Setting up your Business Company in Malta

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General Information

Malta ’s strategic geographical location played a decisive role in its history and continues to play a very important part in its economic, political and cultural development and prosperity today. Having implemented a sound legislative framework over the past decade, Malta’s accession as a member of the European Union has stimulated significant developments in the islands’ economy, brought about principally by a boost of inward direct investment into the country. With its highly educated workforce and the comparatively lower cost of professional services when compared with other EU centres, Malta has become firmly established as a reputable business and financial centre offering attractive business solutions for individuals and international corporations alike.

The population of the Islands is approximately 400,000. Maltese society is homogenous having its own identity and language. The natural population growth has in recent years been supplemented by a net inflow of Maltese who had previously emigrated to America, Canada, Australia and the United Kingdom.

With a Gross Domestic Product growth rate of 6.6% in 2018, Malta remains one the best performing economies in the European Union.

When a prospective business investor takes into account the country’s advantageous tax regime, skilled workforce, modern infrastructure and connectivity to European and other markets, the appeal becomes greater.

As an EU member, Malta provides business operators with an EU-compliant, yet flexible domicile. In addition, Malta’s allure also lies in the fact that it has a vibrant Mediterranean culture and excellent standard of living for investors and potential employees relocating from overseas.

As a European Union member state with a gateway to Africa, there are many benefits when you are registering a company in Malta.

The island nation is a member of the Schengen zone and has a positive ‘can do’ attitude when it comes to business.

The first thing that any prospective business owner must do, is decide on a name to register with the Malta Financial Services Authority’s Registry of Companies.

Advantages to Set Up Your Business Company in Malta

Setting up a company in Malta can enable you to benefit from a variety of advantages that our country offers to non-resident who choose to incorporate their company in Malta. The following are the main benefits that Malta can offer to such companies.

Taxation Benefits

Malta has a full-imputation system of corporate taxation and therefore any income tax that is paid by a Maltese company is fully imputed or credited to the shareholder who receives dividends of the company, enabling the same to benefit from the full relief of economic double taxation of corporate profits. Although the standard rate of taxation in Malta currently stands at 35% of the chargeable income of the company, a shareholder of such company would be entitled to a refund of any tax paid by the company of 5/7ths, 6/7ths or 7/7ths depending on the source of income of the company, which typically results in an effective net tax rate of approximately 10%, 5% or 0% respectively. Such refund may be reduced if double taxation relief is claimed on the income and is given within a period of as little as 3 weeks following the day on which the refund becomes due.

Low Incorporation and Maintenance Costs

A company can be set up in Malta with a minimum share capital of Euro 1,165, 20% of which should be paid up. This means that the minimum share capital that should be deposited to incorporate a company in Malta is Euro 245. The minimum Registry fee required to be paid is Euro 240 with minimum annual payments of Euro 100, a small price to pay for the incorporation of a company in a reputable jurisdiction which is also a Member of the European Union!

Exemption from Duty on Documents

Malta companies carrying out international activities are exempt from duty on documents, which effectively means that transfer of shares and increases of share capital of the company are exempt from duty.

Double Taxation Treaties signed

Malta has signed over fifty double taxation treaties, with the latest being the Malta – Russian Double Taxation Treaty which should come into force at the beginning of next year.

Capital Gains Tax

Capital gains tax which is derived by non-residents on transfers of shares and increases of share capital are not subject to tax in Malta if the assets of the company do not include immovable property situated in Malta;

Other Benefits of Incorporating a Company in Malta

No withholding tax on the payment of dividends, interest or royalties;

No controlled foreign company legislation or transfer of pricing rules;

No thin capitalization rules;

No exit taxes, wealth taxes, payroll-based tax or trade tax.

Should you wish to register your Business Company in Malta, Have any question or matter You would like to discuss or clarify with us

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