The most commonly used type of company in Malta is the limited liability company. This type of company may be one of the following:
- Private limited company
- Public limited company
The main distinction between the two is that the public limited company may offer its shares to the public and there is no limitation on the number of members it has. While a private limited company limits its members to 50 and may not carry out any offering of its shares to the general public. There are also certain constraints on the transferring of shares in a private limited company.
Companies incorporated in Malta must present annual financial statements to the Malta Financial Services Authority (MFSA). Such statements must be signed by an auditor holding a practising certificate, who gives an independent opinion on the financial statements being presented. The form of the financial statements depends on the size of the company. Companies which qualify as being small undertakings may present abridged financial statements, whilst all other entities must present a full set. The results included in the financial statements must also be represented in the company annual tax return which is to be filed with the Inland Revenue Department (IRD) within specific dates.
Companies incorporated in Malta may also take the form of a Holding Company, which is a company that holds shares in other companies or holds any other assets including movable and immovable property, cash and intellectual property both in and outside of Malta
The benefits of registering a company in Malta:
- Tax benefits – Malta is the only EU state that applies the full imputation system. When shareholders receive dividends from the Malta company they will be entitled to claim a refund of the Malta tax paid by the company on those profits out of which the distributions have been made;
- Relatively simple and fast process – the incorporation of a new Malta company can take as little as 24 hours;
- Cost effective fee structure – from as little as €245 for registration fees and annual fees from €100;
Nominee Shareholders and Directors
Beneficial owners who wish to remain anonymous may use the services of individuals or companies such as ARQ who are licensed to act as nominees by the Malta Financial Services Authority (MFSA).
Directors’ duties are to act honestly and in the best interest of the company. Nominee directors will act on instructions provided by the beneficial owners of the company but must adhere and apply the rules of good conduct at all times.
Redomiciliation of Companies
The redomiciliation of companies in Malta is governed by the Continuation of Companies Regulations, 2002. These regulations allow companies incorporated in other jurisdictions to continue their operations here in Malta, without the need of having to wind up their operations abroad.
The Regulations are divided into two parts. The first part of the regulations lists the criteria necessary for companies who are incorporated in foreign jurisdictions to redomicile to Malta, while the second part of the regulations lists the criteria that must be adhered to for companies incorporated in Malta to continue their operations in other foreign jurisdictions without the need of having to wind up their operations locally.
Corporation tax in Malta is at a rate of 35% on the company’s profits. Shareholders of a Malta Company are entitled to claim a refund of the tax paid by the company whenever a dividend is being distributed.
Shareholders who receive dividends from companies incorporated in Malta may claim a number of refunds on the tax payable depending on the nature of the income received by the company. The refunds available are:
- 6/7ths refund on income derived from trading activates (resulting in a net tax leakage of 5%);
- 5/7ths refund on income derived from passive interest or royalties (resulting in a net tax leakage of 10%);
- 2/3rds refund if the company has claimed double tax relief;
- Full refund in the case of profits derived from a participating holding
Malta Shelf Company
The concept of a Malta Shelf Company is one whereby an aged Malta Company which is no longer carrying out any trading activities, may be purchased by someone who would prefer to have an aged Malta Company rather than going through the process of incorporating a new one. The main benefit of purchasing a shelf company tends to be the speed of incorporation, however, since the incorporation of a new Malta Company can take as little as 24 hours we do recommend to incorporate a new company rather than purchasing an aged one, unless there are particular investment or financial reasons of purchasing a Malta company that has already been incorporated.
We are able to advise you on the best solution depending on your particular needs as we do have a list of clients who would like to pass on their Malta Company.
Malta Fund Company
Investment funds and collective investment schemes have continued to grow in Malta, this shows the ongoing confidence in Malta as an attractive fund domicile. Malta has also catered to the needs of foreign investors by developing a dynamic fund administration and management sector.
