Malta Offshore Company
- Last updated on . Written by Offshore Protection.
Malta is a traditional tax based system with a number of advantages for foreign and non-resident individuals and companies. Malta has four 'non-resident'—a.k.a. offshore company, the most popular the International Business Company (IBC) formed under the Companies Act in 1995.
Though the offshore sector has been around for a number of years, Malta has had to change its use of the word 'offshore', commonly associated with the international finance industry; and since becoming a member of the European Union, the country has had to reorganize its offshore industry.
In 2004, Malta ceased offering its international offshore companies, though because of its liberal tax laws, it has managed to keep much of its foreign financial business through offering public and private non-resident companies.
A Malta IBC has a restriction on its:
- Right to transfer shares
- Limits on the number of employees (under 50)
- Right to offer the public any of its debentures or shares
Malta is a highly reputable jurisdiction, with a low corporate tax system that attracts many for its modern infrastructure, EU-conforming legislation and superb banking system (ranked 10th for bank soundness by the World Economic Forum). Because of the many rebates and credits given through their tax imputation system, many companies are able to effectively manage to avoid all corporate taxes.
Malta offers several other offshore company formation products, another being the Malta Limited Liability Company (LLC) which can be used for collective offshore investment schemes, partnerships, or any company structure where limited liability amongst is members is required.
Though the price for a Malta IBC is more than other jurisdictions, the superb location, together with its reputation and tax advantages, makes Malta a superb choice for those clients and companies wishing to form a company offshore in the European Union.
For information on Malta as an Offshore Financial Center, click here
Table of Contents:
- Advantages Of A Malta Company Formation
- Key Corporate Features
- Incorporation Package Include
- Requirements For Registration Of A Malta Company
- Corporate Details
Advantages of a Malta Company Formation
- Reputable jurisdiction
- Benefits of being apart of EU
- Proximity to European ports and trading centres
- Single member ownership is available
- Re-domiciliation allowances
- Corporate Tax benefits
- Nominee service availability
- English speaking country
- Any name may be used in the Latin alphabet
- Administrative flexibility
- Asset security
- Modern legislation
- Not a typically associated offshore jurisdiction
- Non resident companies have much of the same benefits as resident companies
- Malta is a signatory to over 70 Double Tax Treaties agreements
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Key Corporate Features
|Malta IBC||Corporate Details|
|Type of Entity||IBC|
|Type of Law||Civil Law (with strong Common Law influence)|
|Governed by||Companies Act 1995|
|Registered Office in Malta ||Yes|
|Shelf company availability||No|
|Our time to establish a new company||1-2 Business days|
|Minimum government fees (excluding taxation)||€245|
|Corporate Taxation||Yes (Credits and refunds come back to shareholders)|
|Access to Double Taxation Treaties||Yes|
|Share capital or equivalent|
|Standard currency||EURO €|
|Minimum paid up||€250|
|Bearer shares allowed||No|
|No-par-value shares allowed||No|
|Publicly accessible records||Yes|
|Location of meetings||Anywhere|
|Corporate directorship allowed||Yes|
|Shareholders / Members|
|Minimum number||Two (possibility of one) |
|Publicly accessible records||Yes|
|Corporate members allowed||Yes|
|Location of meetings||Anywhere|
|Local or qualified||No|
|Requirements to prepare||Yes|
|Requirements to file accounts||Yes|
|Publicly accessible accounts||Yes|
|Recurring Government Costs|
|Minimum Annual Tax||€245|
|Annual Return Filing Fee||€100 – 1,400*|
|Requirement to file annual return||Yes|
|Migration of domicile permitted||Yes|
*Annual Return Fee
An annual fee ranges between €100 and €1,400 (for companies with authorized capital up to €1,500 and €2,500,00 respectively) with discounts of €15 - €300 for electronic submission.
Incorporation Package Include
- Government Registration Fee (First year)
- Registered Office Address (First year)
- Registered Agent Services (First year)
- Company Secretarial Maintenance
- Certificate of Organisation
- Articles of Organisation
- Minutes of First Organisers Meeting
- Ownership Certificates
- Register of Members
- FREE Phone and/or email consultations
How to set up a Company
In order to see up a Malta company a few documents will be needed:
- Register and secure the name of the proposed company
- Memorandum and Articles of Association
- Certificate of Incorporation
- Appointment of a company director(s)
- Registry of members and directors
- Share Certificate(s)
Once your company is formed you can open a corporate bank account which will require KYC and AML verification. All of the steps above can be done virtually, except some countries do require physical in-person visits in order to open a bank account. Get in touch to know the details, as this changes regularly. Once all these steps are completed you will have the incorporation documents sent to your physical address.
