Malta – Ready Made Shelf Companies – Company Formation

Malta

The island republic of Malta is the smallest European Union member both in terms of area and population. The state’s territory consists of three islands: Malta, Gozo and Comino. Formerly a British colony, the country gained independence in 1964.

Location in the Mediterranean Sea, 80 kilometres south of Italy, make it an ideal holiday destination. However, Malta is also known in the film industry as an attractive location for international film productions. The importance of the financial services sector and the gaming industry is growing as well. The official currency in the islands is euro. The country has two official languages: English and Maltese.Maltese company law is regulated by Companies Act. Business entities in the country are required to register with Malta Business Registry. To set up a firm, you need to draw up Memorandum and Articles of Association, reserve a name for your business (the reservation is valid for 90 days) and pay up the initial share capital. Trading companies need to apply for a licence to Trade Licences Unit. Registration fee applies. Its amount depends on the amount of the entity’s authorised share capital and form of registration (electronic or on paper).

A private limited liability company may have from one to fifty shareholders. The minimum share capital is 1,165 EUR of which at least 20% has to be paid up. The amount must be deposited in a bank account. There is no limitation with regard to the number of shareholders or directors. Every company is required to appoint a secretary (a natural person) and to prepare annual returns that must be filed to Maltese authorities.
Corporate income tax is 35%. However a company can apply for a refund of this tax up to 30%. This means effective rate is 5%. The levy is calculated based on the company’s worldwide income and capital gains. The standard rate of Value Added Tax is 18% but reduced 0%, 5% and 7% rates apply to certain categories of goods and services. In Malta there is no withholding tax on dividend or interest payments. Tax losses may be carried forward provided the company continues with the taxable activity. Maltese economy is one of the fastest growing in the EU. It is driven by the service industry, with a significant role of the hospitality sector. Over 2 million tourists visit the islands annually. Malta is a high-income country with good potential for innovation. In terms of purchasing power, it ranks 15th in the European Union. The country of Malta is a parliamentary republic. The government is led by the Prime Minister while the President acts as the head of the state. The country’s legislative body, known as the Parliament of Malta, consists of the House of Representatives and the President. The largest city, Valetta, is the smallest and at the same time the most southbound capital in the EU. Malta has over 25 commercial banks. They are supervised by Malta Financial Services Authority that also grants financial services licences. The authority’s objective is to maintain stability of the financial sector and protect Maltese consumers. The country’s top banks include such institutions as Bank of Valetta, HSBC Bank Malta, BNF Bank, and APS Bank.