1. I would like to set up a company in Malta, what is the standard corporate tax rate?
The standard corporate tax rate in Malta is 35%, which is applied on the income of the company after allowing for any deductible expenses and non-taxable income.
For more information about taxation of companies in Malta, do not hesitate to contact Elaine Camilleri, the firm’s tax partner, on email@example.com.
2. Is there a possibility for this corporate tax rate to be reduced?
Yes, by means of the refundable tax credit system which Malta has to offer, whereby non-resident shareholders are allowed to claim a refund of 6/7ths (in certain circumstances 5/7ths or 2/3rds) of the tax paid by the company upon the distribution of a dividend. This reduces the effective tax rate to 5%.
For more information about the refundable tax credit system, kindly visit our factsheet on Taxation of Malta Companies by clicking here.
3. If I set up a company in Malta, is it automatically deemed to be tax resident in Malta?
Yes, a company is deemed to be resident in Malta for tax purposes if it is incorporated in Malta. Companies which are incorporated outside Malta but are effectively managed and controlled from Malta are also considered to be tax resident in Malta.
For more information about how a company’s management and control can be effectively exercised in Malta, do not hesitate to contact Elaine Camilleri, the firm’s tax partner, on firstname.lastname@example.org.
4. I have heard that Malta operates a Full Imputation System. What does it mean and how may I benefit from this if I set up a company in Malta?
Yes, it is a system whereby the shareholders of a Malta company will be entitled to a tax credit equivalent to the tax paid by the company, upon a distribution of profits. The highest rate of tax applicable to individual shareholders is 35% (equivalent to the corporate rate of tax), meaning that no further tax will be paid by the shareholders on distribution of profits by the company.
For more information on this system, do not hesitate to contact Elaine Camilleri, the firm’s tax partner, on email@example.com.
5. If my Maltese company receives foreign income that is subject to tax outside Malta, will it be entitled to claim relief for foreign tax?
Yes, Malta offers various forms of double taxation relief. The most common being the treaty relief which emanates from the extensive treaty network which Malta has with over 70 countries. The relief is given in the form of a credit whereas the foreign tax suffered is set-off against the Maltese tax liability.
For more information on the various forms of double taxation relief, kindly visit our factsheet on Taxation of Malta Companies by clicking here.
6. Is my Maltese company required to withhold any tax upon the payment of dividends to me as shareholder?
Under Maltese tax law, a Maltese company is not required to withhold any tax on the payment of dividends to you as the shareholder, irrespective of your residence, domicile and nationality.
For more information about the taxation of dividend income, do not hesitate to contact Elaine Camilleri, the firm’s tax partner, on firstname.lastname@example.org.
Maltese companies are subject to tax at the rate of 35% on their world wide income and capital gains. Malta grants various fiscal incentives to both companies and their shareholders upon distribution of a dividend. Malta is a membe...Learn More
Setting up a Company
Setting up a company in Malta is a relatively straight forward procedure and can be set up within 2 working days, provided we are in receipt of all the information, funds and due diligence documentation we need. The Act that regulates Malte...Learn More
Taking up Residence
Warm climate, friendly people, excellent communication infrastructures, low criminality and many other features of the Maltese islands have made Malta an excellent destination for people to take up residence in. Moreover low rates of taxati...Learn More
Malta was the first EU Member State to specifically regulate the remote gaming industry in 2004 and has ever since established itself as one of the prime jurisdictions for remote gaming operators. The Malta Gaming Authority (“MGA”) is the regulatory of gaming in Malta. The success o...Learn More
Malta has become a destination of choice for the setting up of Payment Institutions (also referred to as Payment Services Providers or PSPs). A number of advantages has contributed to this success, mainly but not limited to the fiscal incentives granted not only to the payment institutions ...Learn More
Electronic Money Institutions
Malta has recently seen an increase in the number of Electronic Money Institutions (EMIs) looking to set up their operations in Malta. This has been largely due to the growth in the e-commerce and the i-gaming industries. Such EMIs are regulated by the Financial Institutions Act and t...Learn More
Initial Coin Offering (ICO) Services
Malta has always been on the forefront of technology and innovation. In the past months, a number of initiatives have been launched, aimed at establishing an innovative and attractive regulatory framework for entities operating in blockchain (and distributed ledger technologies), virtual cu...Learn More
Prospects – Services of a Corporate Advisor
‘Prospects’ is a new platform set up by the Malta Stock Exchange in line with its commitment to open up new capital market opportunities, create economies of scale and to afford businesses more competitiveness and sustainability. Through ‘Prospects’, SME’s wil...Learn More
Assistance to Family Businesses
Malta has recently introduced legislation to encourage good governance in the management of family businesses, to assist family businesses to operate their business in an efficient way and to assist such family businesses to transfer their business from one generation to the other. Malta is...Learn More