Cyprus ceases to be an offshore jurisdiction for Russia
The Russian Ministry of Finance has recently released a new white list of offshore jurisdictions where Cyprus is no longer included.
Although a double taxation treaty was signed between the two countries last February, Cyprus was still regarded as an offshore destination by Russia until October 31.
This change presents certain advantages as regards taxation and investments for Russian companies.
Indeed, dividends from Cyprus will no longer be taxed at 9% but at 0% instead. Thus, the country will become an advantageous place for Russian holdings regarding ownership of assets abroad.
Furthermore, the tight transaction control typically enacted by the tax authorities whenever one of the parties is domiciled or incorporated in an offshore jurisdiction, shall no longer apply to Cyprus.
Finally, despite rumours of a greater information exchange between the Russian and Cyprus tax authorities, Cyprus confirms that the original agreements remain unchanged.