Doing business in Malta

Starting a business

A private limited company is formed by registering a memorandum and articles with the Malta Business Registry; minimum share capital is low (€1,165, 20% paid up) and incorporation is usually completed within days. Sole traders register as self-employed with Jobsplus and the Commissioner for Revenue and pay Class 2 social security contributions. Business First and Malta Enterprise provide start-up support and schemes.

Taxation of companies

Companies are taxed at 35% on profits, with Malta's full imputation system under which shareholders receiving dividends may claim refunds of part of the tax paid, resulting in lower effective rates in many structures. Rules change: confirm with a licensed tax adviser. See Tax.

VAT

The standard VAT rate is 18%; businesses above the registration threshold must register, file returns and charge VAT; reduced rates apply to listed supplies.

Employing staff

Employers register with Jobsplus, operate the Final Settlement System for tax and social security, and follow the Employment and Industrial Relations Act. Non-EU hires need a single permit. See Work.

Banking and accounting

Opening a business bank account requires full due-diligence documentation and can take time; several banks and electronic-money institutions serve companies. Annual accounts must be audited (with small-company exemptions) and filed with the Registry.

Licensing and regulated sectors

Trading licences are issued by the Commerce Department and local councils; financial services (MFSA), gaming (Malta Gaming Authority), tourism accommodation (Malta Tourism Authority), healthcare and food businesses have sector regulators.

Investment environment

EU membership, English-speaking workforce, a services-oriented economy and incentive schemes attract investment; small size, labour shortages and housing costs are the constraints most often cited.