A Cyprus company can be used tax efficiently as an employment company. It can employ staff on overseas assignments and charge operating companies at a cost plus basis. The profits will be taxable in Cyprus at the rate of 10% and the taxable profits of the operating companies will be reduced accordingly. In addition, the salary costs for the operating companies will be significantly reduced as social security and other employer contributions are much lower in Cyprus than most other EU countries. The employees will not be subject to tax in Cyprus.