Hiring new talent is an exciting step in any business. But what if you find the dream candidate, only to learn that they’re located in Cyprus?
It might not be the sticky situation you imagine! Cyprus has a rapidly growing economy and many growth opportunities, and international companies can easily start doing business in Cyprus with a PEO who hires, pays, and manages team members on their behalf.
At Skuad, we enable companies to scale and hire global talent in 160+ countries while remaining 100% compliant with local laws and never having to establish a local legal entity of their own.
So what is a professional employer organization (PEO)? Let us tell you! Keep reading.
What is a PEO?
A PEO is a provider that helps SMEs, startups, and small businesses expand globally by providing HR services. PEOs handle hiring, onboarding, payroll, compliance, benefits, and employment contracts. Partnering with a PEO will allow your company to offer competitive compensation and benefits packages to position your company as a leader in Cyprus.
PEOs are a great way to discover top talent across the globe. If you partner with a PEO, such as Skuad, you can focus less on the HR tasks and more on the core business operations.
When you use a PEO, you form a co-employment model. The PEO serves as the documented employer and handles all HR, taxation, benefits, and compliance activities. You handle daily operations of, and delegation to, the team you’ve hired.
Your company can easily expand globally while maintaining the employment laws in Cyprus. Are you curious about if a PEO is right for you? Get in touch with one of the Skuad team to discuss your options.
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What are the benefits of using a PEO in Cyprus?
There are many benefits to working with a PEO, from having an expert partner on hand to manage HR functions to the ability to scale globally for a fraction of what it costs to incorporate.
We’ll discuss more below about how a PEO can help ambitious and growing companies to thrive.
Hire top talent from Cyprus
Location shouldn’t be a constraint when hiring top talent. Finding the right worker for the job sometimes means looking outside of your local vicinity. The capabilities for companies to work remotely make global hiring possible.
Position your company as a global competitor
When all other companies around you are scaling globally but you are stuck, that doesn’t give you a competitive advantage. Build your reputation as a global competitor by hiring workers in Cyprus.
A PEO in Cyprus will know exactly what Cypriot employees expect so you can attract the very best talent. Not only will a PEO help you manage employees, but it will help you position your company as a global force.
Save on unnecessary costs
If you incorporate in Cyprus, you are then responsible for managing the entity and the employees. This includes annual fees, registrations, and more. You can save the time and cost of doing business in Cyprus by partnering with a PEO.
A PEO is a much cheaper option for startups and SMEs without extensive resources. Most businesses cannot hire a full in-house HR team and legal professionals to navigate setting up a global entity legally.
Interested in learning more? Contact Skuad for a free intro call.
Discover in-depth insights to global markets
Maybe your business has plans to launch entities in new markets around the world. What better way to understand global markets than to get a head start and hire from those countries first?
You’ll get insight into the work ethic and culture of working in Cyprus before taking the plunge and opening an entity (if you even need to).
Avoid setting up a new entity in Cyprus
If you do not partner with a PEO or another service provider, the only way you can do business in Cyprus is to incorporate a legal entity in the country. This is a time-consuming and expensive process that will take help from external professionals, such as Cypriot lawyers, to achieve it.
A PEO enables you to hire without the entity. The PEO already has an entity established in Cyprus, thus meeting the requirement needed to do business there.
Expand cultural awareness
Cultural differences can cause miscommunications or awkward situations. You can avoid any mishaps by working with a PEO. The PEO’s staff are experts in Cyprus employment contracts, labor laws, and cultural expectations. They can advise you on cultural expectations you may not be aware of so you can avoid offending anyone.
For example, did you know most Cypriots prefer face-to-face meetings? Building relationships is a big deal in Cyprus, so it’s important to connect regularly.
Full compliance with Cyprus labor laws
Every country has its own set of labor laws and regulatory requirements. It’s up to the employer to understand these and follow them to avoid penalties and fines. Labor laws are enforced strictly in Cyprus, so you must understand them.
Did you know that a typical work week in Cyprus is capped at 48 hours with overtime included?
Or that requesting your workers to work overtime hours is a complex and sensitive task that you must tread lightly?
Read more about nuances in payroll and Cyprus tax rate guidelines below.
Payroll taxes and deductions
Employers must contribute at the Cyprus corporate tax rate. They are also responsible for deducting and paying the Cyprus income tax rates for employees. Employees are paid monthly and the currency is the Euro.
- 8.3% for social insurance
- 2.65% to the General Health System
- 0.0% to 35% in income taxes
- 8.3% for social insurance
- 2% for social cohesion
- 1.2% for redundancy
- 0.50% for training and development
- 2.9% to the National Health System
- 8% to the holiday fund (if applicable)
Paid leave in Cyprus
Sick leave is a little complicated in Cyprus with 156 paid days at 60% of pay. Sick leave is a government-funded program and increases based on dependents (including spouses).
Maternity and parental leave are both 18 weeks of paid leave. Parental leave is only available after 6-months of service. There are also leaves for adoption, widows, and widowed parents.
Employers are required to provide 20 days of paid time off for workers who work 5 days a week. The days increase to 24 for employees who work 6 days a week. There are also 13 public holidays.
Sort yourself a free Skuad demo to better understand employment laws in Cyprus.
What does it cost to build a team in Cyprus?
The cost of doing business in Cyprus will vary based on the direction your company goes. If you choose to go with a professional employer organization in Cyprus, your costs will be a fraction of what you will pay for incorporating a new entity.
Discover more about both options below.
Cyprus company registration
There are several steps you must complete before setting up a business in Cyprus. First, you have to gather the required documents needed for Cyprus company registration. Then you must submit them to the proper authority and wait for approval. This can take about 5 days. Following approval, you will be required to pay related fees.
To do business in Cyprus, you have to have a working office in the country. You must appoint a director to manage local operations and maintain compliance because businesses are audited annually in Cyprus.
Besides the initial setup fees, there are several maintenance costs for working in Cyprus. There are annual fees, office maintenance, and taxes to consider. It costs significantly more time and money to incorporate in Cyprus.
PEO services in Cyprus
The cost of doing business in Cyprus is significantly less if you work with a PEO. The cost for each worker depends on the PEO you choose to work with. For example, if you work with Skuad as PEO, you can get started for free. You get peace of mind and cost savings with a PEO! What more could a company ask for?
Our PEO packages start at $19 a month. This covers all HR functions, including payroll, compliance, and documentation. You get to choose how big your team will be in Cyprus — you can hire one worker or 100! We can help you every step of the way.
We also offer employer of record services for $199 a month. Enterprise clients can request a quote here.
Start expanding into Cyprus today
Are you ready to expand your operations and hire top talent from Cyprus? Contact us to book a free demo and see for yourself how our easy-to-use platform would help your organization thrive.