Form a limited and company in Malta legally secure step by step!
The formation of a limited or company in Malta is highly attractive. As a small island, Malta offers plenty of sunshine and an impressive, business-friendly environment. Lightning-fast incorporation and especially Malta’s Holding Limited model stand for low taxes. Perfectly structured, you legally convert the 35 per cent corporation tax into 5 per cent. For the lowest taxes in the EU, you don’t need an account in the Seychelles, Bahamas or Cayman Islands.
Establish a limited and company in Malta – short answer for quick readers
| Quick Company formation: | Online formation in 1 day Possible through Trustees |
| Starting Capital: | From € 0 for self-employed, € 1,164.69 for Ltd., € 46,587.47 for Plc. |
| Tax Advantages: | 10% for non-EU digital nomads 5% for Ltd. Charge reverse Tax credit for investments |
| Business-Friendly | Minimal bureaucracy, digitized administration Blockchain + gigabit internet stable legal system |
| Further | English as official language EUR as a means of payment European Union freedom of establishment Schengen area |
Lucrative tax laws for digital nomads with zero per cent or optionally 10 per cent tax. Reside in Malta, operate a business in Malta, set up a holding company and pay 5 per cent tax, register a business or set up a company, digitally in a few days. Taxpayers from countries with a global income tax, such as US citizens, must disclose their entire income to their government.
Typical reasons for relocating or setting up a new company in Malta are
- High tax burden
- Bureaucratic requirements and lengthy authorisation procedures
- Frequent regulatory changes and therefore uncertainties
- Shortage and costs of skilled labour
- Unsuitable digital infrastructure
Facts about setting up a company or relocating to Malta
Cinema-goers, Hollywood and blockbuster fans know the dreamy places in Malta from
- The boat
- The Da Vinci Code
- Game of Thrones
- Gladiator
- The Count of Monte Cristo
- Troja
- …
In the mainstream, Malta is seen as a country of tax avoidance, despite a corporate tax rate of 35 per cent. The fact is, Malta offers its companies stable legal and planning security.
With a corporate tax rate of 35%, how do capital companies in the EU have nominal tax rates between 9% and 31.5%? This places Malta at the end of EU countries! Where is the tax avoidance, and how do companies and founders save tax in Malta?
Low entry barriers and a business-friendly company law make Malta an interesting place to set up and relocate a company from abroad:
- Tax rate of 35, 25, 15 and legally 5 per cent depending on the type of company
- Low incorporation costs for Ltd, Plc, partner companies and sole proprietorships
- The monthly (4-week) minimum wage has been EUR 887.12 since 2025 (EUR 221.78 per week)
- Low pay-as-you-go social security contributions.
- Second or part-time job exempt from social security contributions (no limit on maximum working hours)
- No fixed minimum length of stay in the form of a daily limit for tax purposes
- Company headquarters on request Home office possible
- With non-dom status, foreign income remains tax-free (residents without domicile)
- No obligation to have a bank account in Malta
- Low costs for authorisation of a company or legal entity
- Setting up a company online without travelling
- Malta signed the United Nations Standard of Excellence for Start-ups in 2021
- Malta is not on the EU and FATF country lists
You can establish a company in Malta within a few days. Some legal forms require mandatory customer due diligence. Common company forms in Malta are
- Self-employed (sole proprietorship, as well as digital nomads)
- Small Business
- Limited
By choosing the perfect corporate structure, you can reduce the tax to 5 per cent after reimbursement of the corporation tax (refund). Please check beforehand: Is relocation within the EU or EEA under applicable conversion tax laws or exit taxation possible without tax neutrality?
Business goes global, taxes stay local
How to establish a (subsidiary) company in Malta!
- Search for the perfect location
- Establish activities or a representative office
- Coordinate your company’s objectives with its legal form
- Reserve company name
- If required, pay in minimum share capital
- Commercial register entry
- If required, application for a trading licence
- Tax Identification Number (TIN) for companies
- If necessary, apply for VAT (value added tax)
- Register employer identification number for employees (Jobsplus)
- Employment and Training Corporation (ETC).
Special case: Start an online casino
Malta offers these two main licences for online casinos
- Gaming Service Licence (B2C) for direct providers of gaming services
- Critical Gaming Supply Licence for suppliers
The MGA and the 4 licence classes for gambling
- Type 1: Gambling against the operator with a random number generator such as casinos or lotteries
- Type 2: Sports betting and e-sports with fixed odds
- Type 3: Player-versus-player games such as poker and bingo
- Type 4: Controlled skill games such as strategy and fantasy games
The 3 stages of certification
- Analysing the function of the gambling service, assessing the operational process, finances and management
- Analysing business plans and forecasts
- Fulfilment of the operational and legal requirements of iGaming
A gambling licence in Malta is of interest to entrepreneurs and start-ups who are not afraid of a strictly regulated environment and annual compliance checks.
