Client story
Client Background
Where they started
Ilya is a co-owner of an IT company whose operational center has historically been structured as a Cypriot legal entity. The business pays taxes in Cyprus, distributes profits as dividends, and this is Ilya's primary income source. Formally, he remained a tax resident of Belarus—simply because his family lived there and circumstances evolved that way.
Why the standard route did not work
The problem stemmed from the very mechanics of CRS. The Cypriot bank where dividends accumulated is obligated to annually report account data to the country of the account holder's tax residence—that is, to Belarus. Each such report became grounds for questions: where did the funds come from, why wasn't it declared as the local tax authority interprets it, are there grounds to assess additional tax on foreign income.
What BRIDGES had to solve
Added to this was the risk of double taxation. Dividends already underwent corporate-level taxation in Cyprus, but the country of residence could claim them again at the individual level. Agreements existed, but using them in practice was difficult: each payment turned into correspondence with the tax inspector and proving the obvious.
Why a standard answer would not do
Ilya was not seeking a tax avoidance scheme but predictability. He needed a status in a reputable European jurisdiction that would, first, clearly determine where CRS reporting goes, and second, not impose repeated taxation on income already taxed at the corporate level.
I didn't hide anything and paid all I owed. But every year after the bank's report, the same conversation with the tax authority would start, as if I were guilty of something. I just wanted clear rules: here's my country, here's the rate, that's it.
