Ship managers

The tax exemption covers:

• Profits from technical and/or crew management
• Dividends paid out of these profits at all levels of distribution
• Interest income relating to the working capital of the company

In order to qualify ship managers must satisfy the following additional requirements:

• Maintain a fully fledged office in Cyprus with personnel sufficient in number and qualification
• At least 51% of all onshore personnel must be community citizens
• At least 2/3 of total tonnage under management must be managed within the community (any excess of 1/3 taxed under corporation tax)

The application of the tonnage tax system is compulsory for owners of Cyprus flag ships and optional for owners of non Cyprus flag ships, charterers and shipmanagers. Those who choose to enter the Tonnage Tax regime must remain in the system for at least 10 years.