Are the tax systems of the countries simply comparable?
Indeed, depreciation or bases of taxation may be interpreted differently. For comparing tax systems, an OECD standard has emerged in international accounting. Your tax approach may differ from industries in other sectors and have different effects in different countries.
What are the EU and FATF country lists?
The Financial Action Task Force (FATF) identifies countries with strategic deficiencies in systems to combat money laundering and terrorist financing. They pose significant risks to the international financial system and are considered high-risk countries. The FATF was founded in 1989 and is an international organisation of the OECD. It compiles the most important list of countries that promote money laundering and terrorism. It may differ from the EU list of countries. Why? It appears that the EU is not looking very closely at the member states. As the diesel and emissions scandal, cum-ex, misappropriation of subsidies and tax funds by governments and the EU corruption scandals have shown, a little corruption in a government and turning a blind eye to money laundering can be seen as a competitive advantage by entrepreneurs.
Permanent guests on the FATF country list:
In addition to North Korea, Yemen and Iran, there are Barbados, Gibraltar, Jamaica, Jordan, the Cayman Islands, Morocco, Trinidad and Tobago and the United Arab Emirates.
Anecdote: The fraudulent financial services provider and former DAX group Wirecard invested the majority of its assets in the Philippines, which has been on the FATF’s grey list for several years. When EUR 1.9 billion booked in Singapore was transferred to a Philippine bank in a cloak-and-dagger operation, this was no reason for the international auditing firm Ernst & Young to conduct a proper review. The auditing of ‘parked’ means of payment in FATF countries is usually part of serious and mandate-orientated consulting.
What is the exit tax?
Some countries want dissatisfied entrepreneurs to be “squeezed like a lemon” one last time before they leave. Thus, individuals with equity interests in capital companies may face exit taxation on estimated profits lasting up to ten years. Potentially realized hidden reserves may no longer be tax-effective expenditures. Exit taxation secures the “right” to taxes by the country upon departure of shareholders. With careful preparation, you can partially or ideally completely avoid exit taxes.
World of Malta insider tip: And when does unlimited tax liability really end?
That depends, you will hear from the lawyers. In most European countries, unlimited tax liability ends when you give up your place of residence, i.e. when you have no habitual residence in the country. You are often not allowed to stay in the country for more than 182 days per year. The counting period can be from 1 January to 31 December and the last 12 months. Arrival and departure days are counted differently.
What legal forms are possible for start-ups in Malta?
- Branch Office – Branch office with liability of the parent company
The Maltese Branch Office is a favourable start-up option for companies wishing to do business in Malta
- European Company (SE) – public limited company for EU-wide activities
The Societas Europaea operates in several EU countries and flexibly utilises the advantages of the national legal systems. With the European Company (SE), groups merge or amalgamate parts of companies across national borders in the member states. The European Company (SE) is supervised by the Malta Financial Services Authority (MFSA).
- Foundation – Foundation model with its own foundation board
A Maltese foundation requires a founder along with their assets plus a board of trustees.
- General Partnership – Joint unlimited liability of the partners
A Maltese general partnership is a partnership. As a separate legal entity, it can own property independently of its partners.
- Limited Liability Company (LLC) – Private or public limited liability company
The LLC is based on British company law. The Maltese Companies Act of 1995 regulates the LLC, which is supervised by both the Malta Financial Services Authority and the Maltese Commercial Register.
- Limited Partnership (Malta Ltd.) – combination of unlimited and limited liability
A Maltese limited partnership (LP) consists of at least one general partner (GP) with unlimited liability and one or more limited partners (LP) with limited liability. The general partner has unlimited liability for the liabilities of the company and can be a holding company. The limited partner is liable with the capital contribution. A private LLC has the suffix ‘Limited’ or ‘Ltd.
- Public Limited Company (Plc) – liability limited to share capital
A Maltese Plc (public limited company) is a company with limited liability. The liability of the shareholders is limited to the share capital. In accordance with Chapter 138, a Plc requires a company secretary. The Plc is supervised by the Malta Financial Services Authority (MFSA).
- Public Limited Partnership (PLP) – unlimited, joint and several liability
PLP is a personal partnership.
- Partnership en commandite – Limited partnership with mixed liability
A Maltese partnership en commandite (the limited partnership) is a company with limited liability. It consists of at least one general partner (GP) with unlimited liability and one or more limited partners (LP) with limited liability.
