Incorporation of a company in Malta
Main types of companies in MaltaIn the country of Malta it is possible to incorporate four different types of companies:
- Ltd - Private Limited Company
- Plc - Public Limited Company
- LLP - Limited Liability Partnership
- Unlimited Company
A Plc, instead, is comparable to an Italian S.p.A. and is a company type normally chosen by large undertakings. Its incorporation requires a minimum share capital of €50,000 (or the equivalent amount in another currency). Also in this case, the incorporation of a Plc does not require that the director be a resident in the country and shareholders may be both individuals and companies.
A LLP is a limited liability company, which requires, for its incorporation, at least two members, whose holdings are represented by shares. This company type does not have an equivalent in Italy, in that there partnerships between individuals are subjected to unlimited liability.
The LLP is subject to taxation for transparency, i.e. company revenues shall be taxed to the partners and not to the company itself. Therefore, if the partners do not reside in Malta, the relevant taxation shall apply in accordance with the provisions in force in their own country of residence, while no tax payment shall be due to the Maltese tax authorities.
Finally, an Unlimited Company, whose Italian equivalent might be a società in nome collettivo, provides that each member shall be personally liable, without any limitations whatsoever, with their personal assets for the company’s activities. Also for this company type, taxation for transparency shall apply.
How long does it take to incorporate a company in Malta?
The length of time required is, compared to Italy, much less: it takes between 24 and 48 hours to incorporate a company.
Is there a minimum share capital to be paid up to incorporate a Maltese company?
With regard to Private Limited Companies and Limited Liability Partnerships no minimum share capital is needed: even €1 suffices.
The incorporation of a Public Limited Company, however, requires a minimum share capital of €50,000.
In addition, in accordance with the members’ will, the share capital of a Maltese company might be also expressed in a currency other than the Euro.
Is it necessary to be present there to incorporate a company in Malta?
No. The incorporation of a company, the application to obtain a Maltese VAT number and the opening of a bank account may be managed remotely. The presence of a notary public is not required either.
Is it necessary to be resident on the island to incorporate a company in Malta?
No, there is no such requirement. Both the members and the directors may be non-resident in Malta.
Is it possible to keep the identity of the members of a company in Malta anonymous?
Yes. To protect the identity of the members it is possible to choose to appoint a nominee shareholder or establish a trust. This latter option entails the transfer of the shares by the client to a trustee (who shall become the beneficial owner of the shares), who shall have as their task managing them in accordance with the will of the client and any other beneficiaries.
However, if one chooses to proceed with administration by a trust, the client, from a legal standpoint, shall remain the holder of the shares, while the trust company shall become the holder thereof. The legal owner of the shares shall be able revoke the mandate to the trustee at any time.
Is it possible to appoint a nominee director?
Yes, the client may choose to remain anonymous by appointing a nominee director. To do this it is sufficient to conclude a nominee mandate with a local professional.
The client may maintain the exclusive management of the bank account. The client may withdraw the mandate to the nominee director at any time.
Is it necessary to appoint a sole auditor or a board of auditors?
No, Maltese law does not envisage either. However, it is compulsory to appoint an auditor upon passing certain thresholds.
What documents and information are required to incorporate a company in Malta?
For all members and directors of the company the following are required:
- a copy of the passport or other ID. If one of the members is a company, a company registration certificate or a similar document;
- a proof of residence (residence certificate, first page of one’s own bank account statement, telephone subscription or subscription to another utility).
- surname, forename, place and date of birth and residential address of each member and director;
- name of the company;
- initial capital, number of shares and distribution among members;
- description of the type of activity to be undertaken.
Yes, should the client have this need, it is possible to open a bank account also from outside Malta.
Annual return of a Maltese company: what does it entail?
The annual return is just an updated list of the members that the directors shall file each year with the Maltese companies’ register.
What to do if your company is removed from the register due to the failure to file the financial statements or of the annual return?
If the financial statements or the annual return are not filed, the company shall be removed from the companies’ register of Malta.
It shall be possible to have the cancellation revoked, through a restoration process that would re-assign the shares to the shareholders. Of course, for the restoration process to begin, it is required that the financial statements and the annual return be filed.
Is it possible to confer to a Maltese company a real estate asset located in Italy?
Yes, it shall be sufficient to decide on a capital increase of the Maltese company, to be released through the conferral of the asset. For the evaluation of the asset, contrary to what is the case in Italy, no sworn expert statement is required, and the director alone suffices.
The conferral of a real estate asset shall be registered with a notarial deed, attesting to the transfer of ownership thereof.
Is it possible to open a branch of a Maltese company in Italy?
Of course. To this end it shall be necessary to draft a resolution to establish a branch in Italy, which shall have to be fitted with an apostille certificate in Malta and be filed with a notary public in Italy together with the articles of association and the articles of incorporation of the company, translated into Italian with a sworn translation.
It shall be also necessary to appoint a representative for the branch, whose name shall appear on the Italian companies’ register. With regard to the financial statements, instead, they shall be drawn up in accordance with Maltese law and be filed with the Italian companies’ register.
Our firm is able to support our clients during all phases of establishing a branch in Malta.
May a company incorporated in Malta only operate in Italy?
Yes, that is possible. In this case the company shall be subjected to Maltese company law, while fiscally it shall be subjected to the Italian tax regime.
Is it mandatory for the directors and members of a Maltese company pay social security contributions in Malta?
No, there is no obligation in this regard.
How does the sale of shares of a company based in Malta take place?
The sales operation is very simple and consists of the signing of a stock transfer form by the seller with regard to the shares, without the need for any intervention of a notary public.
Is there a double taxation agreement between Italy and Malta?
Yes, between the Italian Government and Malta there is an agreement (Italian Law 5 November 1990, No 329) in force since 30 December 1990 intended to prevent tax evasion and for the avoidance of double taxation.
Shall Maltese companies always pay taxes in Malta?
Payment of income tax shall be on the basis of the country of fiscal residence of the company. Therefore, if a company with registered office in Malta is then managed from Italy, it shall be subjected to the Italian IRES [corporation] tax on all income realised, not just in Italy, but also abroad. On the contrary, if the company is managed in Malta, it shall be subjected to Maltese taxation on income, paying taxes in Italy only for the income realised there.
Where does a company incorporated in Malta pay its VAT?
If the Maltese company is resident in Italy for tax purposes, it shall pay its VAT in accordance with Italian laws. On the contrary, if the company is also fiscally resident in Malta, it may request a VAT number from the Maltese tax authorities.
May Italian tax authorities object to the use of a Maltese company?
If the company operates in full compliance with the law, incorporation of a company in Malta shall be considered lawful and be subject to no objection whatsoever.
It is necessary to hire employees?
Absolutely not; hiring employees is at the discretion of the company.
For further information on incorporating a company in Malta please contact us on our English number contact + 39 02 36 63 86 10.