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Company Registration Process
In order to register a company, this is what the process will look like:
- Step 1 Offshore Protection works with you to secure a company name with the Company Registry
- Step 2 Offshore Protection works with you to get a Memorandum of Association (MOA)
- Step 3 Offshore Protection helps you to prepare and file incorporation documents
- Step 4 Offshore Protection helps to prepare KYC and AML documents needed to open a corporate bank account
- Step 5 Offshore Protection delivers the certificate of incorporation
Corporate Bank Account
You can open a corporate bank account in most countries around the world with a Malta company. We have banking connections in dozens of countries, though the ones we recommend will be dependent on your situation as some banks require in-person visits, higher capital, more due diligence, and references, while others have minimal requirements.
We suggest getting in touch for a consultation as there are many variables that go into finding the best place to open a bank account for your company.
Malta has a “full-imputation” tax system where corporate profits are taxed at the standard 35% corporate tax rate; however, when dividends are distributed to individuals out of taxed profits, it carries an imputation credit on the tax that has already been paid by the company; and after refund to shareholders, the tax burden decreases to 5%, or 0% in certain circumstances. This inherently eliminates the double taxation that occurs.
Under Malta’s tax law, all income coming from a company that qualifies as a “participatory holding” company also qualifies for a full refund of the taxes paid by the company, when distributions are paid back to the company’s shareholders. Furthermore, provided certain conditions are satisfied, income can be exempted from being taxed, based on the “participation exemption” clause.
There is a Value Added Tax rate of 18% applicable to those companies that are trading within the EU.
Maltese based IBCs also enjoy many other tax benefits including:
- No inheritance tax
- No wealth tax
- No annual property tax
- No tax on interest
- No tax on dividends
- No tax on royalties or licence fees
- No withholding on dividends
Anonymity, Confidentiality and Disclosure
Details of its shareholders, directors, beneficial owner and financial accounts are submitted to the Register and are on public record. However, details of the beneficial owner may remain confidential, if a trustee company is used. Nominee services are also readily available to ensure privacy and confidentiality.
Ordinary shares, registered shares, preferences shares and redeemable shares are permissible for a Maltese IBC.
The minimum capital is €250, with the usual authorized at €1,165. Neither the capital nor any shares can be registered on the public stock market and must be kept within the company.
A minimum of one (1) Director is required to form a Malta Private IBC. A Director may be from any nationality, a resident of any country and may be an individual or a body corporate.
A company secretary is required and must be an individual; in certain cases, it can be the Director.
Meetings may take place anywhere in the world and are not required.
Principal Corporate Legislation
The Companies Act (1995) is based on Common Law and the UK Company Law principles, but is also aligned with the broader EU financial directive. The 1995 legislation replaced the Commercial Partnerships Ordinance, to fit more in line with EU regulations upon entering the European Union. Other financial legislation include:
- Trusts and Trustees Act 1988
- Malta Financial Services Authority Act, 1994
- Investment Services Act 1994
- Banking Act 1994
- Financial Institutions Act 1994
- Financial Markets Act 2002
- Business Promotion Act 1988
Type of Law
Civil Law with strong Common Law influences in company, tax and maritime laws modelled off of the UK.
Shareholders / Members
It is required that a Malta IBC has at least two (2) members who may be an individual or corporate body and may be a resident and nationality of any country. A single-shareholder company is allowed though its director may be a corporate body.
Since 2004, Malta has no exchange controls
Registered Office required
Yes, a registered local office is required for all Malta IBCs
Yes, a local registered office is required where a register of the shareholders and directors is kept.
Financial Statements required
Financial statements and accounting must be prepared according to the International Financial Reporting Standards, and can be kept in any office around the world and may be held in any currency.
A Malta IBCs is required to prepare a financial audit of accounts.
An annual return is required to be submitted by all Malta based IBCs every year. The format of the accounts to be submitted depends on the size of the company.
Small companies – submit abridged balance sheets and profit and loss accounts
If a company meets at least two of the following three:
- Balance sheet is less than €2,562,311
- Turnover less than €5,124,622
- Employees are less than 50
Private companies – also submit abridged balance sheets and profit & loss accounts
If a company meets at least two of the following three:
- Balance sheet total less than €46,587
- Turnover less than €93,175
- Employees less than two
Time required to form offshore company
1-2 days is required to process all of the necessary documents.
A name may not be used that is seen to be undesirable or offensive to the Register, or any name that is similar or already in use
Language of Name
The name of a company may be in any language that uses the Latin alphabet.
Names of Company requiring a special licence or permission
Any IBC involved in, but not limited to investment services, insurance, assurance, banking and other financial services must seek permission and may have to obtain a special licence.
There are no restrictions on trading for a Malta IBC. A company that is seeking to own real estate property must be given appropriate authorization.
The name of the company must end in either “Limited” of “Ltd”
Access to Double Tax Treaties
Malta has signed over 70 Double Tax Treaties
Minimum Annual Government Tax
Minimum registration fee is €245. The registration fee ranges between €245 and €2,250, depending upon the authorized share capital. If the share capital does not exceed €1,500 then the fee is €245.
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