- Self-employed – sole proprietorship with full personal liability
A self-employed person is a freelancer, digital nomad or sole trader. The owners are personally liable for all liabilities without limitation.
In addition, the SICAV for investment funds and the trust as a fiduciary company also exist in Malta. Companies are categorised by the government according to size:
- Micro companies with up to 9 employees
- Small companies up to 49 employees
- Medium companies up to 249 employees
- Large companies with 250 or more employees
Some company forms require a company secretary or company administrator. Their administrative duties include keeping registers and records and filing statements and other documents. This includes the register of shareholders and the bond registers.
How often are tax audits carried out in Malta?
It has been known for hundreds of years: The higher the taxes and the more complex the tax system, the more states invest in checking tax returns. This in turn generates costs.
Long story short: in countries with low tax rates and little bureaucracy, it is hardly worthwhile for companies to take risks for small tax savings. Countries such as Malta save high tax audit costs, which in Germany are estimated at over EUR 1 billion per year. This means that German tax investigators are ‘almost forced’ to squeeze added value for taxpayers out of companies.
Further information and register a company or business:
BUSINESS 1ST OFFICE
2nd Floor, Cobalt House
Notabile Road
Mrieħel Industrial Estate
Mrieħel, B’Kara,
BKR3000
Winter opening hours (September-June):
Monday, Tuesday, Thursday 08:00 – 16:00
Wednesday 08:00 – 19:00
Friday 08:00 – 13:00
Summer opening hours (July):
Monday, Tuesday, Thursday, Friday 08:00 – 13:00
Wednesday 08:00 – 19:00
Summer opening hours (August):
Monday to Friday 08:00 – 13:00
Email: [email protected]
Internet: businessfirst.com.mt
Customer service: 0356 144
Monday to Friday 08:00 – 16:00
Some company forms require an annual general meeting
Some types of companies in Malta are obliged to hold an annual general meeting. The LLC (Limited Liability Company) must hold this annually. By unanimous decision of the company, the meeting can be held anywhere in the world. Your flexibility is increased by the authorisation of digital general meetings.
World of Malta insider tip: Converting a corporation into a partnership
You convert your Maltese corporation into a partnership by means of articles of association. As a rule, auditing is then no longer required, but this does not release you from bookkeeping.
Statistics: The most common types of companies in Malta in 2023
- 40,500 sole proprietorships, freelancers and partnerships
- 15,700 Ltd. and Plc.
- 250 non-profit organisations, foundations and state-owned companies
Source NSO Malta
When do 0 per cent, 5 per cent and 35 per cent tax apply?
Taxes in Malta: Extract from Malta’s Individual, Corporate and Other taxes
| Type of company | Tax rate | Program |
|---|---|---|
| Non-EU Digital Nomads | 10 % | Nomad Residence Permit |
| Ltd. with holding structure | 5 % | Maltese holding companies |
| Self-employed | 15-35 % | Graduated tax rate |
| Value added tax (VAT) | 18 % | Consumption tax within Malta reduced rates of 7 % and 5 % on medical devices, electricity and eligible items |
| Inheritance, estate and gift taxes | 0 % | No Tax in Malta |
| Stamp duty from 200,000 euros Real estate and shares in companies | 3,5 % 2 % Gozo | On Malta Real estate and shares in Maltese companies after death |
What does a non-dom status mean?
Non-doms are foreigners from countries such as Malta, Great Britain, Ireland or Cyprus. Malta offers you tax privileges. The non-dom status enables the ‘remittance basis of taxation’. For persons with non-dom status, taxes in Malta are generally only due on income from Malta. Foreign income is only subject to a minimum tax of €5,000 for income of at least €35,000. Additional foreign income imported into Malta is subject to regular taxation in Malta. However, one advantage is that this tax burden is credited against the minimum tax of €5,000.
Avoid these top 11 tax traps
Do not rely on unsubstantiated claims from the media and Internet about a simple, informal company formation or relocation to Malta. The former pirate island pays strict attention to compliance with its laws. Ten relevant tax types and business transactions in Malta are:
- Provisions for tax rebates and discounts
- Compliance with accounting and reporting obligations
- Inheritance and gift taxes
- Capital gains tax on dividends and capital gains
- Sanctions for violation of the tax regulations
- Social security contributions
- Taxes for the employment of workers
- Taxes on rentals and leases
- Taxes in connection with the conclusion of contracts and transactions
- VAT in connection with cross-border trade (reverse charge)
Comply with the 183-day rule and nothing can happen. Does this apply in every country?
Tax law in Malta does not recognise a fixed daily limit for entrepreneurs and self-employed persons (colloquially known as the 183-day rule). This means that the length of stay known from the OECD-MA does not apply in Malta. Check the rules of the host country to see after what length of stay they trigger a tax liability there. In simplified terms, the ‘counting period’ is relevant:
- Calendar year
- Tax year or the last 12 months
- Arrival and departure day
- Holidays
- Leap year
For example, the 12-month period has applied to employees posted to Malta since 1 January 2002. Excellently networked tax authorities have access to flight data, mobile phone providers, stored IP addresses and booking data from hotels and tourism authorities.
Anonymity through fiduciary managing directors in Malta or shareholders! Is this possible in Europe?
- Shareholders are usually published in the publicly accessible transparency register.
- Your bank expects you not to conceal any shareholding (reportable in the event of suspected money laundering).
- The international exchange of information (OECD CRS) provides your tax authority with information on trusts, foundations and fiduciary interests.
- Lawyers and tax advisors as fiduciaries risk violating the law if they support a concealment.
- Taxpayers in their home country may have to report their foreign shareholding to the tax authorities without being asked if a percentage threshold is exceeded.
Refuse to make a statement to the tax office as a defendant! This is not advisable.
Taxpayers cannot refuse to testify to every tax office without consequences. In many countries, the tax law is based on the
- (increased) duty to co-operate
- Cooperation between taxpayers and tax authorities,
- Reversal of the burden of proof.
Your tax return or declaration will stand up to official scrutiny. Refusal to provide information typically leads to an estimation. In addition, you may be subject to late payment penalties and fines for tax evasion.
Banking secrecy protects you from the critical eye of the tax authorities! Too much trust?
Reality: In many countries – including Germany – the tax office can access account balances
- In many countries, banking secrecy expires upon death.
- Death obliges the banks to report the account balance in many countries.
- International agreements permit the automatic exchange of information (AEOI).
Thanks to a letterbox company, a trustee conceals the owner! Officially unthinkable in Malta.
Letterbox companies, such as those at 1209 North Orange Street in Wilmington (Delaware), with over 200,000 companies, are impossible in Malta. By the way, the American ex-president Joe Biden was a senator in the world-famous US tax haven Delaware from 1973 to 2009. With a Limited company domicile in Malta combined with a holding concept, you legally pay 5 per cent tax. In addition, you create substance in Malta with the sustainable establishment of an operationally active permanent establishment. A registered office alone is usually not enough. The Ltd. is owned by shareholders from abroad (non-dom status) or a holding company. As the owner, you can be the director for all holding companies and the limited company, provided you live in Malta. The director is similar to the function of a managing director or board member. The legal requirements are significantly higher than for a managing director in Germany.
Tax authorities must recognise tax-privileged companies in Malta due to freedom of establishment! Really?
In order for your tax authority to recognise the tax advantages in the countries of the European Union with corporation tax below 25 percent, you must provide evidence of the following in accordance with a ruling by the European Court of Justice:
- A commercially organised business operation
- A head office
- Active income
The home office is possible as a business operation for ‘smaller companies’. Similar rules apply in many EU countries and non-member states.
A nominee director is cheap, disguises and increases profits! As long as it works.
A trustee director, sometimes used as a ‘straw man’ to disguise this, with a number of other managing director or director positions, is not necessarily recognised. This is because the reliability of directors is approved or rejected by the government. Fiduciary directors or nominee directors are identified by the tax authorities in the commercial registers. A ‘breakfast director’ without powers appears favourable. However, both sides run a high liability risk.
Not pursuing a business purpose, but inventing one for Limited! Why doesn’t that work?
A legally valid Malta Limited generates the majority of its income from its chosen business purpose. This includes income from:
- Production,
- Trade,
- Service,
- from borrowing and lending capital,
- and income from profit distributions from corporations.
If necessary, the tax authorities expect the business to be organised in a commercial manner. Without sufficient active income, there is a risk of tax avoidance.
Corporation tax in Malta is always 5 per cent! Really?
Corporation tax in Malta is 35 per cent. The Maltese tax office (Ministry of Finance) refunds up to 6⁄7 of the tax to foreign shareholders. Holding models are suitable for this refund. Without a legally sound structure, corporation tax can amount to 10 per cent or 35 per cent. The inflow to the country of residence, such as Germany, results in income tax there.
Warehouse on the European mainland! If the delivery of goods via Malta is too expensive.
If you make deliveries from another country, this may trigger a tax liability in the country of the distribution centre.
Declare residence in Malta for appearance’s sake! Who likes to play poker?