Benefits of a Malta Fund Company:
- Growth prospects: The regulator in this sector is the Malta Financial Services Authority which is confident that business will continue to grow in this sector.
- Efficient licensing process: The Malta Financial Services Authority offers a quick and efficient operating process and the licensing process usually take between 5 to 6 weeks from application.
- Lower Costs: The cost of professional and high quality staff and office space is still well below similar costs in other EU countries.
- Protection of Investors: Investor protection is key to maintain the reputable name that Malta currently has with international investor and is often one of the key motivators behind their decision to move to Malta.
- Professional service: Malta is known for its highly qualified, multi lingual professionals in the financial sector that give an efficient service to clients worldwide
Malta Gaming Company
A Malta Gaming Company can be incorporated to either operate using a Malta Remote Gaming License or to operate using a Non-Malta Remote Gaming License
1. Malta Remote Gaming License:
Malta has become the number one jurisdiction for online betting and gaming world-wide. Malta offers exciting opportunities for market players and entrants together with a well-regulated and beneficial tax environment.
The Main Advantages here include:
- Any type of game you want to offer can be licensed;
- Targeting the European Gaming Market using a Malta Company and a Malta Remote Gaming License is still proving to be the most cost effective entry strategy;
- License costs are the lowest within Europe at € 2,300 for the Application and € 7,000 for the Annual License;
- Gaming Taxes are the lowest within Europe these varying depending on the license held;
- Company Tax Regime in Malta is the lowest within Europe netting off at a 5% rate minimum.
2. Malta Gaming Company operating under a non-Malta Remote Gaming License:
Gaming operations licensed abroad choose to use a Malta company for a number of reasons, including:
- For winnings to be tax free in the hands of the players certain jurisdictions require that payment is done by an EU company. A Malta Company is generally used for this purpose.
- The Company Tax Regime of Malta is very advantageous netting off at a 5% rate minimum.
- Payment Processing can be segregated within a Malta Company to benefit from advantageous banking rates in Malta and to get Company tax benefits on the profits generated within the same Malta Company.
How We Do It
ARQ’s corporate team are able to guide you on all the necessary steps that you will need to take in order to incorporate your company in Malta. The process is quite straight forward, however, it may be time consuming if the necessary documentation is not presented to the Malta Financial Services Authority (MFSA) in the correct manner. We are here to ensure a smooth incorporation process.
The first step in incorporating a company in Malta is to obtain the necessary due diligence on the directors and shareholders of the company. Once we complete all the necessary due diligence documentation, we draft the Company’s Memorandum and Articles of Association. Once the Memorandum and Articles of Association of the company are signed by the shareholders and the issued share capital deposited into a company in-formation account at one of the local banks, we will send the necessary documents to the MFSA so that the company will be incorporated.
Once the Malta Company is incorporated and the Company number is issued we will apply for an Income Tax Number, which will be the company reference number for tax purposes. Depending on the nature of the company’s activities we will then proceed with applying for Value Added Tax (VAT) number and PE number for companies engaged in employment activities.
Other related services from ARQ Group include:
- Opening a bank account in Malta;
- Provision of Directorship services;
- Tax advisory;
- Accounting & payroll services;
- Auditing services through our partner audit firm, Capstone Group;
- Legal advisory services through our partner legal firm, FFF-legal that may include:
- Mergers & Acquisitions
- Real Estate
- Regulatory Compliance
- Corporate & Commercial services
- Setting up of Trusts in Malta;
- Malta & other EU jurisdiction Residence and Citizenship schemes;
- Malta yacht, Ship and Aircraft registration;
- Resource outsourcing – marketing services, website development, property & staffing solutions
The economy of Malta continues to grow from strength to strength and the ARQ Group continues to expand and adapt to the needs of our clients. The work that we do is versatile, complex and truly international in terms of both our reputation and our reach.
Please make contact with us below and we will gladly assist you with the best advice and solutions for your needs