Registration a company in Malta

or tax planning using Maltese companies

Registering a company in Malta

Malta is a very friendly and independent state. The legislative system is based on English legislation, but it includes the components of the continental legal family countries legislation. This country is striving to become the center of the European business community.

On the territory of the European Union, Malta has a fairly competitive tax regime that significantly expands business opportunities between jurisdictions, on the basis of signed treaties on eliminating double taxationwith different countries. This includes both Ukraine and Russia. However, Malta does not fitthe classical understanding ofoffshore.

Malta is a very flexible country with respect to foreign business. It provides the opportunity to create a business from scratch, or to transfer an existing company with minimal time and costs.

Malta provides a large number of organizational and legal forms for the registration of a company, here are some of them:

• International trading company in Malta;
• Partnership;
• Private limited company;
• Shipping company;
• Trust.

This is not the whole list of organizational and legal forms for registering a company in Malta, which will interest a foreign businessman. In addition it is worth to mention such forms as the tourism business, the IT field, outsourcing, the gaming segment (E-commerce, Forex, online casinos), crypto-exchange registration. Malta is also one of the major centers for registering of yachting, seagoing vessels, as well as aviation, etc.

Incorporation of a company in Malta

To incorporate the company in Malta, first of all, it is necessary to prove that the director and the beneficiary of the future company have a good reputation and are financially-prosperous. For this reason, there are a number of requirements for the documents needed for company registration.

In addition, to register a company in Malta, you must provide a complete business plan and undergo the procedure – know your customer.

To register a company in Malta, it is required to:

• To replenish a statutory fund – approximately 1165 €, the joint-stock company – € 46,600. These funds must be paid to the company’s constituent account. The same money can be used in turnover.
• Two shareholders (there are exceptions) and one director (if this is a public company – two).
• Hold annual meetings of shareholders and directors in Malta, plus annual audit reports.
• It is obligated to have a registered office in Malta.
• Tax system of Malta.

It may seem that Malta’s tax system is not very attractive, but in order to get the maximum benefit from it for registering a company in Malta, it’s better to turn to specialists:

• Corporate tax is about 35%, however, in fact, the tax burden may be around 5%, depending on the specifics of the company’s work.
• VAT – 18%. Depending on the specifics of the company activity, low VAT rates may apply, about 5-7%.
• Royalties, dividends, bank interest – are not taxed separately.
• Stamp duty: 2% – 5%.

The procedure and amount of tax refund in Malta

The amount of tax refund is set at 6/7 of the tax paid by the companyin Malta.

As it was mentioned above, the Malta company will be taxed at 35%, but shareholders will have the right to demand back 6/7 of this tax. In other words, an effective tax liability is 5% [6/7 * 35 = 5].

For example, if the profit is 100,000 euros, the company will pay 35,000 euros in taxes, but the shareholder has the right to demand 30,000 euros back as a tax refund.

It should be noticed that the Maltese regulators are interested in developing international business on their territory. As a result, a state program was established in support of entrepreneurship, which provides businessmen with benefits and credits.

Protection of Intellectual Property rights in Malta

For many years Malta proved itself as an ideal jurisdiction for the protection of intellectual property rights. The country offers many tax breaks on the income received from intellectual property.

In addition to exemption from taxes on income derived from patents, copyrights and trademarks, 

Malta also provides various forms of exemption from double taxation, as a result of the conclusion of more than 70 double taxation treaties.

The company in Malta is an excellent and convenient tool for tax planning.

Malta is not on the gray offshore lists and, in addition, it’s always nice to come to Malta to relax.

Optimizing taxes through the registration of a company in Malta is not an easy task. It can only be done by international lawyers. With the help of a team of SBSB professionals, you will not have to pay very high taxes.

For over five years we have been advising our clients in the field of corporate law, international tax planning, finance, international licensing and integrated business support in more than 40 countries.

We will be glad to help you.