Cyprus Film Scheme

Cyprus Film Scheme

Cyprus is rapidly establishing itself as a competitive hub for film and audiovisual production in Europe and the Mediterranean region. Thanks to its unique combination of attractive climate, modern infrastructure, and supportive government policies, the island offers exceptional opportunities for filmmakers and investors alike.

A key instrument in this development is the Cyprus Film Scheme, a government-backed program designed to stimulate film production through generous financial incentives. This article provides a comprehensive overview of how the scheme works, its benefits, eligibility criteria, and its impact on Cyprus’s economy.

Background and Legal Framework

The Cyprus Film Scheme was officially launched in 2017 following the Council of Ministers’ decision (No. 83.415). It aligns with international standards for audiovisual production incentives and has been periodically updated to meet industry needs and economic goals.

The scheme offers a cash rebate of up to 45% on eligible production expenses incurred in Cyprus, along with tax credits and VAT refunds aimed at attracting international producers and boosting local industry growth.

Key Benefits of the Cyprus Film Scheme

• Up to 45% cash rebate on qualifying local expenditures related to production.

• Tax credits and allowances for investments in equipment and infrastructure.

• VAT refunds on goods and services used in production.

• Transparent, guaranteed payment timelines with cash rebates paid within 90 working days post-audit.

• Government support to minimize bureaucratic hurdles.

• Employment generation with a mandatory requirement to hire a minimum of three local professionals per project.

Eligibility and Participants

The scheme is open to Cypriot registered companies and foreign producers collaborating with local entities. It supports large production houses and small to medium enterprises (SMEs), promoting the growth of Cyprus’s creative sector.

Requirements and Conditions

To qualify for the Cyprus Film Scheme, productions must meet the following conditions:

• Minimum qualifying expenditure of EUR 200,000 on Cyprus territory.

• Employ at least three local professionals across creative and technical roles.

• Adhere to the arm’s length principle for transactions with related parties to ensure market pricing.

• Provide comprehensive documentation and financial reporting for all expenses.

• Undergo an independent audit conducted by certified auditors.

• Majority of filming and production activities must take place in Cyprus.

Application Process and Project Lifecycle

1. Submission of application including detailed budget and production plan via Invest Cyprus.

2. Temporary approval and issuance of a provisional certificate allowing production commencement.

3. Execution of production involving local workforce and services.

4. Final audit and verification of eligible expenses.

5. Issuance of final certificate and cash rebate payment within 90 working days.

Economic Impact and Industry Growth

Since its inception, the Cyprus Film Scheme has attracted significant international projects, including collaborations with Netflix, Channel 4/5, and Canal+. In 2023, production volume exceeded EUR 12 million, reflecting robust growth.

The program has facilitated hundreds of jobs for local professionals and positively affected ancillary sectors such as tourism, logistics, and IT services, establishing Cyprus as a key Mediterranean production hub.

Why Choose Cyprus for Film Production?

• Unique and diverse locations ranging from mountains and forests to beaches and historical sites.

• Strategic geographic location close to Europe, Asia, and the Middle East.

• Modern infrastructure including international airports, highways, and high-speed internet.

• Skilled workforce fluent in English with expertise in audiovisual and IT sectors.

• Stable and transparent legal framework conducive to doing business.

The Cyprus Film Scheme is a highly effective government initiative that reduces production costs and enhances the island’s investment appeal. With high cash rebates, tax incentives, and comprehensive support, Cyprus is becoming one of Europe’s most attractive destinations for film production.

If you are looking to expand your international production portfolio and require legal and tax expertise, Hadjivangeli offers full support throughout the application process and project implementation.

This publication has been prepared as a general guide and for information purposes only. It is not a substitution for professional advice. One must not rely on it without receiving independent advice based on the particular facts of his/her own case. No responsibility can be accepted by the authors or the publishers for any loss occasioned by acting or refraining from acting on the basis of this publication. This article is for informational purposes only. For further advice, please contact us at the contacts listed on the site.