Malta is an excellent place to start a business because it is in a good position, has a good tax system, and has a stable economy. But before beginning this journey, it’s essential to know the rules and laws that apply to business entities in the country.
This article aims to provide an overview of the most important corporate regulations and laws you need to know in Malta business registration.
It looks at the steps for forming a company, the legal requirements, and the compliance issues. By the end, you will better understand how to set up a successful Malta company and what legal steps you need to take.
Who Can Open a Company in Malta?
If you are interested in opening a company in Malta, it is important to understand the requirements for eligibility. These requirements are crucial when considering Malta business registration. As of 2023, the rules for business registration in Malta state that a private limited liability company in Malta must have fewer than 50 owners.
Additionally, the law requires that the company must be started by at least two individuals, although there is an option for a special type of private exempt company that can have only one partner. These requirements are crucial to keep in mind when considering Malta business registration.
5 Steps to Starting a Company in Malta
There are five steps to starting a company in Malta: To create a business, you must follow the law and make sure everything is in order.
Types of Business Corporate
When registering a company in Malta, you first need to decide what kind of business entity will work best for you. These are the most popular kinds of entities:
- Private Limited Liability Company (Ltd): This is the most common type of business company, and shareholders have limited liability. The minimum share capital is €1,165.
- Public Limited Liability Company (Plc): Good for bigger businesses with a minimum share capital of €46,587.47 and able to sell shares to the public.
- Partnerships: En nom collectif (unlimited liability) or en commandite (limited liability), where partners contribute cash and share profits according to an agreed-upon ratio.
It’s important to remember that each type of business structure has its own pros and cons, and it’s best to talk to legal and financial experts to figure out which system is best for your needs and situation.
Company Registration Process
After choosing the proper business structure, the next step is to follow the company creation process, which includes:
- Name Reservation: The company name must be booked with the Malta Business Registry (MBR) before the company is formed.
- Memorandum and Articles of Association: The company’s structure must be written and sent to the MBR for registration.
- Registered Office: The company must have a confirmed address in Malta as its registered office.
- Minimum Share Capital: The minimum share capital must be put into a bank account in Malta.
- Company Directors and Secretary: A company must have at least one director and a secretary.
- Registering with the MBR: Once all the required papers and fees have been sent in, the MBR will issue a Certificate of Incorporation, proving the company is legal.
After these steps, the Registrar of Companies will give the company proof of registration to start doing business.
Malta also offers companies that register in the country some tax breaks and other perks, which makes it a good place for foreign investors to put their money.
Taxation and Contributions to Social Security
By using the imputation system and giving shareholders tax refunds, the actual tax rate can be lowered by a lot. Maltese businesses must also sign up for Value-Added Tax (VAT) if they make more than €20,000 in annual taxable sales.
Employers must also pay into social security on behalf of their workers. This is set at 10% of the worker’s gross salary, while the worker also pays another 10%.
Regulatory Compliance
Depending on the type of business, you may need different licenses and permits. Authorities like the Malta Financial Services Authority (MFSA) and the Malta Gaming Authority (MGA) keep an eye on and have rules for specific industries, like financial services, gaming, and drugs.
All companies must follow the Companies Act, which governs business issues, and meet the yearly filing requirements, such as sending the MBR their financial statements and annual returns.
Know Your Customer (KYC) and Anti-Money Laundering (AML) Regulations
Malta’s company formation must follow AML and KYC rules, which are meant to stop money laundering, funding for terrorism, and other financial crimes.
This means conducting background checks on customers, suppliers, and business partners and telling the Financial Intelligence Analysis Unit (FIAU) about suspicious activities.
Can a Non-Resident Set Up a Company in Malta?
Yes, a non-resident can set up a company in Malta. Malta is a good business place, and they accept foreign investment. Before starting a business in Malta, people who don’t live there should talk to a local lawyer or accountant for help.
Non-Maltese citizens can set up different kinds of companies in Malta, such as limited liability companies, partnerships, and public limited liability companies.
But non-residents who want to set up a company in Malta will need to name a resident agent who can receive legal notices on the company’s behalf.
Also, they will have to meet all the legal and regulatory requirements, like getting the proper permits and licenses, registering with the Maltese government, and having at least the minimum share capital.
Conclusion
To start a business in Malta, you have to follow a set of rules and laws. First, the company must be registered with the Malta Business Registry and get the appropriate permits and licenses from the proper authorities.
A business must also keep good accounting records and financial statements every year. It is also necessary to follow tax laws, job laws, and health and safety rules. Laws against money laundering and supporting terrorism must also be followed by businesses.
If businesses follow these rules and regulations, they can shop in Malta and help the economy. Companies should talk to a professional if they want to make sure they are following all the rules.
FAQs
What are the tax obligations for corporations in Malta?
The company income tax for businesses in Malta is currently set at a flat rate of 35%. Businesses may also have to pay VAT, payments to social security, and other taxes and fees.
What are the labor laws in Malta?
In Malta, the labor laws spell out the rights and responsibilities of both companies and workers. For example, there are rules about the minimum wage, working hours, annual leave, sick leave, and other employment benefits.
How do I find out more about how to start a business in Malta?
You can get more information about starting a business in Malta from the Malta Business Registry, the Malta Financial Services Authority, the Malta Chamber of Commerce, or an expert advisor.
