Cyprus-Seychelles Collaboration through the Double Taxation Treaty by Anuj Sharma
The Cyprus-Seychelles Double Taxation Avoidance treaty came into force on November 2, 2006. The two countries however, share a history which goes well before that. There is a closeness that has always existed between Seychelles and Cyprus on the basis of
Their geographical features – their small size, location amidst several continents, flexibility to adapt to changes and a vast coastline
Their historical past (both have faced turbulent past and survived invasions. And both have been part of the Commonwealth after their independence in recent times. Mr. Makarios the Archbishop was exiled to the Seychelles in 1956. He was released from exile a year later, although he was still forbidden to return to Cyprus. He went instead to Athens and worked hard to achieve freedom for his people.
Their economy: is young and progressive, they have survived on tourism, shipping, fishing, agriculture etc. But now in order to compete and outperform their counterparts they have opened the gates of their economy for foreign investments. Through introduction of new laws, simplified procedures, fiscal incentives, inward investment opportunities and DTA treaties and many more changes, they intend to emerge as new super power jurisdictions.
Seychelles Special License Company (CSL) :
After Seychelles success with the IBC (with over 50,000 companies on register), Seychelles has diversified and now provides an excellent wider scope of vehicles for more efficient tax structures involving Protected cell companies and Limited Partnerships and the use of Special License Company to utilize the ever-increasing network of double taxation agreements. In this article, we shall examine the Cyprus-Seychelles Double Taxation Treaty and how it has opened avenues for accessing investments into EU and CIS countries.A Special License Company is a resident company with access to double taxation avoidance agreements and is liable to tax at a marginal rate of 1.5% on worldwide income. It is exempt from withholding taxes on dividends, interest and royalties. It is also exempt from stamp duties on property transfers, share transfers and other business transactions.The Company needs to submit annual returns and financial statements to the Seychelles International Business Authority within 90 days from the end of the financial year.
The Cyprus-Seychelles treaty :
The Double Taxation Avoidance treaty has been in force for well over 1 year now. The key features of the treaty are: