Understand the solution of Commercial Law and Tax Refund related issues

 

Malta is ranked well for the amount of taxes and social contributions paid by enterprises in comparison to other European nations. Multinational corporations are increasingly drawn to Malta as an investment destination because of its enhanced tax framework, particularly with regard to dealing with companies. The accession of the nation to the European Union was the catalyst for this evolution. Malta has also engaged in around 70 double tax agreements with other nations in an effort to further reduce taxation. Furthermore, there is some flexibility in the company tax code as well as in Commercial Law Malta, which in its final version is set at 5%.

The business tax rates in Malta are as follows:

In Malta, corporations pay 35 percent of their chargeable income in taxes. However, a tiny fraction of businesses fit into particular categories that have lower tax rates. International trading enterprises and multinational holding companies are examples of these kinds of businesses. International branches and subsidiaries of domestic enterprises do not pay taxes on income repatriated to their parent companies, even though domestic companies pay 35% in corporate taxes.

Who is eligible for the 5% discount?

Malta's 5% corporate tax rate is an alluring option for businesses trying to maximize their present tax liabilities. However, it is a fact that not every business is eligible for this rate right away. There are a few requirements you must fulfill in order to qualify for the 5% rate.

First and foremost, you need to ensure that your company is properly organized. You can ask for help from EMD Advocates for the very same. The formation of a holding company and a trading company is the following stage as a result. You may get payments from your customers and manage their funds if you adhere to these guidelines.

Malta offers company tax incentives

Companies headquartered in Malta may be eligible for a refund of six to seven percent of the corporate tax. If the corporation has a 35% tax rate, the shareholders may be able to claim 6/7 of the taxes. This would suggest that there is a 5% effective tax rate. There are some exceptions to this rule, thus it's not unbreakable.

If Maltese holding corporations make money by owning a business that is formed outside of Malta, they are eligible to receive their entire corporate tax paid returned under the participation exemption. Nonetheless, Maltese holding companies may choose to pay corporate tax on certain sources of revenue. After dividends are distributed, shareholders are entitled to Malta Company Tax Refund they paid.

Speak with an authority

Without a doubt, companies looking to lower their tax obligations will find Malta's 5% corporation tax rate to be an alluring alternative. Malta's government has established a favorable tax environment, making the nation a top option for businesses wishing to locate in Europe.

The EMD Advocates offer its Malta-based customers a comprehensive range of company tax services. These services include planning for interim and final dividends, assisting with the preparation of dividend warrants for tax refund purposes, advising on corporate tax planning and structuring prior to incorporation, assisting with actual refund applications under Malta's advantageous corporate tax system, and advising on cash flow planning within the context of corporate tax compliance. These services are provided to Maltese citizens. Give a Tax Malta Company sound advice on how to comply with its VAT requirements; this will assist guarantee that the company continues to pay its Maltese and foreign VAT obligations in full.

Establishing a Foundation in Malta: Step-by-Step Guide and Legal Framework

 

Malta allows you to set up foundations instead of trusts. Foundations have the benefit of being both a legal entity and a well-understood and recognized idea in nations with a Roman legal system. EMD Advocates offers comprehensive Legal and Compliance Malta assistance, ensuring seamless foundation establishment. They specialize in navigating the legal intricacies, ensuring compliance with local regulations for a robust foundation.

Advantages of establishing a foundation in Malta

Here are the top advantages of registering a foundation in Malta:

Asset Management and Distribution Flexibility

Foundations can be used for a variety of purposes, including financial structuring and planning, as well as estate planning. In a word, a foundation allows a person more control over their assets and how they are allocated.

Administrative Management

A foundation can choose an administrator to handle its finances and distribute them to its beneficiaries. Although a purpose foundation must designate at least three administrators—or at least one legal person serving as administrator—as long as the business has at least three directors, every private foundation is required to have at least one administrator. The founder might be both an administrator and a beneficiary.

Legal autonomy and fiduciary responsibility

It is vital to emphasize that a foundation's assets and liabilities are independent of those of its founders, managers, and beneficiaries. In reality, administrators have fiduciary responsibilities.

How to Establish a Foundation in Malta?

Foundations are established by one or more founders through a written document, including a will, in accordance with the stipulations of the Malta Trusts and Trustees Act, in which given assets of a value equal to or greater than € 1,164.69 are trusted to the administration of one or more administrators for a specific legal purpose, such as charity or philanthropy (Public Foundations) or for the benefit of a person or a class of persons (Private Foundations).

Tax Framework

Malta introduced foundation-specific laws for the Taxation of Foundations in 2010. In general, foundations can choose to be taxed as a corporation (by default) or as a trust (by irrevocable choice).

Foundations taxed as corporations are handled the same as firms with resident and domicile in Malta, and are subject to 35% tax, the complete imputation system, and the tax refund regime. Profit distribution to beneficiaries equals dividend payout to company shareholders.

Because they may apply the participation exemption to dividends and capital gains from participating interests, foundations are frequently employed as holding corporations.

If the foundation is treated as a Trust and meets specific standards, it might be deemed transparent for tax reasons, which means that there are no taxes in Malta in circumstances when the founders, beneficiaries, and assets are not residents of Malta.

According to the provisions set forth in the Malta Trusts and Trustees Act, Maltese law permits the conversion of a Foundation into a Trust and vice versa.

Conclusion

In conclusion, the Legal and Compliance Malta framework for foundations offers a powerful amalgamation of asset management control, administrative flexibility, legal autonomy, and tax advantages. Establishing a foundation in Malta empowers individuals with unparalleled control over asset distribution and allocation, providing avenues for diverse financial structuring and estate planning. The tax flexibility, offering options to be taxed as corporations or trusts, coupled with the ability to convert between foundations and trusts, solidifies Malta's position as an attractive destination for those seeking to optimize wealth management strategies while ensuring legal compliance and asset protection.

Malta Company

 

Malta Company Formation & Incorporation

The process of company formation and incorporation in Malta is set out by The Malta Companies Act which is modelled on its UK counterpart. Maltese business owners can therefore enjoy a simple, straightforward Malta company incorporation procedure. When a Malta business is formed, the company may be registered within a day of receiving all required Maltese company documentation, information and funds from the Registry of Companies in Malta.

There are numerous financial and operational benefits associated with registering a business in Malta. If you’re a Maltese business director, or are considering the formation of a Malta registered company, read on to find out just what to expect from your swift and smooth business incorporation process:

Requirements & Restrictions of company formation and incorporation in Malta

Malta company law does not impose any restrictions on the nationality and residence of the shareholders and directors of a Maltese business, or that of the company secretary. Furthermore, provided the business operation in question is legal, there are no restrictions on the types of activities that a company in Malta can carry out following its successful registration and incorporation. However, the activities of certain Maltese businesses may be regulated by local authorities such as the Malta Financial Services Authority (MFSA) or the Malta Lotteries and Gaming Authority (LGA).

The Maltese Companies Act states that the minimum share capital of a company registered in Malta is €1165. At least 20% of this must be paid upon subscription, and deposited in a bank account under the name of the Malta registered business.

Directors

When forming a Maltese registered business, bear the following conditions in mind:

A Malta company is required to have at least one director, who may also act as the company secretary in certain cases.

It is possible for a body corporate to act as the director of a Malta business, although the role of company secretary must be filled by an individual.

Maltese business laws also state that an individual can be both a company director and shareholder.

Shareholders

For successful Malta company formation and incorporation, Maltese law generally requires that a business has at least two shareholders; however, it is possible to successfully register a Maltese company with only one shareholder provided the company fulfils certain conditions. Shareholders in Maltese businesses can be either individuals or corporate bodies, and it is possible for the shares in a Malta company to be held by an authorised fiduciary, thereby keeping the identity of the beneficial owners fully confidential. A Maltese company is also required to hold a members’ Annual General Meeting (AGM) at least once every year.

Auditing

A registered Malta company is required by law to submit an annual return to the Registrar of Companies, and to have all annual financial statements audited.

Company Tax

Malta also offers a very attractive tax system that can be highly beneficial to companies registered in the country. to download our comprehensive fact sheet on For a Malta company formation process that is quick and straightforward, turn to EMD’s group of Maltese business experts. EMD’s Malta business experts can advise and assist you with your Malta company incorporation procedure, so you can be sure of meeting the legal requirements for successfully establishing a Maltese company and becoming a Malta business owner.

Aircraft Registration Malta

 

The Malta Aircraft Registration Act 2010

The Malta Air Operators Certificate (Malta AOC) and Aircraft Registration Malta Act 2010 consolidates the previously existing laws on aircraft registration. Through the establishment of an ambitious aircraft register and the setting up of the Malta Transportation (Regulatory) Authority, Malta is now also well positioned into one of the EU’s most topical business opportunities.

The Malta Aircraft Registration Act provides for the innovative concept of the registration of aircraft under construction. Such can be registered so long as such aircraft is uniquely identifiable. The Malta Aircraft Registration Act endeavors to limit nationality and form requirements in order to make the register accessible to as many owners and operators as possible, while ensuring that the register is not open to anyone and everyone.

To this effect the Malta Aircraft Registration Act prescribes those persons who are qualified to register an Aircraft whether used for the provision of air services or otherwise. These include:

• Citizens of Malta who have approved residence in Malta and citizens of Member States of the European Union, EEA State or Switzerland. Such individuals must have a place of residence or business in Malta, the European Union (EU), the European Economic Area (EEA) or Switzerland;

• An undertaking formed and existing in accordance with the laws in Malta, a Member State of the European Union, the EEA or Switzerland. In terms of the Malta Aircraft Registration Act, the undertaking must have its registered office, central administration and principal place of business within Malta, the EU, the EEA or Switzerland, whereof not less than 50% of the undertaking is owned and effectively controlled by the Government of Malta or by the Government of any other State of the EU, or by the persons abovementioned in paragraph (a), this requirement ought to be present indirectly or directly through one or more intermediate undertakings.

In accordance with the Malta Aircraft Registration Act, a natural person who does not qualify under paragraphs (a) and (b) above, but is a citizen of or an undertaking established in an approved jurisdiction shall be qualified to register aircraft in construction or one which is not used to provide an air service. This delineates the legislator’s intent to widen the scope of the Malta Aircraft Registration Act and consequently expand the range of those who could register under this law. This extends the possibilities for those owners of aircraft who will be using their aircraft for private use and not for hire or reward as prescribed by the pertinent legislation.

Malta VAT Treatment on Aircraft Leasing

The Maltese VAT Department has also recently launched a new aircraft leasing procedure, making Malta an attractive jurisdiction for aircraft registration for both private and commercial aircraft while ensuring full adherence to EU laws and regulations. The net result from this VAT simplification procedure is that the Malta VAT rate of 18% is only payable on that portion of the lease payment which is deemed to be for the use of the aircraft within EU airspace. The minimum percentage of time that an aircraft could be deemed to be in EU airspace, depending on maximum take off mass, maximum fuel capacity, fuel burn, optimum altitude and cruising speed) is of 30%, thereby resulting in a minimum effective VAT rate of 5.4%. For further information please click here.

The Use of Trusts and Fractional Ownership

The Malta Aircraft Registration Act ensures that when there is a trust relation and the Director General is to “look through” to the identity of the underlying beneficiaries, procedures will be implemented to safeguard the confidentiality of the trust arrangement in line with the principles governing trust law. In this manner, an obligation is imposed on the Director General to ensure that the disclosure for the purpose of Malta aircraft registration does not negatively affect the operation of the trust and its inherent confidential nature.

The new Malta Aircraft Registration Act acknowledges the benefits that will result from the employment of trusts in this field, and specific mention is made of fractional ownership and trusts which could be employed when the ownership/use interests of a plurality of persons (legal or natural) is to be regulated in relation to an asset, the aircraft, by interposing a trust relation. Thus, provision for regulation and co-ordination of the beneficiaries’ rights and interests will be made in the trust deed, which can provide for innumerable arrangements, in line with the contingencies of the case at hand.

The Maltese Aircraft Registration Act ensures that the existence of the trustee, being the registered owner of the aircraft, in favour of the determined beneficiaries (in a fixed trust scenario) or for the benefit of determinable beneficiaries (in a discretionary trust scenario) allows the arrangement to operate in a more streamlined manner whilst permitting the rights of the beneficiaries to be enforced against the trustee in case of default, thus protecting the beneficiaries who would be the stakeholders in this arrangement.

Sale Malta Company

 

Business Incorporation in Malta

Business incorporation is accomplished through various stages and there are multiple steps involved in the entire process. To start a new business in a foreign country is much for time-consuming than the relocation of an existing one. Malta is one of the ideal countries to set up a business owing to its favourable economic and tax structure. From a company's inception, the government of Malta provides all kinds of support to every other foreign investor right from finalizing an appropriate location to corporate structure. Malta encourages businesses of all kinds and of all levels hence more and more investors are keen on investing in the small yet powerful island nation.

Maltese Business Incorporation

EMD provides all kinds of support for the successful inception of a business in Malta. It boasts as one of the associates for Top Tier Law Firm that guides a business entity in all related matters. Before proceeding to company formation, one must be well aware of the Employment Law Malta, which is very favourable but at the same time has certain guidelines and regulations. The Employment and Industrial Relations Act or EIRA provides the legal framework for employment law as well as wage distribution in Malta. The employment law aims to protect all employees that are part of Malta. If you wish to get a new company registered in Malta, the process is quite easy and less time-consuming. The process is completed once a certificate of incorporation is issued by the registrar which maximum will take a week’s time condition all the documents provided are proper. You will be required to submit a Memorandum of Association stating details like company name, capital investment, investors, company directors, company secretary, and location among other details. The details may vary as per the type of company or business. Depending on the authorized share capital, a processing fee must be submitted to the registrar.

Choosing Malta for Business

Malta is one of the youngest yet most promising small island countries in the European Union. Be it for successful business incorporation or to Sale Malta Company, you will find numerous favourable opportunities in the country. The country provides growth opportunities as well as wealth benefits for all foreign investors. Another notable advantage of having a business in Malta is its favourable tax system. It has the lowest net tax rates. The Maltese taxation refund system offers shareholders the are able to claim a portion of their tax paid after paying the dividends. Another few advantages are:

• Low incorporation costs
• For those involved in international activities, an exemption from duty on documents is possible
• Malta offers double taxation treaties which ensures that you are not taxed twice for the same income
• The location of the island country in the middle of the Mediterranean Sea is quite favourable as it is easily accessible
• The cultural and linguistic diversity of the place is quite unique as there are people from across the globe settled here
• Malta falls under the no visa zone

All of these and much more are offered by Malta to all the investors willing to be a part of this country.

Malta Trust Foundation

 

EMD Business Support Services

It is difficult to get established in a foreign land, but with proper assistance from a genuine firm, you can easily crack the deal. Malta is a small island nation, which is quite favourable and promising for foreign investors. This owing to its lenient and promising tax system that favours investors. Malta is small but still has time again to prove its worth as a potential country when it comes to new business ventures. A new business needs support right from its inception throughout its deployment, and for that EMD provides necessary support services.

Why Malta for Business Relocation?

