Taxation of Malta Trading Companies

Taxation Of Malta Trading Comapnies

Malta’s location at the crossroads of Europe and North Africa and its many years of being a colony has led it to becoming a highly adaptable jurisdiction and accustomed to the challenges brought about by change. During the last couple of decades it has enjoyed political stability and a long period of uninterrupted economic growth. It has been a member of the EU since 2004. Moreover, Malta offers a transparent administrative and legal framework, low incorporation and maintenance costs for businesses and a highly efficient tax regime. It boasts an excellent education system based on the British model and a multilingual, qualified workforce. All of those reasons contribute towards making Malta a perfect location for the setting up of trading companies with an international footprint. Maltese laws place no restrictions on the scope of a company’s business activities and trading is taken to mean anything from buying and selling goods to provision of consultancy services, the development of software or the creation of perfumes. 

Country Highlights

TAX SYSTEM: EU Approved EU: Member of the EU & Eurozone
NO WITHHOLDING TAX: On outbound dividends WORKFORCE: Well qualified, multilingual workforce
TAX REFUND SYSTEM: Possible effective tax rate of 5%. REDOMICILATION: Swift procedure
DOUBLE TAX TREATIES: Broad network of approx. 70 signed DTTs UNILATERAL RELIEF: Double taxation relief without DTT in

Legal Basis

The taxation of Malta companies is governed by the Income Tax Act and the Income Tax Management Act. The Income Tax Act contains the laws regulating the taxation of trading income, whilst the Malta tax refund system, along with other formalities, is regulated by the Income Tax Management Act. 


  • Reputation of an EU jurisdiction
  • Broad interpretation of trading activities
  • No WHT on outbound dividends
  • Gains on disposal of shares by nonresidents are exempt from tax in Malta


Eligibility of Malta Trading Companies

    • The minimum share capital for the formation of a Malta Trading Company is of €1,250, with 20% paid up or the equivalent in any other currency such as but not limited to: US$, GBP, and SEK.
    • A Malta Company requires the appointment of a local director and company secretary. The Director shall be responsible for the day to day management of the company, whilst the company secretary is responsible of the administrative duties - including the keeping of minutes in general meetings and filing of applications when necessary.
    • The documents required for the incorporation of a Malta Trading Company are the Memorandum & Articles of Association, standard due diligence documents and a bank slip confirming payment of initial share capital. APPOINTMENT OF AUDITORS The appointed auditor of a Malta Holding Company must be a Malta registered auditor.

Process & Timeline

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