Sergey Kartashov (Sergejs Kartasovs) is the CEO of Generation Partners LTD, an asset management company. This Cyprus-based company deals with investing in potential IT startups and businesses. He shares his opinion related to Cyprus as the largest IT hub in Europe. Cyprus joined the European Union (EU) in 2004. It has been working hard to build a new reputation of the island in terms of attracting more foreign investors and companies since then.

Sergey Kartashov (Sergejs Kartasovs) is the CEO of Generation Partners LTD, an asset management company. This Cyprus-based company deals with investing in potential IT startups and businesses. He shares his opinion related to Cyprus as the largest IT hub in Europe. Cyprus joined the European Union (EU) in 2004. It has been working hard to build a new reputation of the island in terms of attracting more foreign investors and companies since then.

Generation Partners said that the island attracted large companies from Europe and post-Soviet states in the last five years. The foreign companies are relocating their businesses to Cyprus due to several reasons. Sergey Kartashov talked about some of the factors that make Cyprus attractive for the relocation of the business.

IP-Box Regime and Tax Benefits
According to financial experts, Cyprus is the best country in the EU to register and maintain a business. The country has already introduced the IP-Box regime to benefit IT businesses and startups. Sergey Kartashov (Sergejs Kartasovs) said about it, “However, IT companies get the best conditions in Cyprus. Cyprus is one of the few countries that have introduced the IP-Box tax regime.”

It is very easy to register a company in Cyprus. The regulatory reporting system is also very simplified on the island. Moreover, Cyprus has a flexible taxation system. These are some of the few factors that make it is the best place for a business to relocate. The country offers the lowest income tax rates (12.5%) in the European Union. The island has made agreements with various countries to avoid double taxation. The VAT system of the country offers a 2.5% to 0% tax on earnings to the companies. In the VAT system, there is no tax on the products that are purchased by the non-EU residents. For the EU residents, the value-added tax is 19%. The CEO of Generation Partners said, “Within its framework, only part of the profit from the creation or modernization of intellectual property products falls under the state duty.”

Some Difficulties
The government of Cyprus is keen to get rid ofits offshore reputation. That is why it has been gradually implementing the anti-money laundering procedures to cope with corruption. It has made it difficult for the businesses to open an account in a local bank on the island. A businessman is required to disclose its sources of income and reputation in this regard. Sergey Kartashov said, “On the one hand, this is not a pleasant procedure. On the other hand, this is the right step towards a completely new reputation of Cyprus.”

Generation Partners CEO said, “By breaking the spine of the old system, the island’s government turned Cyprus into an attractive destination for creating and relocating large international companies.” Kartashov advised that the businesses should relocate to the island after their complete formation.

There are various other countries that are competing well against Cyprus in terms of providing better conditions for businesses. These countries include Malta, Singapore, Great Britain, Ireland, Spain, Luxembourg, France, Belgium, the Netherlands, and Hungary. However, Cyprus is currently the most favorable country among them due to its flexible taxation, easy company registration, and simple regulatory reporting systems.