7. PROCEDURES FOR THE ESTABLISHMENT OF AN INTERNATIONAL BUSINESS COMPANY AND MAIN INCENTIVES
The establishment of an International Business Company in TRNC is subject to the approval of Ministry responsible for economic matters.
Foreign real person, foreign corporate bodies and non-residents may apply to the Ministry responsible for economic matters for the purpose of carrying on International Business Company operations.
• The minimum paid -up capital required of International Business Company is €20.000
• Charge payable on application is €500. This application fee is never returned to the applicant under any circumstances. This amount can be increased or decreased 50% by the Council of Ministers.
• The Ministry evaluates applications and if deemed suitable gives a provisional licence within 15 days at the latest.
• Having received the provisional licence the applicant has to complete the registration procedure at the Official Receiver and Registrar within a period of two months . Otherwise the provisional licence shall be deemed invalid.
• An International Business Company, within one month at the latest after completion of the registration procedure, has to submit a main contract, regulation, opening balance sheet and one set approval document to the Ministry responsible for economic matters in order to receive an operation licence .That application is concluded within 15 days at the latest.
• An International Business Company, within two months at the latest after receipt of the operation licence from the Ministry, has to specify its place of business, must commence business according to it’s main contract, otherwise the operation licence shall be deemed invalid.
• International Business Companies shall perform all activities aimed at overseas (Off –Shore) and derive income from activities abroad .
• International Business Companies can not provide financial resources from banks, credit companies and real person or corporate bodies in TRNC.
• This kind of companies run their activities without being dependent to Income Tax Law, Money and Foreign Exchange Law and Corporation Tax.
• International Business Companies shall be subject to tax at a rate of 2.5% on taxable income to be ascertained under the provisions of the Corporation Tax Law and Income Tax Law. This Tax should be paid within five months at latest to the Income and Tax Office after each accounting period.
• International Business Companies must carry on their activities and accounting enrollments according to New Turkish Lira and/or convertible exchange units.
• International Business Companies may transfer abroad, earnings and resources they have gained and transferred from abroad freely.
• International Business Companies must employ at least one personnel resident and national of TRNC. If International Business Companies employ more than one personnel, the number of foreign personnel must not exceed three times of resident and national of TRNC personnel.
• International Business Companies have to pay €2000 business fee for carrying on business by opening an office or €5000 business fee for carrying on business without opening an office. These fees must be paid within 30 days at the latest after official registration and every year in January to the Revenue and Tax Office.
• These companies must pay half of the capital fee to the government during their registration, increasing of capital and transfer of share.