If you are looking for a stable jurisdiction to set up a company, take a look at Northern Cyprus. It is more than a tourist destination: entrepreneurs from across the globe come here to form a legal entity and take advantage of wide business opportunities, beneficial tax rates, and business-friendly local laws. Why form a trust company? Well, this is an entity you can use to get reliable protection for your property. If asset protection is among your top priorities, we recommend exploring the Turkish Republic of Northern Cyprus as a good option. If you are interested in more details, you can read information on trusted websites like InternationalWealth before you make a final decision.
Pros of Northern Cyprus
The local government is attempting to make the republic more than just a resort, so it is making an effort to create an advantageous business environment that will be welcoming to company owners from abroad. The taxation policy is flexible enough to make your business profitable, and there are free economic zones where you can have special conditions.
Let’s pinpoint some benefits of opting for TRNC:
- Affordable real property. We are talking about both commercial and residential real estate: you can buy or rent an office or a house here at a good price.
- Economic stability. Potential investors value Northern Cyprus highly as it has been steadily growing in recent years in terms of GDP.
- Legal residence. If you are interested in the local residence permit, you will be able to get it in a simplified procedure after you start a company.
- Geographical location. Start your company at the crossroads between Asia, Africa, and Europe to simplify international trade.
And if you want to operate in the field of tourist services or hotel/restaurant business, Northern Cyprus is an excellent choice.
Trust Company: Basics
A trust company is an entity that mainly focuses on third-party property management to ensure the confidentiality of beneficiaries and the protection of their interests. Trust companies are your legal protection against legal claims.
Let’s take a closer look at their advantages:
- Effective planning of your finances. Plan your pension or inheritance with the help of a trust company.
- Passing down your inheritance to heirs. Trust companies are often used to provide financial well-being for future generations.
- Tax optimization. If the tax burden in your country is too high, you can transfer your business or property to Northern Cyprus to enjoy flexible taxation.
- Asset protection. Your creditors will not be able to take away your funds, securities, real estate, or any other property as they technically belong to an organization that is in no way connected with you.
- Confidentiality. Wealthy people will be able to conceal the fact that they own certain assets – and it is done in an absolutely legal way!
A trust company set up in Northern Cyprus is a flexible entity, so you can easily customize it to suit your needs.
Trust Company in TRNC: General Characteristics
- The legal form you will get is a limited liability company.
- You are required to arrange for at least 2 co-owners. More than half of the company’s shares (at least 51%) must be owned by a local citizen, while the remaining part may belong to a foreigner.
- A secretary is a mandatory position in the company.
- You are also required to appoint at least two directors, an actual director and a nominee director.
- The mandatory authorized capital equals 25,000 euros. Some activities may require a much larger amount: for instance, a currency exchange company must have the authorized capital of at least 100,000 euros, while the one that carries out its activities in the field of financial leasing or factoring must have 2 million euros to conduct its activities. 49% of the required amount is reserved in the bank account while the company is being registered (for 2 to 4 weeks).
Important Considerations
Here are the activities that foreign companies can engage in:
- Currency exchange
- Real property sale
- Medicine
- Education
- Construction
- Factoring
- Other activities allowed for local companies.
Keep in mind that tourism is excluded from this list.
The trust company has the right to purchase real estate, whether it is residential or commercial.
Documents to be submitted to establish a trust company:
- A letter from the bank to confirm that 49% of the authorized capital has been reserved.
- A lease agreement/utility bill with a residence address in TRNC.
- Proof of place of residence in Northern Cyprus.
- The foreign citizen will need to provide a clean criminal record.
- Passport of the foreign founder and ID of the founder who is a TRNC citizen.
A letter of guarantee issued by the bank in the name of the company’s director will also be required.
TRNC Trust Company: Benefits
Let’s look at the main takeaways of forming a trust company in Northern Cyprus:
- After 6 years of operation in the country, you will have the right to obtain a permanent residence permit.
- You will be able to take advantage of the products offered by Turkish banks as there are a lot of branches in Northern Cyprus.
- You will be able to open a local corporate account and withdraw/deposit funds without any restrictions.
- You will have the right to acquire work visas for employees and business visas for ownersю
- The inner market of Northern Cyprus is open for your activities.
- Finally, if you want to become a citizen of the Turkish Republic of Northern Cyprus, you will be able to receive this status after 10 years of work.
Trust Company Maintenance Expenses
Let’s first look at the monthly expenses you will have to incur:
- VAT (varies from 5 to 20% depending on the products and services)
- Payroll taxes (pension fund and social security deductions)
- Nominee founder’s fee
- Accountant’s fee
Annual expenses will include the following:
- Income tax (23.5%)
- Municipal permission to have an office and a sign
- Visas for employees and directors
- License extension fee
Interested in establishing a trust company (or other company type) in Northern Cyprus? You can click on the above link to get more detailed information or contact an expert to discuss the possibilities at no fee (use the live chat during office hours). We wish you luck with your business in Northern Cyprus!
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