Family office in CyprusOverview
There is no family office statute in Cyprus. A single-family office that manages only one family's wealth, without offering services to others, generally falls outside financial regulation. The perimeter is set by activity: investment advice or portfolio management for third parties requires a Cyprus Investment Firm (CIF) licence from the Cyprus Securities and Exchange Commission (CySEC) under the Investment Services and Activities and Regulated Markets Law 87(I)/2017, with initial capital depending on the services provided; acting as trustee, director or nominee for third parties by way of business requires an Administrative Services Provider licence under Law 196(I)/2012; and managing pooled vehicles brings the Alternative Investment Funds Law 124(I)/2018 and the AIFM rules into play. A private trust company that acts only for specific family trusts and does not offer trustee services to the public does not need a licence.
A typical Cyprus structure places a Cyprus International Trust (CIT) or a foreign trust at the top, a private trust company as trustee, and separate holding and management companies below. The CIT, governed by the International Trusts Law 69(I)/1992 as amended in 2012, requires at least one Cyprus-resident trustee, offers firewall provisions against foreign forced heirship claims and judgments, and benefits from confidentiality, although beneficial owners must be recorded in the trust register kept by CySEC. For pooled or co-investment portfolios, families use a Registered Alternative Investment Fund (RAIF), which is listed rather than authorised and must be managed by an external authorised manager, or an AIF with a limited number of persons (AIFLNP). Foundations under Law 104(I)/2017 are non-profit bodies and are generally not used as private wealth vehicles.
The 2026 tax reform, approved by Parliament on 22 December 2025 and published on 31 December 2025, changed several key parameters from 1 January 2026. Corporate tax rose from 12.5% to 15%, tax losses can be carried forward for seven years, all Cyprus-incorporated companies are treated as resident unless a treaty provides otherwise, deemed dividend distribution on profits earned after 1 January 2026 was abolished, the defence contribution (SDC) on actual dividends fell from 17% to 5% for domiciled individuals, the Stamp Duty Law was repealed and gains on crypto-assets are taxed at 8%. Companies generally remain exempt on dividend income and on gains from the sale of securities, and Cyprus keeps its broad treaty network, so a Cyprus holding remains a common EU base for operating groups.
For individuals, the non-domiciled regime is the core attraction: a Cyprus tax resident without a Cypriot domicile of origin pays no SDC on dividends, interest or rental income for 17 of 20 years. Under Article 3D of the SDC Law and Tax Department Circular 2/2026, those who become deemed domiciled can extend non-dom treatment for up to two further five-year periods by paying EUR 250,000 upfront for each period, an irrevocable and non-refundable election. Residence for non-EU families is available through the permanent residence permit under Regulation 6(2) of the Aliens and Immigration Regulations, with an investment of at least EUR 300,000 and secured foreign income of EUR 50,000 a year. Cyprus abolished citizenship by investment in 2020, has no inheritance tax, and is an EU member that is not yet part of the Schengen Area.
Key benefits
- Clear perimeter: a single-family office or a private trust company acting only for the family needs no CySEC licence
- Holding company exemption on dividend income and on gains from the sale of securities, with a wide treaty network
- No deemed dividend distribution on profits earned from 2026, giving families control over the timing of distributions
- Non-dom regime with no SDC on dividends, interest and rents for 17 years, extendable by up to ten more years
- Cyprus International Trust with firewall protection, at least one local trustee and a common-law tradition
- RAIF and AIFLNP fund vehicles for co-investment, quick to establish under EU fund rules
- No inheritance tax and, since 2026, no stamp duty
- Permanent residence route for non-EU family members and an English-speaking professional services market
Requirements
- Define the office's scope: investment advice or portfolio management for third parties requires a CIF licence under Law 87(I)/2017; trustee, nominee or directorship services by way of business require an ASP licence under Law 196(I)/2012
- Incorporate holding and management companies under the Companies Law (Cap. 113) and register beneficial owners with the Registrar of Companies' register
- Establish management and control in Cyprus: majority of directors ideally Cyprus resident, board meetings held and minuted in Cyprus, and office and staff proportionate to the activity
- For a Cyprus International Trust, appoint at least one Cyprus-resident trustee, prepare the trust deed and record the trust and its beneficial owners in the CySEC trust register
- Where a PTC is used, limit it to acting for the family's trusts and not to the public, or obtain an ASP licence
- Apply AML/CFT requirements of Law 188(I)/2007: regulated providers, banks and administrators will carry out full due diligence and source-of-wealth checks, and family entities performing fiduciary or investment functions may become obliged entities
- Classify each entity for CRS and FATCA and file annual returns, audited financial statements and tax returns
- Review new withholding taxes on dividends paid to entities in listed low-tax or non-cooperative jurisdictions and the new disguised-dividend rules
- For non-dom extension, apply to the Tax Department under Circular 2/2026 and pay EUR 250,000 upfront for each five-year period
Structure designs
Cyprus holding and management company (single-family office)
A private company holds operating subsidiaries and portfolios while a sister management company employs the family office team. Outside CySEC licensing when it serves only the family; the post-2026 rules remove deemed distribution and keep the dividend exemption.
