course content
07/10/2025 15:00 - 18:15
08/10/2025 15:00 - 18:15
14/10/2025 15:00 - 18:15
15/10/2025 15:00 - 18:15
21/10/2025 15:00 - 18:15
22/10/2025 15:00 - 18:15
29/10/2025 15:00 - 18:15
UNIT 1: Taxation of Intercompany Dividends under Cyprus Tax Law, Tax Treaties and EU Law – Part A
• Cyprus domestic rules on dividend income: Overview of the general non-taxability of dividend income for Cyprus tax resident companies under the Income Tax Law, subject to specific exceptions under the Special Defence Contribution (SDC) regime.
• Participation exemption regime: Conditions for exemption from SDC on dividend income – including minimum holding period, passive income test, and subject-to-tax test.
• Deemed dividend distribution rules: Explanation of provisions applicable to Cyprus-resident companies with undistributed profits to Cyprus-resident shareholders.
• Anti-abuse measures related to dividend income: Domestic anti-avoidance provisions, including GAAR, application of “non-genuine arrangements”.
• Outbound dividends from Cyprus: No withholding tax on dividend payments made by Cyprus companies to non-resident shareholders.
• Inbound dividends to Cyprus: Treatment of dividends received from both EU and non-EU jurisdictions, and potential SDC implications.
UNIT 2: Taxation of Intercompany Dividends under Cyprus Tax Law, Tax Treaties and EU Law – Part B
• EU Parent-Subsidiary Directive: Scope, requirements, and implementation in Cyprus; analysis of minimum 10% participation threshold and minimum holding period.
• Anti-abuse rule under the Directive: Conditions under which benefits of the Directive may be denied, including artificial arrangements and principal purpose tests.
• Interaction between EU law and Cyprus domestic law: Harmonisation of participation exemption regime with EU law, including ECJ jurisprudence (e.g., the Danish Cases).
• Tax treaty relief for dividends: Key features of Cyprus’s extensive treaty network, treaty withholding tax rates, and application of the OECD Model Tax Convention Article 10.
• Beneficial ownership concept: Evolving interpretation under both treaty and EU contexts, and practical implications for holding structures involving Cyprus entities.
• Case studies and practical application: Analysis of common holding structures through Cyprus for inbound and outbound dividend flows, with reference to risk
UNIT 3: Taxation of Interest under the Cyprus Tax Law, EU Law and Tax Treaties – Part A
• Domestic taxation of interest income: Distinction between active and passive interest income under the Cyprus tax framework (Income Tax Law vs. SDC Law).
• Interest deductibility for payer companies: Analysis under Cyprus corporate income tax rules, transfer pricing principles, and potential limitations post-ATAD implementation.
• Withholding tax on outbound interest payments: General absence of withholding tax on outbound interest, with reference to recent changes effective from 2022 (for blacklisted jurisdictions).
• Arm’s length principle and transfer pricing: Requirements under Cyprus TP rules for intercompany interest rates, with emphasis on OECD Guidelines alignment.
• Timing and characterisation of interest: Rules on accrual basis, capitalised interest, and related-party transactions.
• Interaction with the EU Interest and Royalties Directive: Scope and limitations of the Directive as implemented in Cyprus, including anti-abuse
provisions.
UNIT 4: Taxation of Interest under Cyprus Tax Law, EU Law and Tax Treaties – Part B
• Interest income received by Cyprus companies: Tax treatment depending on the nature of activities (active vs. passive), including exemption or inclusion in taxable base and SDC application.
• Application of tax treaties: Analysis of Cyprus treaty provisions on interest (Article 11 of OECD MTC), typical withholding tax rates, and treatment of beneficial ownership.
• Beneficial ownership and substance: Consideration of recent OECD and ECJ developments impacting access to treaty benefits.
• Hybrid mismatch and interest limitation rules: Relevance of ATAD interest limitation provisions to inbound and outbound interest flows, including the 30% EBITDA rule.
• Interest flows in common financing structures: Use of Cyprus entities in group treasury or financing hubs; review of tax planning opportunities and risk exposure.
• Compliance and documentation: Local file and master file requirements, as well as practical TP documentation expectations for intercompany financing arrangements.
UNIT 5: Taxation of Intellectual Property under the Cyprus Tax Law, EULaw and Tax Treaties – Part A
• Cyprus IP Box Regime – Overview: Qualifying IP, eligible income, and effective tax rate under the nexus compliant IP box introduced in 2016.
• Definition of qualifying assets and income: Alignment with OECD BEPS Action 5, exclusion of trademarks and marketing-related IP, and computation of nexus fraction.
• Treatment of R&D expenses: Direct connection between eligible expenditures and qualifying income; importance of Cyprus-incurred R&D for preferential treatment.
• Interaction with capital allowances: Depreciation of IP assets for tax purposes and treatment of capitalised development costs.
• Anti-abuse considerations: Use of the IP regime in substance-based structures; restrictions against purely artificial arrangements or offshoring of ownership.
• EU law implications: Compatibility of the Cyprus IP regime with EU State aid rules and principles of free movement; review of relevant Commission and ECJ jurisprudence.
UNIT 6: Taxation of Intellectual Property under the Cyprus Tax Law, EULaw and Tax Treaties – Part B
• Cross-border royalty payments: Absence of withholding tax on outbound royalties when IP is used outside Cyprus; exceptions and recent blacklist provisions.
• EU Interest and Royalties Directive: Implementation in Cyprus and anti-abuse rule for claiming benefits under the Directive.
• Treaty protection for royalty income: Analysis of typical treaty provisions (Article 12 OECD MTC), limitation on source taxation, and beneficial ownership requirements.
• Inbound royalties to Cyprus: Taxation under domestic rules depending on source and treaty relief; role of substance and transfer pricing.
• Use of Cyprus IP Structures in global value chains: Practical examples of IP ownership, licensing, and cost-sharing structures
through Cyprus.
UNIT 7: Taxation of Immovable Property under Cyprus Tax Law, EU Law and Tax Treaties
• Definition and scope of immovable property: Interpretation under Cyprus domestic law and under tax treaties, including the OECD and UN Models.
• Capital gains tax regime: Application of CGT on disposals of Cyprus-situated immovable property or shares in companies deriving value from such property.
• Taxation of rental income: Distinction between corporate and individual landlords; applicable tax rates, exemptions, and allowances.
• Withholding tax on rent or sale proceeds: Recent amendments introduced WHT on certain outbound property-related payments (from 2023 onwards).
• Treaty allocation of taxing rights: Typical Article 6 and Article 13 treaty provisions concerning property income and capital gains from real estate-rich companies.
• Anti-abuse measures and economic substance: Substance requirements for non-resident owners of Cyprus property; risks under GAAR and treaty LOB clauses.
This course is designed for professionals employed in tax advisory firms, law firms, accounting practices, corporate service providers, and finance or legal departments of companies engaged in cross-border structuring, holding, financing, or intellectual property management through Cyprus. Participants must be actively involved in the planning, analysis, or compliance of passive income streams such as dividends, interest, royalties, or immovable property.
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