In current practice, a significant share of EMET's clients live in Cyprus but hold their principal assets outside Cyprus — primarily with Swiss private banks and other international structures. In such cases, Cyprus is not the centre of the overall asset structure but the client's jurisdiction of tax residence, and EMET's work is built not around local companies but around coordinating the client's entire position across jurisdictions.
CORE
Cyprus
Cyprus is one of the key jurisdictions for Russian-speaking HNWI in Europe — and historically one of the primary jurisdictions through which Russian capital has been structured and held outside Russia. A Cyprus company as a holding structure is present in the asset structures of a significant share of EMET's clients, regardless of where they physically live. Cyprus tax residency (through the non-dom regime and the simplified 60-day test) is a separate, narrower case.
EMET advises clients with a Cyprus nexus through a dedicated team on the ground — with local EU licences and compliance qualifications. The team handles the Cyprus side of the work; strategic management of the client's position is led from EMET. The sections below describe the principal areas through which each client position passes.
01
How clients use Cyprus
EMET works with several use cases of Cyprus, which often overlap for the same client.
Cyprus as a jurisdiction of residence, with assets held outside Cyprus. The most common scenario in EMET's current practice. The individual is a Cypriot tax resident (non-dom + 60-day rule), while principal assets are structured outside Cyprus — in Swiss private banks, brokerage structures, or foreign companies. Local Cyprus structures are typically not established in this scenario, as they are not required. EMET handles the client's personal Cyprus tax position and coordinates the entire international picture.
Cyprus as a holding jurisdiction. The client may live anywhere — in Spain, Italy, Germany, Russia — but owns a Cyprus company that in turn holds investment portfolios, stakes in operating businesses, real estate, or other assets. The Cyprus structure operates as the “upper level” of the client's international architecture.
Cyprus residency together with a Cyprus company. A combined scenario. The client lives in Cyprus and at the same time uses a Cyprus company as part of an international structure. This is the most compliance-intensive setup.
Family-office model. Several Cyprus entities in the architecture of one family — operating, holding, sometimes IP-holder.
02
Tax regimes for the new resident
Cyprus residency is a distinct legal status that differs from the vast majority of EU jurisdictions on two key points.
60-day residency rule. This rule makes Cyprus one of the few European jurisdictions where tax residency can arise without spending the majority of the year physically in the country. For EMET clients it is often the starting point of a relocation: the client obtains a Cyprus tax position while preserving international mobility. The common misunderstanding is to treat 60 days as automatically producing a defensible status. In practice the full factual picture is tested: a Cyprus home, economic tie, days spent in other countries, possible overlap with another tax residency, and documentary support. After the 2026 reform, the question is no longer simply whether the client is resident nowhere else; if another country also claims residency, treaty analysis and tie-breaker logic become central.
This is one of the most flexible residency tests in the EU, making Cyprus attractive for clients seeking EU residency without the requirement to physically spend most of the year in the country.
Non-domiciled status. For a client moving to Cyprus, non-dom is not a decorative benefit but the mechanism that defines the economics of the entire residency structure. Without it, Cyprus loses a large part of its appeal for capital holders living on dividends and interest income. EMET therefore tests non-dom before the relocation structure is implemented: domicile origin, residency history, expected income mix, and the bankability of the status.
Practical aspect of non-dom status. Legally, non-dom status arises automatically once the criteria are met. In practice, however, it requires proper documentation.
For banking and tax compliance purposes, the official confirmation of status — the non-domicile certificate, issued by the Cypriot tax authority — is used. This document applies:
- in dealings with banks and brokers
- when receiving dividends and interest income
- when working with Cyprus companies (where present in the structure)
Absence of confirmed status can lead to:
- incorrect application of SDC
- additional inquiries from banks
- inconsistency in the tax position
EMET handles not only the obtaining of non-dom status but also its application in practice — including its integration into the client's KYC profile and its use in banking compliance.
Standard income tax. Applies to employment income and other non-passive sources on a progressive scale — 0% up to €22,000, then 20-35% by brackets. Capital gains tax applies only to the sale of Cypriot real estate or shares in companies holding Cypriot real estate; capital gains on foreign assets are not taxed.
Duration of non-dom. Unlike Beckham Law in Spain or the forfait in Italy, Cypriot non-dom status is available for up to 17 years — a significantly longer horizon than the 6-year Beckham. This makes Cyprus attractive for clients with a long-term perspective of life in the EU.