The temptation to cheat on taxes, even in a tax haven such as Malta, may be there for a few entrepreneurs. But caution is advised – prominent cases with bogus residences abroad show the risks. The danger is not posed by liberal Malta, but by the actual place of residence. Two examples illustrate the dangers or risks:
Boris Becker: The former German tennis star failed with his bogus residence in Monaco. The tennis star’s downfall: an attentive tax official collected newspaper articles about Becker’s stays in Germany. The tax concession for Germany was cancelled retroactively.
Shakira: The Colombian singer was convicted of tax evasion in Spain. She was unable and unwilling to prove that she lived in the Bahamas from 2012 to 2014 while she was actually staying in Spain with her son, who was born in Barcelona, with her then partner, ex-professional footballer Gerard Piqué. Her longstanding advisors at PricewaterhouseCoopers and the two tax-saving companies in Malta and Luxembourg did not help. Shakira escaped a prison sentence of up to 8.5 years by paying the evaded taxes of around EUR 15 million plus interest and a fine of around EUR 10 million. Another case that has not been finalised until 2024 concerns allegedly evaded taxes of EUR 6.7 million in 2018.
Long story short: these cases show: Tax authorities can easily determine the actual place of residence. Popular methods include:
- Flight data,
- Cash withdrawals,
- Hotel bills,
- Tourist tax and visitor’s tax,
- Social media posts and
- IMSI catcher for smartphone tracking.
Advantages of relocating to Malta and consequences of a fake establishment
In many EU countries, the refund of corporation tax is subject to taxation. A genuine change of residence to Malta with the whole family is crucial for a tax-free refund. Please note:
- Personal and economic ties to the home country outweigh those to the new country of residence.
- A home in the home country that can be used at any time can lead to the application of the tax law of the previous country of residence.
If you have more than one place of residence, sound advice from a licensed expert in international tax matters is essential. Malta’s 170+ incorporation experts require a state Company Service Provider licence. The authority utilises a number of tools for monitoring, with on-site inspections being the most commonly used method. This can either be a comprehensive review of all systems and procedures of the authorised person from top to bottom or a targeted inspection in a specific area.
Would you like more information about double tax agreements (DTAs)?
The agreement in international law avoids double taxation in the country of domicile and in the source country as far as possible. This applies to companies or enterprises, legal entities or natural persons. Special regulations apply to the assets and income of aviation and shipping companies. In addition to income tax law, a DTA usually regulates gift and inheritance taxes and the taxation of motor vehicles. A DTA minimises the risk of your income being taxed twice if two countries have the right to tax it.
What are the double tax agreements (DTAs)?
The purpose of DTAs is to avoid double taxation and prevent tax avoidance. The existing agreements do not cover all possible scenarios, which means that proceedings are repeatedly brought before the tax courts. This is because it is always necessary to assess the circumstances in the overall context and spirit of the agreement.
The OECD and the United Nations (UN) develop model conventions as a basis for negotiations in order to harmonise the legal systems of countries. The EU states usually use the OECD Model Tax Convention (OECD-MA).
Double taxation agreements take into account the principles of international tax law:
- Source country and territoriality principle: Withholding tax is payable if the income was earned in the country.
- Global income principle: All global income is subject to tax in the country of residence.
- Country of residence principle: Tax liability is based on the habitual residence or domicile and the place of management.
If there are deliberate or unintentional loopholes in the DTA, double taxation or even double non-taxation may occur. If necessary, fall-back clauses apply that allow subsidiary taxation by the country of residence or registered office. These regulations are set out in the OECD Commentary (OECD MCC). If there is no DTA between two countries, the respective national tax laws apply, meaning that income can be taxed twice.
It becomes particularly complicated when a DTA overlaps with EU tax requirements.
Common cases for German citizens and their companies in the DTA
For persons with unlimited tax liability in Germany, the global income principle and the country of residence principle apply in income tax law. All income earned worldwide that is taxable under the Income Tax Act (EStG) is taxed in Germany. This often includes interest and dividends from foreign capital investments such as investment funds or company shareholdings. If this income has already been taxed in the source country, the tax can either be partially (credit method) or fully (exemption method) credited via a DTA.
Natural persons without permanent residence in Germany pay tax on their profits and income earned in Germany according to the territoriality and source country principle. The DTA protects you from double taxation or reduces it.
Persons with unlimited tax liability in Germany,
- who work in an EU or EEA country (e.g. Switzerland) as a cross-border commuter
- or temporarily sent abroad in accordance with the Posted Workers Act,
fall under the DBA regulations. In cases regulated by law, recipients of unemployment benefit in Germany can also earn income from work abroad.
What is regulated in a DBA?
