Funding your Business | Getting Funding

The start-up ecosystem is supported by private and public institutions looking to incubate or finance start-up initiatives that are generating innovation in sciences, finance and entertainment.

The main body for financing business research and subsidizing the development of start-ups with global reach is the Research and Innovation Foundation (RIF).

Co-funded by the Cypriot government and European Union structural funds, RIF offers schemes (based on eligibility and qualitative criteria) financing start-ups for research and initial development. The grants cover up to 85% of the invested capital.

The Cypriot government offers significant financing schemes to support start-up ventures throughout their development.

Research and Innovation Foundation (RIF)

The two major activity pillars of RIF activities are the following:

a) The development and management of national research, technological development and innovation programmes in Cyprus;
b) The promotion of Cypriot research organisations, enterprises and researchers in European and other international research and innovation programmes.

The RIF organizes training and awareness-raising activities; represents Cyprus in European and other research and innovation committees, working groups, networks and initiatives; implements studies; and submits suggestions to the relevant authorities for further research and development policy initiatives.

Industry and Technology Service

The Industry and Technology Service (part of the Ministry of Energy, Commerce and Industry) manages and distributes funds under a variety of programmes. Recent examples include:

a) Enhancing SME competitiveness in the manufacturing sector and other specific economic activities;
b) Women’s entrepreneurship;
c) Youth entrepreneurship;
d) Manufacturing / marketing / development of agricultural products;
e) Encouraging investment activity and enhancing competitiveness in the wine industry;
f) Strengthening business innovation.

Assistance for entrepreneurs can also be found through the Ministry of Agriculture and the Cyprus Agricultural Payments Organisation, which manages and distributes grants for the primary sector.

Initiatives in Cyprus, especially those that have the potential to penetrate large international markets or sectors, are often supported by Cypriot banks through financing.

In order to acquire a loan, you must provide collateral in the form of liquid or illiquid assets and be able to partially finance your initiative.

To acquire debt financing in Cyprus, you must show the financing institution a fully detailed business plan, showing the strategic and development potential as well as projected income of your venture.

Shareholders that can show experience at the domestic or international level are considered a confidence-boosting advantage.

Cyprus has a relatively simple and transparent tax system with one of the lowest corporate tax rates in the EU and several potential exemptions for both corporations and individuals. Due to the range of benefits for residents and non-residents alike, the Cypriot tax system provides a welcoming business environment for companies of any size or structure.

Some basics of the Cyprus tax system:

A 12.5% corporate income tax rate;
EU & OECD compliant;
Access to EU directives (e.g. Parent-Subsidiary);
Double tax treaty network with over 60 countries;
Dividend participation exemption (subject to conditions);
Exemption from tax on gains from the disposal of securities (shares, bonds etc.);
National interest deduction on equity applies to all taxpayers and business activities;
No withholding taxes on interest and dividends;
No taxation on capital gains (under conditions);
No succession taxes;
50% exemption on annual employment income of €55,000 and above for foreign nationals working in Cyprus;
No tax on dividends, interest and rental income of non-domiciled individuals.

To facilitate investors, the Ministry of Finance introduced substantial tax incentives for natural persons who commit resources to eligible start-ups and projects approved as “Certified Innovative Businesses”. The Deputy Ministry of Research, Innovation and Digital Policy – the authority responsible for approving and certifying such businesses – has set up a list for the purpose of identifying these investment targets in Cyprus.

Getting your business funded

Getting your business funded

Start-up incubators

Government grants

Bank funding and loans

Tax and other incentives

Getting your business funded

Getting your business funded

Start-up incubators

Government grants

Bank funding and loans

Tax and other incentives

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