Malta Corporate Services
Double taxation treaties
Choosing the right business set up
The Limited Liability Company (LLC) is the most common form of business entity on Malta. A company may have the status of a public or a private company. The memorandum and articles of a private company must:
- Restrict the right to transfer its shares;
- Limit the number of members to 50;
- Prohibit any invitation to
the public to subscribe for any shares or debentures of the company.
A Malta LLC can be used for international trade and the holding of investments and/or property. It requires a minimum of one shareholder, one director and a company secretary. There is also an annual accounting requirement.
The minimum authorised share capital for a private company in Malta is €1,165, of which 20% must be paid-up, while the minimum for a public company is €46,587, of which at least 25% must be paid-up.
Malta trading companies are onshore business companies that are registered under the Maltese Companies Act, which are taxable on a worldwide basis at the normal corporate tax rate of 35%. Shareholders are entitled to a 6/7ths refund, reducing their effective tax rate to around 5% at shareholder level. Malta’s corporate tax rate is chargeable on
a company’s profits after deducting all allowable business expenses. Maltese trading companies are able to conduct any business activity, whether in Malta or outside Malta, including buying and selling of commodities, agency and representation, consulting and advisory services, e-commerce and online gaming.
Malta holding companies can be set up in order to hold shares and securities and business assets in any form – real estate, fixed assets, aircraft, investments, bank accounts and intellectual property – as well as personal assets such as yachts, residential property and works of art. Although there is no defined holding company regime,
the domestic tax treatment afforded to the different types of income received by such companies, as well as the participation exemption regime, make the setting up of Malta holding companies a highly attractive option, especially as a conduit for the EU.