The double tax agreement (DTA) plays a decisive role in international tax regulation for fairer tax conditions by avoiding double taxation. Well-known and important regulations are
- Taxation of severance payments
- Partial retirement, block model
- Administrative assistance, exchange of information
- Credit method, exemption method
- Residency
- Temporary employment
- De minimis limit
- Professional driver
- Operating site
- Dividends
- Development aid clause
- Inventor remuneration
- Flight and ship personnel
- Exempt income, progression proviso
- Certificate of exemption
- Arm’s length principles
- Visiting professors, teachers, students, trainees
- Commercial profits
- Equal treatment
- Artists, athletes
- Temporary employment relationship
- Licence fees
- Stock options, share remuneration models
- Progression proviso
- Relapse clause
- Social security
- Maintenance payments
- Capital gains
- Affiliated companies
- Remuneration after termination
- Contractual relationship
- Insurance tax
- Mutual agreement procedure
- Court of arbitration
- Interest
- Time of inflow
How many double tax agreements (DTAs) does Malta have?
The Commissioner for Revenue counted 78 countries with a DTA for 2024. In comparison, the UK has 169, Germany 132, France 128, Austria 93 and the Principality of Liechtenstein 29.
Are transactions with or through employees of the EU, UN or NATO included in the DTA?
No, the salaries of EU member states’ own civil servants and other employees are exempt from national tax. In simplified terms, a privilege protocol applies to employees of the EU, NATO and the UN.
World of Malta insider tip: Before you start – tax advice is important
Apart from the free sales talks offered, which are intended to form the basis for the immediate conclusion of a contract, professional tax advice costs a fee. You will receive some investment grants for your company if the project has not yet been launched. The move to Malta should be comprehensible to the tax authorities of the former countries within the framework of their laws. Do not risk an expensive, perhaps instructive experience by foregoing professional advice. This includes due diligence and reference to the holding model. An incorrect assumption or flawed assessment can cause your project to fail.
Foundations clearly explained step by step
Founding a partnership and sole proprietorship in 3 steps
- Application for self-employment with Jobsplus
- VAT-No. (VAT number) at Ministry for Finance
- Apply for a tax number with BusinessFirst
Set up a limited company in Malta in 7 steps
- Correspondence and scheduling with Malta Business Registry (MBR)
- Registry (commercial register)
- Submit documents to MBR
- Registration of the company by MBR
- Digital foundation certificates
- Apply for a tax number
- Register company seal
Set up a holding company in Malta in 6 steps
- Correspondence and scheduling with Malta Business Registrar (MBR)
- Drawing up and providing a partnership agreement
- Submission of documents and forms to the third country, if resident in Malta
- Submit documents to MBR
- Registration of the company by MBR
- Digital foundation certificates
Form a foreign limited partnership in 5 steps
- Correspondence and scheduling with Malta Business Registrar (MBR)
- Registry (commercial register)
- Submit documents to MBR
- Registration of the company by MBR
- Digital foundation certificates
Foreign shareholders achieve the 5 per cent without a foreign limited company if they do not live in Malta. Otherwise, you need a limited company in a tax-favourable country such as Scotland. Depending on the structure, the 6/7 will be returned after the tax return or the operating company and the holding company in Malta will submit a consolidated tax return. The 35 per cent is then offset against the 30 per cent corporation tax (fiscal unit or tax consolidation). The latter enables a tax-optimised distribution of profits.
Coworking space or business centre as an alternative to the home office
Does your business model not require a production facility, permanent company headquarters with staff and rooms used exclusively by you? Then rent a coworking space in Malta.
Coworking spaces offer a cost-effective alternative to a conventional office, whether for hourly, daily or longer periods. We describe coworking spaces in our article on digital nomads in Malta. From the interview with the Operation Manager of Businesslabs Malta, you can learn details for the practice and receive a discount voucher.
- Low monthly costs
- Technically well-equipped workstations
- Flexibly rent and expand an office space or workstation
- Postal address and secretariat
- Synergy with other start-ups, founders, entrepreneurs and freelancers
- Open 24/7
- Network-Events
Send an email to Businesslabs Malta and receive a 15 per cent discount with the subject: WOM-Welcome
Benefit from Malta's support programmes & EU funding
Obtaining grants and funding from a government or the EU is a major challenge. Malta’s government sometimes awards funding in conjunction with the European Union. These are granted for innovation and digitalisation, regional development and cohesion or even for space travel. We have put together some interesting funding programmes for start-ups and small businesses. The grants and funding programmes are your chance to receive financial support. You receive funding in the form of grants, loans and tax credits.