GESY — mandatory healthcare contributions. Cypriot residents participate in the General Healthcare System (GESY) and pay corresponding contributions — approximately 2.65% of income (subject to an annual cap). This is not a “tax,” but a mandatory annual payment that factors into the overall burden of a resident client.
03
Cyprus as a holding jurisdiction
Although Cyprus has historically been used as a holding jurisdiction, in EMET's current practice such structures are created only where they are genuinely necessary. In many cases the client's task is solved without a Cyprus company — through correct configuration of personal tax status and coordination with existing structures.
When a Cyprus company is part of the client's architecture — usually it is a historically established structure, or a specific business need that requires an EU-resident corporate layer. The key parameters of the regime are as follows.
Corporate tax. As of 1 January 2026, the standard corporate income tax rate in Cyprus is 15% (previously 12.5%).
Participation exemption. This is why a Cyprus company often appears in a client's international structure as a holding tier. But for EMET this is not, by itself, an argument “for Cyprus.” The question is practical: does the structure have a real function, does it withstand substance review, does it create CFC exposure in the beneficiary's residence jurisdiction, and does it cost less than the tax benefit it is meant to deliver. A Cyprus holding is a workable tool only if it continues to match the factual business and ownership model.
DTT network. Cyprus has one of the broadest networks of double-taxation treaties in the EU — over 65 treaties in force. Historically this included a particularly favourable Russia-Cyprus DTT, which was renegotiated in 2020 with withholding tax on dividends and interest increased to 15%. In 2023 Russia suspended a number of DTT provisions with several countries, including Cyprus, by Decree No. 585 — practical application requires separate analysis in each specific case.
IP box regime. Cyprus has a favourable regime for intellectual property — qualifying IP income is taxed at an effective rate of approximately 3%. Applicable to clients with IP assets in their structures.
Substance requirements. This is the decisive factor for a client weighing whether a Cyprus company is needed at all. Substance is not a formal mention of directors in the corporate documents — it is an actual operational configuration that costs money every year. If the expected tax benefit of a Cyprus holding is smaller than its maintenance cost and the re-characterisation risk in the country of the beneficiary's residence, the Cyprus company becomes a liability rather than a tool. EMET begins the substance conversation before incorporation, not after — because the cost of getting it wrong is years of maintaining a structure that does not in fact work.
04
Russia-Cyprus DTT and CFC considerations
The Russia-Cyprus bilateral tax landscape has a long history and recent developments that warrant separate attention.
Renegotiation in 2020. The Russia-Cyprus DTT was renegotiated in 2020 at Russia's initiative: withholding tax on dividends and interest was increased from preferential rates to 15%. This reduced, but did not eliminate, the advantages of the Cyprus structure for Russian residents.
The DTT after 2023. This change is rarely assessed by clients with the right degree of caution: “suspension” does not mean an automatic nullification of the treaty, and a specific payment (dividend, interest, royalty) can produce different conclusions depending on which provisions are affected at the moment of the transaction. For a Russian client holding a Cyprus structure, this means that any material transaction now requires a separate pre-analysis rather than the application of “as it was before.”
CFC considerations. A Cyprus company does not automatically take a Russian client outside the Russian reporting system. This is a recurring misconception: the client sees an EU-resident company, a Cyprus bank and a local tax regime — and assumes the Russian side is closed. In practice, two positions must be maintained in parallel: the Cyprus corporate position and the Russian CFC position. The risk usually arises not from the structure itself, but from inconsistencies between what is filed in Cyprus, what is reported to the Russian tax authority and what is explained to the bank.
For a Cyprus-resident client owning foreign companies, Cypriot CFC rules apply (Cyprus has implemented the EU CFC Directive). They apply to low-taxed foreign companies with passive income, but have substantial thresholds and exemptions.
EMET handles both sides — Russian CFC reporting and Cypriot corporate compliance — in coordinated fashion, as a single position.
05
Banking: Cyprus–Switzerland coordination
The Cypriot banking sector has undergone several significant transformations over the past decade with direct relevance to Russian-speaking clients.
Before 2013-2018. Cypriot banks (Bank of Cyprus, Hellenic Bank) were one of the central banking infrastructures for Russian HNWI capital.
Post-2018 de-risking. After EU regulatory measures, a significant share of “mass” Russian client portfolios was closed. Many HNWI clients moved their investment accounts to Switzerland, leaving Cyprus for operational and corporate activity.
Post-2022. Further tightening of source-of-funds procedures and AML requirements. Opening new accounts for Russian-speaking clients is significantly more difficult than it was 5-10 years ago.
