We are introducing a series for newsfeeds each one devoted to a different factor to be considered when deciding to set up presence or relocate a business to Cyprus. From setting up a company to hiring or relocating employees and from sourcing a suitable place to obtaining any necessary licenses, visas and permits, there are so many aspects to consider. It is crucial to have a complete picture of the project as a whole, as well as of its various stages. At the same time, it is equally important to have support and guidance from qualified local professionals, who will direct you and assist you through the whole process.
We will start this series of newsfeeds by examining aspects related to human resources, whether these relate to hiring employees from the local market and/or relocating existing personnel from abroad. Instead of examining this on a purely theoretical basis, we will go through a case study, looking at how we handled this for one of our clients, a shipping group, with UK origins and presence in many countries around the world.
The first issue the particular group was considering was whether it should mainly relocate personnel, mainly from its UK office, to set up the office in Cyprus or whether it should restrict relocation considerations to key/management personnel and resort to the local market for the rest of the positions. To this respect we undertook to prepare an employment market study in order to provide information on availability of qualified personnel, as well as on employment benefits, statutory and customary employer obligations and other considerations. With Cyprus being a leading and reputable shipping hub, especially for what concerns ship management activities, it was a rather easy decision the one taken by the client to opt for local personnel.
Following that decision the next step was to come up with job descriptions and invite applications for employment. Once we made the preliminary screening, we came up with a shortlist of people for each position and conducted the second interviews in the presence of managerial personnel of the client. Employment terms were agreed with the selected persons and the relevant employment agreements were drafted.
Having dealt with the local staff, the next task was to focus on people who would relocate from abroad. Cyprus offers some very important tax incentives for managerial/highly paid personnel relocating to the country, such as a 50% tax exemption on employment income in case this exceeds EUR100,000 per annum, a “non-dom” regime, a 60-days tax residency scheme and many more. You can find more on these incentives in our relevant publications, which can be found on a dedicated page of our website.
We handled the registration of the relocated personnel with the Immigration Department, the Social Insurance Services and the Tax Department and we assisted with making the relocation as smooth and worriless for them and their families. We helped in locating private residences, arranging for phone and internet connections, registering kids for school and private classes, etc.
We have then assisted the Cyprus company established in coming up with a package of employment benefits based on group guidelines, including obtaining a medical insurance for employees and their families as well as participating in a multi-employer pension scheme.
On an ongoing basis we provide support services in relation to employment, such as payroll including payment of employment-related taxes and contributions, preparation and submission of tax computations for the employees, hiring or replacing staff, assisting with new relocations from abroad or people returning to their country and much more.
This concludes our coverage on the employment related matters related to setting up in Cyprus. In our next feature we will focus on the formation or redomiciliation of a company, sourcing and appointing officers, locating premises and many more. As always, we are at your disposal for any further information or clarification and for considering any specific enquiries, concerns and ideas you may have.