Tax Compliance & Advisory

Malta’s status as a member of the European Union and the adoption of the Euro as Malta’s currency in 2008 have made Malta a jurisdiction of choice for many investors, many of whom decide to locate their businesses in Malta due to the advantageous corporate tax system.  One of the attractive benefits to persons who choose Malta as the jurisdiction where to set up their companies is the income tax system available to any business in Malta.

Malta’s tax legislation provides a number of incentives to shareholders of Malta companies deriving income from their investments and/or trading activities, whether derived from Maltese companies or companies outside Malta.

Four forms of relief from double taxation are available, including Malta’s far-reaching double tax treaty network. First, the Malta company is granted relief from double taxation in cases where the income of the Malta company would have also suffered tax in a foreign jurisdiction.  This ensures that the same income will not be subject to tax twice in two different jurisdictions. In addition, when income received from investments and/or trading activities is distributed by companies by way of dividends, a refund of the tax paid by the companies becomes due.

The amount of the tax refund depends on whether the investment constitutes a “participating holding” or otherwise.  Tax refunds are also available to shareholders receiving dividends from their foreign companies, distributed out of profits arising in Malta through an overseas branch registered in Malta.

Income derived from a participating holding will qualify for a participation exemption, intended to exempt from tax dividends and gains derived from such holdings.  In the case of income deriving from a participating holding and which thus qualifies for a participation exemption, one may opt to pay the Malta tax due and claim a 100% tax refund. In addition, upon receipt of a dividend from companies, shareholders will become entitled to a refund of 6/7ths of the total tax paid (i.e. including the overseas tax).

The total tax refund will, however, be limited to the Malta tax paid so that the total effective tax rate paid in Malta will be 6/7ths of the 35% flat rate of income tax that the Malta company is to pay before applying for a refund.

VAT Compliance and Advisory

Value Added Tax is perhaps the most complicated and often dangerously ignored tax. We can take the burden of VAT compliance off your business' shoulders by completing your quarterly or annual VAT returns and ensuring their timely submission to the VAT Department. In addition, our VAT specialists are always ready to advise on the correct VAT treatment of a particular transaction.

Our VAT team can also assist with setting up internal systems and procedures which assist in generating VAT returns.  They can also conduct reviews of VAT returns and accounting records. In addition, the team has experience with businesses and entities that are partially exempt, exempt without credit, or undertake non-business activities.

Malta VAT Compliance: Our Services

Through our Malta VAT tax experts, we provide the following services:

• Advice on whether to register for VAT
• VAT registration
• Most beneficial method of VAT accounting
• Preparation and submission of VAT returns to the Malta VAT Department
• Intrastat and EC sales reporting
• VAT planning and advice in connection with complex transactions
• Liaison with the Malta VAT Department in connection with compliance visits and disputes
• Deregistration process

Malta VAT Compliance: Our Commitment

Our Malta VAT compliance team can help ensure that your business complies with all statutory obligations under Malta VAT law.  The team will also ensure that your business uses the most efficient VAT structure and that all refunds are applied appropriately.  Our firm provides several essential services to its clients concerning VAT matters, including VAT registration, management of relations with the VAT department and handling of periodic VAT returns.

Should clients wish, we can also carry out a VAT scan which consists of an evaluation of the VAT processes and procedures within a business activity. The main reason would be to propose to the client recommendations to update and reorganise the VAT affairs of the corporation and reduce possible forthcoming complications with the VAT Department. Through this exercise, we also seek to detect potential opportunities for achieving VAT savings and optimisation.