EIC Accelerator
- for innovative, ground-breaking products and services
- Start-ups and SMEs with fewer than 499 employees
- up to EUR 2.5 million in subsidies and up to EUR 15 million in direct investments
- EIC Accelerator
EU funding programmes and funds financed from the EU budget and NextGenerationEU
- Single market, innovation and digitalisation
- Cohesion and values
- Natural resources and the environment
- Migration and border management
- Security and defence
- Neighbourhood and world
- EU funding programmes and NextGenerationEU
Digital Europe (2021-2027)
These objectives are pursued in 5 sub-areas:
- ‘Supercomputing’,
- artificial intelligence,
- Cybersecurity and trust,
- advanced digital skills,
- Broad use of digital technologies in business and society.
- EUR 7.6 billion in subsidies
- Programme for the Digital Europe funding database
EaSi microfinancing instrument
- Microfinance and financing of social enterprises
- would create jobs
- Microloans up to EUR 25,000
- Belongs to InvestEU programme
- Microfinance and financing of social enterprises
EuroStars
- Cooperation with SMEs in research and development
- between 50-70 per cent of the budget
- yearly 250 MIO. EUR funding
- Eurostars programme
Invest EU
- SMEs, especially in the arts and culture sector
- EUR 6.9 billion in funding
- Invest EU programme
Microinvest – tax credits for small businesses and self-employed
The economic development agency Malta Enterprise supports the Microinvest programme for start-ups, family businesses, small businesses (micro enterprises) and solo self-employed persons (self-employment). Expenditure and investments are subsidised with a tax credit of up to 45 percent.
- Companies with 1 – 50 employees
- Total assets in the tax year and previous year less than EUR 10 million
- Increase in labour costs by more than 3 percent
- Costs for third-party services
- Furnishing, renovating and modernising business premises
- Investment costs for machines, technologies, apparatus and instruments
- Systems for generating alternative energies
- Improving energy efficiency
- Costs for certifications
- Costs for the acquisition of commercial vehicles
- Tangible and intangible assets for digitalisation such as computer hardware and software.
- Malta’s Micoinvest programme
The maximum amount of eligible tax credits in Malta is limited to EUR 50,000 over three consecutive tax years. On Gozo, EUR 70,000 is possible.
World of Malta insider tip: How to find the right law firm or service provider to set up an Ltd.
Generalised statements are impossible. The decisive factor is that the law firm should be a certified service provider (Company Service Providers), specialised tax consultant or auditor (Authorised Registered Mandatories). There are many offers on the Internet that merely sell on the addresses of interested parties or just want to turn a run-of-the-mill whitepaper concept into ‘sounding money’. Another tip: Think about the exit! A collaboration does not always work out satisfactorily. If possible, regulate this in the contract:
- With what notice period can you cancel?
- Is an early change possible for a fee?
- When will you receive your documents?
- How and when will the data be transferred to the new service provider?
- What does the final fee include?
Have these clauses checked by your lawyer before you sign the contract. In principle, law firms and service providers that do not place any insurmountable obstacles in your way when switching are to be favoured. Those who convince with performance do not need gagging contracts with their clients.
Don’t sign a counselling contract immediately after the free consultation just because your brain is now urging you to reciprocate because of the free consultation.
The annual costs of the law firm should not ‘eat up’ the presumed tax advantage. This can have existential consequences in the event of a drop in turnover, a pandemic or simply turbulent times.
Where to find local business partners?
Due to the small size of the archipelago, local business partners are easy to find. Effective strategies include networking at local business events, trade fairs, industry and networking events. You can make direct contact with potential partners there. Facebook groups and LinkedIn are very popular in Malta. Another source of contacts is The Malta Chamber of Commerce
Pros & cons of founding a company in Malta
Tax benefits
Malta has a favourable tax policy and offers various incentives for companies. Double taxation agreements (DTAs) with 78 countries and the EU Parent-Subsidiary Directive apply as of 2024. Malta does not levy withholding tax.
Infrastructure
There is sufficient infrastructure, nationwide hospitals, doctors and pharmacies, gigabit internet and blockchain.
Public Transport
Free public transport for Maltese residents.
Economic growth
Malta has stable economic growth of over 6 per cent in the past 10 years until 2024. The Covid-19 year 2020 with -8.61 per cent was taken into account. Source World of Economics Data Base
Labour costs
Labour costs are around the middle of the European Union. They are 40 – 60 per cent lower than in Germany or the UK. The minimum weekly wage for people aged 18 and over is EUR 221.78 for 40 hours of work per week.
Official language
Malta has English as its official language alongside Maltese.
Qualified labour force
The labour force in Malta is considered highly qualified, especially in marketing, gaming, finance and IT.
Currency
Even in the almost digital banking world, companies save costs for currency hedging and exchange fees if their country belongs to the euro currency countries.
