The Gateway to Europe - Benefits of Company Formation in Malta
Malta is not an offshore jurisdiction. Company formation expenses in Malta are relatively low, thus making Malta a cost effective jurisdiction, not only or large corporation's tax planning, but also for small and medium sized businesses.
Valletta, Malta, November 2, 2014 (Newswire.com) - As an independent member state of the European Union centrally located in the Mediterranean, benefiting from good international connections to major European cities and financial centres, including London, Frankfurt and Paris, and a modern communications infrastructure.
• Low corporate tax (maximum of 5% or lower effective tax rate for trading companies)
• Strategic geographical location in the centre of the Mediterranean
• Extremely stable economy and government
• Provides the investor with a stable investment atmosphere
• Offers the investor unsurpassable tax benefits
• effective regulation of corporate service providers by serious, but accessible and responsive, regulators
• cost-effective solutions delivered by legal, tax and accounting specialists
• industry-leading anti-money laundering and transparency protocols
• a double tax-treaty network extending to 65 states
Malta has transposed all EU anti-money laundering and prevention of financing of terrorism legislation. Corporate service providers and professional advisers assisting with company incorporations and corporate structuring are required to identify ultimate beneficial ownership and perform appropriate due diligence in their regard.
Maltese holding companies can be used for a variety of purposes, including holding real assets like property, shares and securities and intellectual property, and intangible assets such as copyrights and patents, and shareholders benefit from a full imputation system under which tax can be reduced to 0% in certain circumstances. However, Malta does not operate a specific holding company regime as such, meaning that holding companies must be constituted as regular public or private limited companies.
A Malta holding company is a company resident in Malta and pays tax on its net income. However, Shareholders of Malta holding companies qualify for a full refund of the Maltese tax paid by the company on profits and gains arising from "participating holdings" when such profits are distributed. For a Maltese resident company to hold a "participating holding" in a company incorporated abroad, it must hold at least 10% of the equity shares in the non-resident company. To qualify for the participation exemption, the foreign subsidiary must satisfy one of three criteria: be resident in the EU; be subject to foreign tax of at least 15%; and not derive more than 50% of its income from passive income.
Corporation tax in Malta is currently set to 35% on the company's worldwide income. However, both for trading companies and participating holding ones there are in place provisions for the partial return amount paid, directly to the shareholder. The amount of compensation is generally 6/7 of collected tax of 35%, with the result that the tax is often reduced to 5%. No withholding taxes, stamp duties or exchange controls apply to the distribution of profits from a Maltese company to non-resident shareholders which can be expatriated without restriction. Distributions made from profits derived from passive income such as interest and royalties, entitle the shareholder to claim 5/7ths of the tax paid by the company.
Malta's tax system include an absence of thin capitalisation and transfer pricing rules, and no exit taxes on companies when shifting their tax residence to another jurisdiction. Additionally, corporate losses may be carried forward indefinitely, and there are no exchange controls by virtue of the country's membership of the EU.
Malta companies have been used for a wide variety of objects including, trading activities such as the provision of commercial, management, technical and other services, group treasury operations and the international purchase and sale of goods, and holding activities, such as the holding of shares in other companies, intellectual property rights, loan rights, bank accounts and other assets, whether tangible or intangible, movable or immovable.
Malta is a highly reputable, low-tax jurisdiction with conservative and solvent banks, a robust legal system and an attractive onshore tax regime and makes it by the way to an ideal Holding Company location.
Registration and support of companies in Malta registered for tax planning purposes. More details find at www.indotco.com