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.
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.