It is strongly recommended that an actual office is maintained in Cyprus, where the management and control, and preferably also the day-to- day administration of the company are exercised. Furthermore, the office should have a telephone and a fax line.
In order to enhance their substance, companies should employ an adequate number of qualified staff to run their business from Cyprus. This, however, depends on the type of business performed by each individual company.
Record Keeping Requirements
Hard copies of all relevant documents, such as corporate documents, agreements, invoices and so on, should be kept in the Cyprus based office of the company.
The accounting records of the company should be prepared and kept in Cyprus.
The bank accounts of the company, regardless of whether they are based in or outside Cyprus, should be operated from Cyprus, as it can be argued that the effective management and control of the company is where its funds are managed from.
The company should have an e-mail address and a website.
Above matters should be strongly taken into consideration if you need to strengthen the physical presence and substance of your Cyprus Company.
The issue of Substance needs to be addressed carefully, in order to limit the exposure of structures to international anti-avoidance rules which might result in losing double tax treaty benefits.
In an increasingly complex and ever-changing tax environment it is important to be pro-active.