Often clients tell me that a limited company in Malta is an offshore company. I must strongly disagree with that statement. A company in Malta is not an offshore company. This is especially relevant when it comes to external relationships and technical distinctions. An offshore company is fundamentally different, and also treated differently by authorities. In this article, I will explain in more detail three arguments that show that a company in Malta is not an offshore company.
Malta is a fully entitled EU member state
Malta has been a member of the European Union since 2004. It has the same rights and obligations as all other member states. EU member states have to follow the laws of the EU. Countries offering offshore companies are usually trying to do the opposite. As a full member state of the EU, Malta offers all residents of Europe the easy and uncomplicated possibility to become a resident of Malta, or to settle with their company on the island.
The same accounting obligations as any other company
Agencies for company formations are often advertising the fact that there are no accounting obligations in countries such as Belize or St. Vincent. What looks tempting at first glance, may cause problems when the company has to be presented to the local authorities. The situation is different with a Maltese limited company. There are regular accounting duties, just like in any other EU country. This means that every company needs to do their bookkeeping, and they also have to be able to present their accounts.
A limited company in Malta basically pays the same tax as any other European company. Every company has to pay 35% corporation tax in Malta. However, if one of the shareholders is not Maltese, it is possible to get a refund of 6/7ths of the tax burden if the company is structured accordingly. However, the tax liability still exists and it cannot be circumvented.