It doesn’t come as a surprise when one decides to establish a company in Malta. The tiny Mediterranean country provides huge opportunities for business success. From favourable tax system to multiple investment programs, the benefits of the single EU market, access to a large talent pool and many more.
Although the process of company formation on the island is fairly fast and simple, compliance with local legislation is non-negotiable. That’s why we have created a step-by-step guide on how to set up an entity in Malta.
Company types to incorporate in Malta
First of all, you need to decide upon what type of firm you are planning to open. In Malta, you can incorporate the following company types:
• Public Limited Liability Company (PLC)
• Private Limited Liability Company (LLC)
The main differences between these two types lie in the share capital, the number of possible shareholders and in the possibility of listing their shares on the capital markets.
Most of business owners choose Private Limited Companies. Every LLC must have at least one shareholder. The shareholder can either be a person or a corporate entity.
In addition to this, local authorities require an annual meeting of the company’s shareholders. However, the shareholders do not have to be local if the director of the company is based in Malta.
Bradford Jacobs is fully equipped to take a shareholder position to represent your company in Malta, also after the registration process.
How to incorporate a company in Malta?
Secondly, it is essential to draft and register the new company’s Memorandum of Association (MOA). The MOA should include the following details:
• Company name
• Addresses and official identification of the shareholders
• The company type (private or public)
• The registered office of the company
• The object and purpose of the company
• Details of the authorised, issued and paid-up share capital
• Judicial and legal representation of the company
• Details and number of directors and secretary
• All of the documents submitted must be in English
The shareholder/s are obliged to submit the above information to Malta Registrar of Companies.
Registered Office in Malta
Furthermore, every Maltese company must have a registered office on the island.
Legal Requirements & Accounting
It is important to bear in mind that companies registered in Malta must have their financial statements audited by the authorities at the end of each financial year.
Financial statements should include information relevant to the authorities, such as:
• directors’ report,
• the auditors’ report,
• a balance sheet,
• profit and loss account,
• related notes to the financial statements,
• together with schedules to the profit and loss account.
Bradford Jacobs offers complete accounting and payroll services for your Maltese company. Additionally, we collaborate with third-party auditors.
Taxation of your company in Malta
As mentioned above, the big plus of a setting up a company in Malta is tax benefits. The country is currently holding close to 70 Double Tax Treaties avoiding double taxations for a vast majority of countries. Also, Malta holds some exciting opportunities when the corporate structure is well-planned and thought out.
The biggest asset is tax reductions granted to the shareholders of locally-registered companies. The overall net effective tax rate could be reduced from 35 % to 5% in case of trading companies, and up to 0% in case of holding company structures.
There are restrictions when it comes to naming your newly-found entity, depending on the company type:
• Endings and abbreviations are required (i.e.Limited/LLC.)
• The name must be spelled in the English alphabet
• You cannot register a name that is similar enough or identical to already registered ones
• You cannot register misleading or offensive names
Reservations of a name against a fee are possible, and the process of verifying the availability of a name might take one working day.
How long does the process of a company formation in Malta take?
It takes 48 hours after the receipt of all original documents to open a company in Malta. Though, sometimes this process might take up to three working days.
How much does company formation in Malta cost?
The government fees for company formation might vary. Expenses have to be paid to the Registrar of Companies upon the incorporation of the company. Additionally, an annual fee of €100 applies, this fee is payable together with the submission of an Annual Return.
Not ready to establish a company in Malta just yet, but want to test the waters first? Or perhaps you don’t require a permanent entity here because you only have a short-term project? There are many ways to legally conduct business in Malta without forming a company. One of them is International PEO.
Contact us now to find the best solution for you.