Introduction
The Republic of Cyprus is the country situated on an island in the north-east part of the Mediterranean Sea. Cyprus is a member of the European Union and the European Economic Area. The Republic is a member of the Organization for Economic Cooperation and Development OECD. The country is stable both economically and politically. The law valid in this country follows the example of the British common law system. The Republic is the party of over forty double taxation conventions and is not on the blacklist of OECD countries using a harmful tax competition.
This jurisdiction is competitive in terms of conditions on which it is possible to set up and conduct business activity in its territory. Foreign entrepreneurs who are going to establish a holding company in this country may count on numerous tax privileges. Liberal solutions predicted in the Cyprian tax law may be also used by physical persons who intend to locate their business activity here.
It is also worth emphasising that the changes that are to be introduced into the Polish-Cyprian double taxation convention by means of the protocol made in Nicosia on 22 March 2012 uphold majority of the presently valid preferential tax solutions that the entrepreneurs conducting their business activity in Cyprus use. Moreover, the solutions in this domain introduced by the law of the Council’s Directive 90/434/EEC and the regulations of the Council’s Directive 90/435/EEC of 22 July 1990 are still valid.
