Tax Implications of setting up in Malta
Malta offers a liberal tax regime and recent enactments have provided greater flexibility for (specific) sectors to benefit form a more favourable tax regime.
Malta offers a liberal tax regime and recent enactments have provided greater flexibility for (specific) sectors to benefit form a more favourable tax regime.
As a member of the European Union, Malta has synchronised its laws to the European Aquis and legal implications offer the protection of the European system to all its settlers.
Although being the smallest of the European Union’s member states, Malta is emerging as one of the fastest growing financial services centers. English, a joint official language with Maltese, is universally spoken and written and is the language of education and business.
An advance revenue ruling may be obtained from the Commissioner of Inland Revenue in Malta to confirm whether the participation qualifies as a ‘participating holding‘.
Income derived from a participating holding or from the disposal of such holding will qualify for a participating exemption, which is intended to exempt from tax dividends and gains derived from such holdings.
Malta adopts the Full Imputation System where dividends paid by a Maltese resident company carry a tax credit equivalent to the tax incurred by the company on the profits out of which the dividends have been paid.
The taxation of Malta companies can be difficult to understand at first sight, but we are here to break it down for you!
The tax system in Malta is favourable to say the least. There is no tax on donation, no wealth tax, inheritance tax or estate and gift tax.
Maltese legislation provides for four types of relief from double taxation of foreign source income: Treaty Relief, Commonwealth Relief, Unilateral Relief, Flat Rate Foreign Tax Credit (FRFTC).
Citizens of all EU member states do not require any permit to buy their primary residence in Malta. However they do require a permit if they wish to buy immovable property in Malta as a secondary residence, unless they have not resided in Malta for at least five years before the date of purchase.