Malta Company Formation
Thinking of setting up a Company in Malta?
For more information about Malta company formation, kindly view our Company in Malta and Trading Company in Malta, Malta Holding Company and Redomiciliation to a Company in Malta and a Company in Malta Facts. Also you can refer to our Company in Malta Benefits section for a summary of the benefits of setting up a Malta Company, Shelf Company in Malta to buy an old company in Malta or Malta Companies.
Company registration in Malta is regulated by the Malta Financial Services Authority (MFSA). Company formation can take as little as 48 hours. Malta is a tax efficient jurisdiction for holding and trading companies. Company formation expenses in Malta are relatively low, thus making Malta a cost effective jurisdiction, not only or large corporation’s tax planning, but also for small and medium sized businesses.
We will help you in all aspects of your Malta company formation process, as our services do not stop at registering the company in Malta on your behalf. We also provide the following services:
- Nominee Shareholders
- Maltese Company Directors
- Maltese Company Secretary
- Audit (through our affiliates)
- Registered Office
- VAT Registration
- Bank account
Malta Company Information
Summary of benefits of registering a Company in Malta:
- 6/7 refund to the non resident shareholder of a Malta company (Trading).
- Full tax refund of a Malta company holding a participating interest in another non resident Company.
- No withholding taxes, stamp duties or exchange control restrictions apply on distribution of profits from the Maltese Company to non resident shareholders.
- Low Company Formation costs.
Tax on a Company in Malta(Detailed)
The payment of a dividend from a Maltese company to a non resident shareholder(of the company in Malta) triggers the right to a refund of part or all of the tax paid by the Maltese Company on the profits. The tax paid by the Maltese company is refunded to the shareholder in one of the following forms depending on the source of the profits.
- Refund on 6/7th of the tax paid by the Malta company (except on profits on sale of immovable property in Malta, and profits that have been taxed at source on a final withholding regime)
- Refund of 5/7th of the tax paid by the Malta company on profits that consist of passive interest or royalties
- Refund of 2/3rd of tax paid by the Maltese company on profits that have already claimed relief for double taxation
- Full refund on profits that are generated from a ‘participating holding’
Effective Tax Payable for a Trading Company in Malta
The effective rate of tax payable for a trading Company in Malta is therefore 5% due to the 6/7ths refund available to non-resident shareholders of the company registered in Malta.
Participating Holding rule for a Holding Company in Malta
A holding by a Maltese Company in a non resident company qualifies as a participating holding if any of the following is satisfied;
- The holding is 10% or more of equity share capital
- The Company in Malta has an investment of minimum €1.16million held for at least 183 Days
- The Company in Malta is entitled to appoint a director in the non-resident company
- Where the holding is a furtherance of the business of the company in Malta. The Profits by the Maltese Company from a ‘Participating holding’ is exempt from tax if one of the following is satisfied:
- The non-resident Company is resident in an European Union State; or
- It is subject to foreign tax of 15% or more; or
- It does not have 50% or more of its income derived from passive interest and royalties
If none of the above conditions is satisfied, the both the below conditions need to be satisfied for the participation exemption to apply:
- The holding of the Maltese company is not a portfolio investment. If the non resident company derived more that 50% if its income from portfolio investments this will be deemed as a portfolio investment.
- The non resident company has paid foreign tax of more than 5%.
No withholding taxes, stamp duties or exchange control restrictions apply on distribution of profits from the Maltese Company to non resident shareholders, and these dividends can be expatriated without any restrictions. Tax payments and refunds Tax is payable on profits arising from overseas income within 18 months from the end of the Financial year those profits pertain to. If dividends are paid out, then the Tax is payable within 60 days from the end of the month in which these dividends are paid. Implications on foreign business activities. By setting up a company in Malta, this would not affect business as usual of current trading activities. The only amendments required are:
- Change of Trading name (If a different company name is chosen) to that of the Maltese Company.
- Change of head office address to the Maltese registered office on all Company correspondence.
- Setting up of a Business bank account in Malta.
The content on this website is for information purposes only and should not be taken as tax, legal or any other professional advice.
Contact us for more information as well as for a quote. We will happily guide you through the company formation process and also advise you on the solutions that would best suite your needs!
[email protected] Or call +356 21 2010 3020