Company Incorporation in Malta
As an EU Member State, Malta is recognised internationally as a safe and secure place, with high economical and political stability. Malta is an attractive cost and tax-efficient base for financial services’ operators looking for an EU-compliant but yet flexible domicile.
Read more: A Guide To Malta Corporate Tax
Maltese company law which is governed by the Companies Act is mainly based on the English Company Law and is in line with EU directives. Shipping companies are governed by the Merchant Shipping Act. The Companies Act defines the types of corporate entities or commercial partnerships which may be established.
The Maltese Business Registry houses all registered commercial partnerships including companies irrespective of what type of activities they carry out. The Malta Business Registry is a public registry where all registered information and documentation is available to the public.
Types of Companies
Limited Liability Companies
Limited liability companies can either be Private (Limited) or Public (Plc) with the minimum number of shareholders or subscribers being two for both types. Private limited liability companies can be formed as single-member as long as the sole director is not a corporate entities and the object clause is restricted to one main activity.
Private companies must have a minimum authorised share capital of €1,165 (or equivalent – recommended €1,200) and may have different types and classes of shares. The directors of private companies do not need to be Maltese nationals and may be a corporate body with their details being public information. Bearer shares are not permitted and private companies must have a company secretary, who must be an individual and is not required to be resident in Malta.
Every company registered in Malta must have a registered office in Malta. This may be at the office of a firm of lawyers, accountants or other providers of corporate services. Any changes to the company’s registered office must be notified to the Malta Business Registry.
Companies registered in Malta must submit an annual return upon each anniversary of the company’s registration date and an annual fee is payable to the Malta Business Registry together with the annual return based on the amount of authorised share capital of the company.
After each financial year-end, the company must prepare audited financial statements in accordance with the Companies Act 1995, and these must be laid before, and approved, at the general meeting of the company and submitted to the Malta Business Registry. A company may opt to have its year-end other than 31st December as long as the first period is not less than six months and not more than eighteen months. The time allowed by the Malta Business Registry for the accounts to be submitted is ten months after the financial year-end for private companies and seven months from the financial year end for public companies.
Registration and Fee Structure
The Memorandum and Articles of Association, constituting the company are forwarded to the Malta Business Registry for registration. These should be accompanied by all relevant documentation, including:
Certified copies of identification documents of the shareholders and directors; references; and
Declarations by trustees, where applicable.
Evidence of paid up share capital should also be produced.
Upon incorporation, a registration fee is payable to the Malta Business Registry and varies according to the amount of authorised share capital.
|Authorised Share Capital||Fee Payable|
|Up to €1,500||€245|
|Over €1,500, but not exceeding €5,000||€245 with the addition of €15 for each €500 or part thereof in excess of €1,500|
|Over €5,000, but not exceeding €10,000||€350 with the addition of €20 for each €1,000 or part thereof in excess of €5,000|
|Over €10,000, but not exceeding €50,000||€450 with the addition of €20 for each €2,500 or part thereof in excess of €10,000|
|Over €50,000, but not exceeding €100,000||€770 with the addition of €15 for each €10,000 or part thereof in excess of €50,000|
|Over €100,000, but not exceeding €250,000||€870 with the addition of €10 for each €15,000 or part thereof in excess of €100,000|
|Over €250,000, but not exceeding €500,000||€970 with the addition of €10 for each €10,000 or part thereof in excess of €250,000|
|Over €500,000, but not exceeding €1,000,000||€1,220 with the addition of €20 for each €20,000 or part thereof in excess of €500,000|
|Over €1,000,000, but not exceeding €2,500,000||€1,720 with the addition of €10 for each €50,000 or part thereof in excess of €1,000,000|
Usually the formation process can be finalised within 24-48 hours from receipt of the documentation and satisfaction of requirements established by Maltese law. A company comes into existence from the date of registration indicated on its Certificate of Registration.
Benefits of setting up a company in Malta
Malta has a modern legal and tax framework, including a comprehensive double taxation treaty network and has to date concluded more than 70 double taxation agreements for the avoidance of double taxation. Malta’s treaties are largely based on the OECD Model Convention and grants relief from double taxation using the credit method.
Moreover, holding companies registered in Malta that are in receipt of dividend income or capital gains from a ‘participating holding’ or from income arising from the disposal of that same holding, may apply for a participating exemption and consequently, the dividend income will not be subject to income tax in Malta. No tax is withheld upon the distribution of interest and royalties to non-resident beneficial owners of such income irrespective of the residence and nationality of the shareholders.
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