure
- Highly educated and skilled workforce (mostly UK educated)
And if you’re thinking of exporting there, the advantages for UK business, are:
- No trade barriers as European Union (EU) member
- High awareness of UK products and brands
- English widely spoken
- Island economy so relies heavily on imports
- Large number of British nationals living on the island or visiting as tourists
- Business culture, banking, accounting and legal systems similar to UK
It’s not without its problems though, aside from the fact that the island’s political needs careful consideration, you’ll also have to overcome these obstacles:
- A lack of transparency
- Possible bias in government consideration of competing bids
- State bureaucracy and slow procedures
The UK’s main exports to Cyprus are:
- Road vehicles, parts and accessories
- Petroleum, petroleum products and related materials
- Drinks including spirits
- Electrical machinery, boilers, mechanical appliances, engines and parts
- Clothing and clothing accessories
- Cereal grains, flour and food preparation ingredients
- Iron and steel products
- Pharmaceutical products
If you’re doing business in Cyprus, you’ll need a reliable and cost-effective conference call provider to help keep in touch when travelling isn’t an option. Here’s How to set up a conference call between the UK and Cyprus.
And remember, you can now screen share and video conference, using Crankwheel.
Tax and customs
The UK signed a double taxation agreement with Cypurs, so tax isn’t paid twice – once in each country – on exported goods and services.
The following tax rates currently apply in Cyprus:
- VAT is charged at 19%, with reduced rates of 9%, 5% and 0% on specific goods and services
- All companies are charged a uniform rate of 12.5%
- Personal income tax between 35%.
The internal EU single market allows for the free movement of goods and services without any import duties being applied. For more information on customs procedures, visit Cyprus Customs and Excise.