Small country
Malta is one of the smallest countries in the world in terms of surface area. The domestic market is limited to around 560,000 inhabitants. However, Malta’s plan is to attract over 80,000 digital nomads plus family members.
Market companion
Malta’s ‘desired’ industries such as construction, sports betting, gaming and gambling are highly competitive, which makes it difficult to find qualified employees.
School
Maltese is mostly spoken in Malta’s schools. English is commonly spoken throughout public schools.
Home ownership and renting
Rents are high in relation to income. Prices for residential property are on a par with those of medium-sized German cities.
Dependence
Malta’s economy is dependent on tourism, the construction industry and gaming. As the first crypto and blockchain location in Europe, Malta has hardly been able to realise any benefits.
Unemployment rate
Malta has had an extremely low unemployment rate of around 3 per cent for many years. This is good news for the residents, but bad news when it comes to finding qualified workers. The only option is often to look abroad.
FAQs - Do you have any questions? We give you the answers!
Is a Malta Limited suitable for everyone?
No, not all sectors are suitable for the Maltese limited company. For example, property transactions are often taxed in the country where the property is located. If they do not relocate production to Malta, these companies are less suitable for the Malta Limited. The considerable costs of a holding model can erode the tax savings in times of crisis and declining sales.
What are the formation costs for Malta Limited and sole proprietorships?
If you (can) do without legal advice, the costs of setting up a sole proprietorship are zero EUR. With a limited company, you need at least EUR 233 for the capital contribution (20 per cent). The costs for legal advice depend on the scope of the tasks assigned to you. If you do not want to do anything on your own, the costs will be above EUR 3,500. If you take care of the authorisations and opening the business account, the costs of incorporation could fall below EUR 2,000.
How is the centre of life defined?
Long-term residence, social and family ties, regular place of work or place of activity are among a number of points. A transfer of residence to Malta is a mandatory requirement to prove the centre of life and to avoid paying tax in your home country.
Is a bank account with a Maltese bank required for incorporation?
How high are the taxes with a Malta Limited?
The corporation tax rate in Malta is 35%. With a holding structure, foreign shareholders can receive a refund of up to 6/7 of the corporation tax paid.
Are dividends from a Malta Limited taxed?
Dividends and capital gains are tax-free in Malta.
How is a Malta Limited founded?
You can set up a limited company in Malta on your own or with the help of a certified corporate service provider such as a tax advisor or solicitor.
How can a company in Malta permanently not pay corporation tax?
Tax experts believe that the 0 per cent tax claim for successful entrepreneurs is a rumour. No country in the European Union is interested in resident companies not paying taxes anywhere. After a tax audit, there is a risk that there is an abuse of tax planning and/or tax evasion. However, income earned outside Malta is tax-free if you do not transfer or import it to Malta. In addition, taxes of 5,000 euros can be deducted via the non-dom status. Digital nomads receive tax relief under certain conditions. The usual rate is 10 per cent.
Can shareholders in Malta receive shareholder loans?
No, a tax-privileged shareholder loan is not common for Maltese companies.
Does an international consultancy firm advise on countries outside Malta?
Internationally orientated law and tax firms in Malta do not necessarily advise on relocation to other countries such as Ireland, Switzerland, Hungary, Georgia, Cyprus or the USA. In Malta, ‘international advice’ often means that these law firms have specialised in Malta and advise exclusively on relocations and company formations in Malta.
Is a Malta Limited an offshore company?
The Malta Limited is a legal onshore company. In the EU member state Malta, existing double taxation agreements (DTA) apply to founders and entrepreneurs. You enjoy further advantages with freedom of establishment, freedom of movement and the EU Parent-Subsidiary Directive (Council Directive 2011/96/EU; 30 November 2011).
Does the Beckham Law apply in Malta?
No, the Beckham Law known in Spain does not apply in Malta. Tax benefits include EU subsidies, the MicroInvest programme and the holding model.
Is e-billing mandatory in Malta?
Legal notice and disclaimer: Despite careful checking, the information on this page may contain errors or be out of date. It does not replace legal or tax advice. World of Malta accepts no liability for the content, completeness or effect of the statements. World of Malta provides information free of charge and aims to serve as inspiration. We strongly encourage every reader to check this information independently.
Thank you very much for giving us your time.
Reliable sources on Limited and legally secure company formation in Malta:
§ 1 AEAO Gewöhnlicher Aufenthalt
Admin (2020, 3. Dezember) Mitwirkungspflichten der Beteiligten (§ 90 AO)
Malta Business Registry online incorporations
Microinvest – Tax Credits for Micro Enterprises and the Self-Employed.
OECD-Musterabkommen zur Vermeidung von Doppelbesteuerung