In the current configuration of EMET's client base:
- Cyprus is used for operational infrastructure and residency
- Switzerland is used for capital storage and management
EMET builds the link between these tiers. Most banking-compliance failures for Russian-speaking clients arise not from one specific answer being wrong, but from different banks receiving different versions of the story — different figures, different source-of-funds rationales, different chronologies. Cyprus and Switzerland are two sides of the same client position; the synchronisation mechanics are set out in the note alongside, but the practical value for the client is that any query from any bank fits into the same single coherent profile.
06
Common client configurations
EMET in Cyprus works with variations of several typical setups.
Configuration A — Cyprus resident with assets held outside Cyprus, without local Cyprus structures
The client is a Cypriot tax resident (non-dom + 60-day), while principal assets are located outside Cyprus — in Swiss private banks, brokerage structures, or foreign companies. In this setup, Cyprus companies are not created unless there is a direct need. EMET handles:
- the client's personal Cyprus tax position
- coordination with banks — Swiss, Cypriot, and others — on KYC, source of funds, confirmation of residency
- coherence of the client's entire structure across jurisdictions
This is one of the most common scenarios in EMET's current practice.
Configuration B — Holding-only
The client lives in Russia, Spain, Italy, or another country. In Cyprus — a holding company holding an investment portfolio, stakes in operating businesses, or other assets. EMET handles the corporate side of the Cyprus company through a dedicated team on the ground — annual filings, accounting, compliance, coordination with the bank. The client's personal tax side remains in the jurisdiction of residence.
Configuration C — Cyprus resident with a Cyprus company
A combined case. The client lives in Cyprus and at the same time owns a Cyprus holding company. EMET handles both sides — the personal tax side (through non-dom) and the corporate side (through the corporate tax regime and the participation exemption). This is the most compliance-intensive setup.
Configuration D — Family-office model
Several Cyprus entities in the architecture of one family: operating, holding, sometimes IP-holder. EMET coordinates with the family-office side (where one is in place) and handles the entire Cyprus corporate side.
07
How EMET works with a client in Cyprus
EMET does not build redundant local structures and does not create Cyprus companies without necessity. The firm's task is to make the client's position transparent, consistent, and resilient to bank and tax-authority reviews — regardless of where the client's assets are located.
Unlike the classical model of “a Cyprus provider performing a Cyprus service,” EMET acts as the central coordination point for a client whose Cyprus is one point in the system (often the place of residence), with assets and position distributed across jurisdictions. EMET's dedicated team on the ground in Cyprus — with local EU licences and compliance qualifications — handles the Cyprus technical side; strategic management of the position is led from EMET.
The standard cycle of advising a Cyprus client position consists of four phases.
1. Structuring the client's overall position
Analysis of where the client is a tax resident, where the assets are located, what risks are present. This phase precedes any technical action and determines whether Cyprus structures are needed at all. For a substantial share of clients, the conclusion of this phase is that a local Cyprus company is not needed.
2. KYC alignment
A single logic of source of funds across all the client's banks (Swiss, Cypriot, Russian, others). Consistency of documents across jurisdictions. Preparation for bank reviews and regulatory inquiries as a coordinated position, not as scattered responses. This is a central part of the firm's work — banks in several jurisdictions must see the same coherent profile of the client.
3. Cyprus tax compliance
Non-dom certification, annual Cypriot declarations, GESY contributions, Cypriot compliance obligations. For clients with a Cyprus company — corporate accounting, audited financial statements, annual returns, the corporate declaration. This is the technical side, which takes its share of the work but is not the centre.
4. Coordination across jurisdictions
Alignment with banks, with the client's previous residency (Russia or another country), with existing structures in other jurisdictions. Russian CFC reporting on the Cyprus company (for Russian-resident owners). Currency control. Inheritance planning taking into account the Cyprus and other jurisdictional structure.
08
Note on applicability
The mechanisms above are a framing picture. The concrete tax outcome in any given situation depends on the owner's residency status, the configuration of non-dom, the form of asset ownership (personal direct or through a Cypriot or foreign structure), the applicable double-taxation treaty in its current state, and the factual character of the structure's activity (substance present, Cyprus-source versus foreign-source income). Determining the actual regime calls for individual analysis against the specific structure and factual history.
Topics
If your position involves Cypriot residency, a Cyprus company within an international structure, or a combination of both — a preliminary discussion can help clarify which part of the Cyprus side is genuinely needed for your specific situation, and which is not, before decisions are taken on structuring.
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