Cyprus International Trust with a private trust company
A CIT under Law 69(I)/1992, with a family PTC as trustee and the holding companies below. Suits succession and asset protection planning, with firewall provisions, at least one Cyprus-resident trustee and beneficial owners recorded in the CySEC trust register.
RAIF for co-investment
A Registered Alternative Investment Fund listed with CySEC and managed by an external authorised manager. Suits families pooling capital with partners or other families who need an EU fund wrapper without full product authorisation.
AIF with a limited number of persons (AIFLNP)
A CySEC-authorised fund for a small, defined group of investors, often used as a family investment vehicle. Offers a regulated structure with fewer investor-protection requirements than retail funds.
Licensed multi-family office
CIF initial capital from EUR 75,000
For an office serving several unrelated families: a CIF licence for investment services and, if trustee or nominee services are offered, an ASP licence. Requires fit-and-proper management, capital, compliance and AML functions.
Step-by-step process
- 1
Family and residence review
Map family members, domicile and residence positions, assets and goals, and confirm whether the office will serve one family or several.
- 2
Structure and tax design
Choose the holding, management company, trust or fund layers; model the 2026 rates, non-dom status and treaty positions for each family member and asset.
- 3
Governance documents
Draft the trust deed and letter of wishes, PTC constitution, shareholder agreements, family charter and investment committee terms.
- 4
KYC and incorporation
Complete due diligence, incorporate the companies, appoint directors and the Cyprus-resident trustee, and file beneficial ownership in the company and trust registers.
- 5
Licences and funds
Where needed, file a CIF or ASP application with CySEC, or establish a RAIF through an authorised manager or an AIFLNP with CySEC authorisation.
- 6
Substance, banking and residence
Lease offices, hire staff, open bank and custody accounts, arrange tax residence certificates and apply for permanent residence for non-EU family members.
- 7
Annual compliance
Audited accounts and tax returns, register updates, CRS/FATCA reporting, AML reviews, non-dom monitoring and periodic structure reviews.
Typical documents
- Certified passports and proof of address for family members, directors and beneficial owners
- Source-of-wealth and source-of-funds evidence for the family and each asset
- Family tree and summary of domicile, residence and existing estate plans
- Memorandum and articles of association for holding, management and trustee companies
- Trust deed, letter of wishes and trustee acceptance
- Beneficial ownership declarations for the company register and the CySEC trust register
- Board composition, director CVs and evidence of Cyprus management and control
- For a CIF, ASP or fund: business plan, programme of operations, fit-and-proper questionnaires and AML manual
- For residence: proof of investment of at least EUR 300,000, evidence of EUR 50,000 annual foreign income and police clearance certificates
How Legal Wealth helps
Legal Wealth helps families assess whether Cyprus should host their holding, trust, family office team or residence, and builds the structure with Cypriot lawyers, trustees, fund managers and tax advisers. We model the 2026 tax rules and non-dom position for each family member, design trust and governance layers around succession goals, coordinate CySEC filings, banking and residence applications, and keep beneficial ownership and reporting current. Our approach is compliance-first, discreet and documented at every stage.
Enquire with Legal WealthFrequently asked questions
Does a single-family office in Cyprus need a CySEC licence?
Generally not, if it manages only one family's wealth and does not offer services to others. Investment advice or portfolio management for third parties requires a CIF licence, trustee or nominee services by way of business require an ASP licence, and pooled funds fall under the AIF Law.
What did the 2026 tax reform change for family holding companies?
From 1 January 2026 corporate tax is 15% instead of 12.5%, deemed dividend distribution no longer applies to new profits, the SDC on dividends for domiciled individuals is 5% instead of 17%, stamp duty has been abolished, and all Cyprus-incorporated companies are treated as resident unless a treaty provides otherwise. New withholding taxes apply to dividends paid to entities in listed low-tax jurisdictions.
How does the non-dom extension work?
Individuals without a Cypriot domicile of origin who become deemed domiciled after 17 years of residence in 20 can elect, under Article 3D of the SDC Law, to keep non-dom treatment for up to two further five-year periods by paying EUR 250,000 upfront for each period. The election is irrevocable and the payment is not refundable; the procedure is set out in Tax Department Circular 2/2026.
Is a Cyprus International Trust private?
Trust terms are not public, but the beneficial owners of express trusts administered in Cyprus must be recorded in the register maintained by CySEC, which is accessible to competent authorities and obliged entities under the AML framework. The trust must have at least one Cyprus-resident trustee.
Can family members obtain residence in Cyprus?
Non-EU nationals can apply for permanent residence under Regulation 6(2) of the Aliens and Immigration Regulations by investing at least EUR 300,000 in qualifying property, company shares or funds and showing EUR 50,000 annual foreign income, plus EUR 15,000 for a spouse and EUR 10,000 per child. Citizenship by investment was abolished in 2020.
Is there inheritance tax in Cyprus?
No. Cyprus abolished estate duty in 2000, and the Stamp Duty Law was repealed from 2026. Forced heirship applies only to individuals domiciled in Cyprus, and the International Trusts Law contains firewall provisions against foreign forced heirship claims.
Last reviewed: 2026-10. Requirements, fees and timelines change. Information is general, reviewed on the date shown, and is not legal or tax advice.