Malta is one of the most favoured destinations for new business. A large number of foreign investors are keen on establishing or relocating their business to Malta for many reasons and some of the top reasons for Malta Corporation are listed below:

•   Favourable corporate tax system by Maltese jurisdiction
• The workforce and labour in Malta are highly motivated and competitive
• Low labour cost
• The Maltese jurisdiction follows a refundable tax credit scheme as well as double taxation agreements
• Even after being a small island nation, Malta has high standards of infrastructure including commercial, residential, IT, business, and human resources infrastructure
• Malta has a strong and stable economy making it quite favourable for foreign investors

Professional Investor Fund in Malta

In Malta, there are various citizenship and business-related schemes available which again encourages an investor to set up a business here. One of the most popular and widely known schemes is that of the Malta Professional Investor Fund. Also known as PIFs, these are a set of investment-related schemes which come under the Investment Services Act, of 1994. They have fewer regulations in comparison to retail investment schemes and have a minimum investment threshold that is mandatory to achieve. The main benefit or advantage of this investment scheme is that PIFs are exempted from risk spreading and hence are not bothered by any sort of leverage restrictions. The PIF funds can be either managed by an external fund manager or via a self-managed fund. EMD offers all kinds of support services to get complete details and documentation done for PIFs in Malta.

Foundations in Malta

Foundations are not rare in Malta and Malta Trust Foundation has been functional in the country for a very long time from now. Often, trusts and foundations have similar qualities while the mode of operation is what makes them different. There are a set of rules and regulations that must be followed strictly to operate a trust or foundation under Maltese jurisdiction. These usually come under the category of a non-profitable organization serving a social purpose. EMD team provides all details related to the procedure for registering a trust or foundation with ease. You just need to provide the relevant and sufficient papers for registration of the institution.

EMD is out an out-business service provider that offers an array of services including the likes of EMD advocates, EMD advisory, and Malta residence and citizenship. These are offered to a range of business domains including iGaming, finance, IT, and health among others. Hence for the establishment of any kind of business, EMD is the most preferred destination.

Malta for Business and Personal Growth

Malta is a small yet powerful island nation that is an inevitable part of the European Union. Owing to it favourable conditions in broader aspects, Malta today has been one of the favourites and most preferred destinations for different kinds of foreign businesses. The law and taxation system here is favourable and hence this attracts several foreign investors to set up business ventures. EMD as a company provides related business infrastructure and other services to diverse clients from across the globe with head office in Malta.

 

Why choose Malta?

 

Malta has been a part of European Union since 2004 and a part of Eurozone since 2008. Apart from this there are many advantages to the country that makes it preferrable for foreign investors as discussed below:

• Corporate and Commercial Law – The laws governing the inception of new business are quite relaxed unlike other nations. This does not incur that you can get away with fraudulent activities, which are strictly prohibited here
• Appropriate location – Malta is located right between eastern and western Mediterranean and North Africa which makes it a culturally diverse country
• Political stability that favours foreign investors and new business inceptions
• The country vouches by a robust economic growth as per the drawn statistics
• There are immense opportunities for growth here, be it any sector including education and healthcare
• Malta even though is a small island nation, but it has a good connectivity with the global world
• The taxation system of the country favours foreign investors, which is one of the main reasons to go for business in Malta

There are few low points as well, but when compare to plus, these can be ignored. The lows include lack of road infrastructure, small domestic market size among others.

What EMD has to offer?

 

To successfully set up Malta company, one needs to get assistance from a reliable trustworthy source and what better option than EMD. The services provided here are broadly categorised into EMD advocates, EMD advisory and Malta residence and citizenship. While the first two services are somewhat related to business, the third category is based on individual participation in the country. If you want to be a part of an economy like Malta, then the first step would be to get a Malta residency visa. There are various ways by this citizenship can be acquired direct investment, ordinary residence, long term residence, temporary residence, the Nomad Malta residence permit and many more. EMD advocates as the name suggests is a law firm with several lawyers in Maltese, while EMD advisory is an out and out consultancy firm that offers services to both local and global applicants. EMD offers a multitude of services in the lines of legal, tax, advisory, and corporate services. They are updated with all latest government rules and regulation that will be applicable, both for business as well as an individual. The team is highly efficient and dedicated in delivering timely quality service.

 

Choosing Malta for your business can be a good choice but without proper guidance and support system, the incorporation can be a tedious task.