Getting to Grips with the Cyprus Investment Program
In an effort to attract high-level earners whilst offering them a comfortable way of life; Cyprus introduced the CIP, or Cyprus Investment Program. With this scheme, it can be possible for foreign nationals to obtain citizenship – allowing them the right to live, work and travel freely as a Cypriot citizen.
What is the CIP?
With this in mind, the CIP was put into place to provide expats simpler options to obtain Cyprus citizenship; gaining access to full EU rights. Those meeting the criteria and achieving naturalisation should be able to enjoy:
· Visa-free travel to 173 countries
· Dual citizenship
· Simple taxation regulations
· Coverage for spouses and dependents (up to the age of 28)
All nationalities are eligible to apply, successful applications are usually established within 6 months and there is currently a 5-year exit strategy in place.
How best to obtain citizenship with this program
For many high earners, the most straight-forward way to meet the requirements for citizenship is to purchase a residential property with the value of €2,000,000 (+vat) or above. If a transaction of this kind has been made within the last three years, the homeowner will have the ability to apply under the CIP. There are stipulations however, and the main one is that once purchased, the property cannot be resold for a period of 36 months.
After this time, the investor will be permitted to sell the home, but they will be required to purchase another property in Cyprus with a value of €500,000 or more. There are instances where this rule may be adjusted, but only if there is a replacement property investment (typically in the form of a property upgrade) and with permission granted by the Ministry of Finance.
Alternatively, there are options to allocate the €2,000,000 investment in other ways aimed at the property market. For instance, an individual could opt to purchase a house with ¼ (€500,000) of their initial €2,000,000 investment, and then spend the remaining €1.5 million on other properties with no set value. For instance, they could buy 3 other homes at €500,000 each, or one larger property to fulfil the entire sum.
How to proceed with an application
Once a property has been selected, the purchaser will need to work with a licenced Cypriot real estate agent. From here, a purchase agreement should be drawn up, funds transferred into a secure account and a receipt issued for the purchase (this is required for a successful request to go through).
Next, the homeowner will need to gather all of the necessary information required for their application. For British applicants, documentation will be subject to certification by an apostille or stamped by the Ministry of Foreign Affairs, as well as the corresponding Cypriot embassy.
It may be worth it at this stage for an appointed lawyer to undertake a pre-clearance review to ensure that everything has been provided, signed and verified where necessary (in applicable circumstances, planning permission and a completion certificate for the purchased property should be provided by the applicant, as well as a bank waiver).
The next step involves the approval of the application, which will usually be carried out by The Ministry of Interior within six months.
Other financial investments
While relations between the UK and Cyprus have always been amicable, both parties have an understanding that Brexit has warranted changes to the standing legislations to make citizenship easier and more beneficial for all parties involved. This has led to a range of changes being made to the CIP in the last 12 months. Outside of property investment, it can still be possible for individuals to apply for residency by making an investment into the Cypriot ecosystem.
Donations of €75,000 to specific causes can ensure a successful application, such as into the Foundation for Research and Innovation and the Cyprus Land Development Corporation. This is with the understanding that the focus will be on the betterment of new and upcoming businesses and affordable housing, to ensure the ongoing growth and advancement of Cyprus in the future.
Alternatively, a €2,000,000 investment can be allocated to assets within Cyprus, whereby an additional €500,000 must go toward the cost of a property. The €2,000,000 will therefore need to be spent on shares, equity, or bonds relating to businesses and enterprises operating within Cyprus.
Other factors to consider
In order to be eligible, the applicant must possess a residency permit, or an immigration permit. Those who have applied to gain citizenship in other EU states and failed will not be granted naturalisation via the methods outlined (or any others involved in the CIP). There may be other avenues for those in this situation to explore to gain access to live and work in Cyprus instead.
If the investors’ parents wish to become citizens, this can be possible as long as together, the parties purchase a property with a value of at least €1,000,000. Alternatively, and only when the investor has obtained citizenship, the parents can apply separately for a permit to become citizens as long as they purchase a property with a value of €500,000.