A Digital Nomad Visa has been launched in Cyprus allowing 100 non-EU nationals the right to live and work from Cyprus. The program launches in January 2022 and is part of a cohort of new immigration and business initiatives. The aim is to attract foreign investment, talent and innovation to this bourgeoning tech hub.
Cyprus – the ideal location for digital nomad and techpreneurs
On October 15th 2021 the new strategy https://cyprus-mail.com/2021/10/15/new-strategy-launched-to-attract-investors/ to digitize the island, draw in foreign talent and facilitate innovation.
Some incentives target Information Technology and Communications (ICT) companies, streamlining the process for them to set up their companies’ operations from Cyprus and obtain residency permits for their executives.
Whilst others target expats and foreign workers who can now apply for Cypriot citizenship if they have lived in Cyprus for 5 years (or even 4 years if they are proficient in Greek). Previously, the time needed to become naturalized was 7 years.
The latter will be of great interest to British nationals residing in Cyprus who post-Brexit have been stripped of their EU mobility rights.
In efforts to attract and retain high-skilled and high-paid expats to Cyprus, foreign workers who earn over EUR 55,000 per annum may now enjoy a 50% tax exemption for up to 17 years if they meet the eligibility criteria. Currently employed workers can extend their tax benefits from the former 10 years to 17 years now. Cypriots that have lived abroad for over a decade and wish to return can also avail these income tax incentives.
Competing to attract Digital Nomads
Digital nomads are an increasingly popular category of migrant as they are location mobile and have an ever-growing purchasing power. Whether they are crypto traders, online business owners or freelance workers they represent talent, innovation and opportunity.
In fact, https://www.forbes.com/sites/oliverwilliams1/2021/10/18/exclusive-where-have-all-the-digital-nomads-gone/?sh=4fb88d0a2f0c as the 2020 pandemic made more office-bound workers location independent. They concluded that over half of those surveyed were entrepreneurs, business owners, self-employed or retirees and that the number of digital nomads was multiplying exponentially as a result of the pandemic.
As travel mobility eases the number of digital nomads will continue to rise and so too will the competition to attract them to one’s own shores.
According to Forbes, “the government of Greece, for example, estimates that if at least 100,000 digital nomads stay in the country for six months of the year, the economy would be €1.6 billion ($1.8 billion) richer every year through taxes and local spending.”
It is anticipated that more countries will jump on the bandwagon and try to lure and then (quintessentially) retain this affluent migrant class.
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Digital Cyprus: A Tech Hub
The Cypriot government is keen to transform Cyprus into a digital hub for nomadic entrepreneurs, techpreneurs, shipping and pharma companies.
They are doing so by upgrading their digital ecosystem, expanding the 5G networks across the island and ensuring there are cyber security safeguards in place. They are bringing the previously bureaucratic government processes in Cyprus from paper and facsimile to the modern digital age.
In a nutshell, in our national Resilience and Recovery Plan (RRP), we have included projects of over €280 million for the digital transition, which is one of the major pillars of the RRP.
Stelios D. Himonas, Permanent Secretary at the Deputy Ministry for Research, Innovation and Digital Policy stated at a recent press meet https://cyprus-mail.com/2021/07/03/plan-make-cyprus-ict-hub/. There is a massive push from industry groups and government agencies in Cyprus to re-brand Cyprus as a tech hub.
The latest strategy presented by President Anastasiades on the 15th October 2021 is in line with the European Commission’s guidelines and the Recovery and Resilience Funds.
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Why is Cyprus the ideal base for ICT Companies?
For decades businesses have set up holding companies in Cyprus due to its favorable double tax treaties and low corporate tax rate of only 12.5%, yet demand is now surging from Information, Technology and Communications (ICT) companies.
Innovative companies, especially those in the AI, tech and research spheres are drawn to Cyprus for a myriad of reasons. Importantly, Cyprus has Europe’s most favorable Intellectual Property regime with an effective tax rate of 2.5% and it grants protections under most of the international IP treaties including the Madrid Agreement and WIPO.
Interest is also evident from crypto-asset service providers who seek a transparent and flexible regulatory environment from which to operate. The CySec aims https://www.cysec.gov.cy/CMSPages/GetFile.aspx?guid=38342fb3-b85f-483a-830b-736fd4b76bce to ensure the island operates within an AML compliant regulatory ecosystem.
Over the past few years there has been a momentous shift towards technology companies.
Techisland – https://www.thetechisland.org/ for example, is a not for profit that promotes the development of a tech ecosystem in Cyprus. They now comprise over 7000 techpreneurs, executives and investors working together to fortify Cyprus as an innovation hub: https://www.euronews.com/next/2021/08/27/cyprus-at-a-crossroads-the-journey-to-becoming-europe-s-newest-tech-island.
Not only are ICT business owners and tech entrepreneurs making the move to operate from the island but as of January 2022 Cyprus launches a Digital Nomad Visa. Non-EU digital nomads that are location independent will soon be eligible to live and work from cosmopolitan Cyprus.
Cyprus Digital Nomad Visa
Cyprus has launched its Digital Nomad Visa commencing January 2022, which allows up to 100 applicants who come from non-EU countries to live and work from Cyprus.
The applicants may be employed, self-employed or freelance workers. Permits will be granted for one year with the right to renew for two more years subsequently. In addition, if their dependents (spouse or children) wish to come with them they can also live in Cyprus so long as they do not take up paid employment. The Digital Nomad Visa holders should earn at least EUR 3,500 per month, have medical insurance and a clean criminal record.
The EC applied pressure on the now defunct Cyprus Citizenship programme and Malta citizenship by investment programme as well. Many investors have sought other types of immigration and investment permits as alternatives.
One example is the Maltese Nomad Residence Permit. It is granted for one year (can be renewed at discretion of Maltese government) and enables holders to be employed in their home country whilst legally residing in Malta.
Greece too has launched a digital nomad visa to lure this migrant class. Another increasingly popular visa is the Portuguese D7 that allows third country nationals with sufficient means such as freelance workers, techpreneurs, cryptopreneurs and even retirees to live in Portugal.
The digital era is here.
The remote work/hybrid work mode is also here.
Both are part of the new normal accelerated by the global pandemic that turned the way we work, live and do business on its head. As with all great change comes great opportunity and those countries that embrace this change and adapt will excel.
Whether its luring foreign talented professionals through more streamlined residency permits or attracting techpreneurs and digital nomads – the pace of change is accelerating.
Those governments that embrace this digital change will have more chance of succeeding.
