Start­seite » Fre­quent­ly Asked Ques­tions

FAQ

THE VAT FOR MY YACHT WAS ALREADY PAID IN FULL IN THE EU.

In that case, it prob­a­ble does not make sense to take part in the VAT pro­gram.

WHEN DOES FORMING A COMPANY IN MALTA MAKE SENSE?

That depends on your par­tic­u­lar case and what you con­sid­er that makes it “worth it”. If you don’t want to move to Mal­ta, it usu­al­ly makes sense where there are annu­al prof­its involved of more than EUR 750K, or if you do want to move to Mal­ta where there are annu­al prof­its of more than EUR 100K.

WHAT DOES THIS COST ANYWAY?

IDR charges set-up costs of EUR 15,000, where­by this depends pri­mar­i­ly on the type of ser­vices.

WHY IS IT SO EXPENSIVE?

We don’t think it is expen­sive at all. You are not just pay­ing for com­pa­ny for­ma­tion but for an inter­na­tion­al advi­so­ry and con­sult­ing pack­age. A major por­tion of our work actu­al­ly does not involve the actu­al for­ma­tion but pro­vid­ing and apply­ing the full band­width of our know-how in regard to the ever more com­plex inter­na­tion­al tax frame­work to your spe­cif­ic case.

HOW LONG DOES IT TAKE TO FORM A COMPANY?

About 3 months to com­plete every­thing.

ARE TAXES IN MALTA REALLY ONLY 5%?

No. The cor­po­rate tax rate in Mal­ta amounts to 35%. Cer­tain share­hold­ers can, how­ev­er, claim back 30%. The VAT-effec­­tive tax rate there­fore amounts to 5% in Mal­ta.

SO I WILL ONLY BE PAYING 5% TAXES, RIGHT?

No. When any share­hold­er of a Mal­tese LTD receives a div­i­dend or a tax rebate, they are still required to pay all of the tax­es due on it in their home coun­try. Always cal­cu­late this as 5% + (95% x tax in home coun­try) to deter­mine the full tax bur­den. If you move to Mal­ta, how­ev­er, there are oppor­tu­ni­ties to sig­nif­i­cant­ly low­er your tax bur­den pur­suant to the effec­tive 5% rate.

WHAT ISSUBSTANCE IN MALTA“? WHAT DOES IT ACTUALLY MEAN?

For our clients set­ting up a com­pa­ny in Mal­ta, but not actu­al­ly mov­ing to Mal­ta, cre­at­ing “sub­stance in Mal­ta” is the most impor­tant issue. It is by no means enough to sim­ply use the com­pa­ny that we have formed for you in the intend­ed man­ner. You will need a real man­ag­ing direc­tor, a real office and real employ­ees. If you can­not or do not want to do this, then we advise you not to form a com­pa­ny in Mal­ta. If, how­ev­er, you are will­ing to move your pri­ma­ry place of res­i­dence and the cen­ter point of your life to Mal­ta, these require­ments will not apply or will only apply in a very lim­it­ed way.

DO YOU PROVIDE TRUSTEE DIRECTORS AND SHAREHOLDERS?

No.

IF I LIVE IN GERMANY BUT FORM A COMPANY IN MALTA, WORK WITH IT AND RECEIVE DIVIDENDS THEN I WOULD ONLY NEED TO PAY A 25% SETTLEMENT TAX? TOGETHER, THAT WOULD ONLY AMOUNT TO 30%? THAT’S NOT BAD, RIGHT?

That works only as long as there is still a set­tle­ment tax in Ger­many. A new­ly elect­ed gov­ern­ment, how­ev­er, might still abol­ish the set­tle­ment tax. Still, even if you only pay 25% in Ger­many, the costs involved in cre­at­ing and main­tain­ing tax­able sub­stance in Mal­ta eas­i­ly amount to at least EUR 100,000 p.a. for office space, man­ag­ing direc­tors, employ­ees, etc. That does not apply, how­ev­er, to clients who actu­al­ly move to Mal­ta.

WHAT IF I SIMPLY DON’T REGISTER THE FORMATION WITH THE TAX AUTHORITIES AND TAKE THE MONEY ALONG EITHER AS CASH OR VIA CREDIT CARDS?

To the extent that you don’t reg­is­ter the Mal­tese for­ma­tion or share­hold­ing, you would be vio­lat­ing the duty to noti­fy and might be sub­ject to a penal­ty of up to EUR 25,000.
You could also become guilty of severe tax eva­sion, and at the very least the auto­mat­ic CRS infor­ma­tion exchange sys­tem would in any event noti­fy the tax author­i­ties in your home coun­try.

HOW LONG DOES IT TAKE TO MOVE TO MALTA WHEN FORMING A COMPANY?

About 3 months to com­plete every­thing.

THAT SOUNDS EASY. ALL I NEED TO DO IS RENT A FLAT IN MALTA AND I’M SET, RIGHT?

No. You of course should also not have a per­ma­nent res­i­dence or reg­u­lar pres­ence out­side of Mal­ta. Specif­i­cal­ly, and among oth­ers, that means you should not have a liv­able apart­ment out­side of Mal­ta and no reg­u­lar stays. Mov­ing to Mal­ta must take place for an unlim­it­ed time. The fac­tors that can trig­ger res­i­den­cy or a sim­i­lar sta­tus out­side of Mal­ta are often­times var­ied. There­fore, it’s impor­tant to be able to exclude that you are res­i­dent based on the respec­tive, applic­a­ble rules. In case of any doubt, ask a local tax advi­sor whether or not a giv­en fact or set of facts can lead to you being qual­i­fied as hav­ing local res­i­den­cy. We can explain the stan­dard inter­na­tion­al prin­ci­ples.

OK, SO I’LL JUST RENT A FLAT IN MALTA AND DE-REGISTER WHERE I LIVE. HOW SHOULD THE FINANCIAL AUTHORITIES THEN BE ABLE TO PROVE THAT I’M STILL THERE?

1. Regard­less of whether or not the local finan­cial author­i­ties find out about it, or whether or not they can prove it, it can still be con­sid­ered tax eva­sion to be resid­ing in anoth­er coun­try and not pay­ing tax­es there.
2. In many coun­tries, the local finan­cial author­i­ties usu­al­ly do not need to prove any­thing. You do. They make a claim, and you need to show the oppo­site.

BUT MY SPOUSE AND THE CHILDREN WON’T NEED TO COME ALONG, WILL THEY?

As a gen­er­al rule, spous­es and chil­dren are con­sid­ered part of the cen­ter of one’s life from a tax per­spec­tive. That means that who­ev­er wants to have one, sin­gle res­i­den­cy in Mal­ta must ful­ly move to Mal­ta WITHOUT ANY INTENT TO RETURN.

OK, SO LET’S SAY I PACK-UP AND MOVE TO MALTA, MAKE A LITTLE MONEY AND COME BACK 2 YEARS LATER

It depends. For exam­ple, if you lived your entire life up until that point in Ger­many, then lived in a for­eign coun­try for two years and then returned to Ger­many, you can expect that the Ger­man author­i­ties will legit­i­mate­ly assume that you left Ger­many with an intent to return, and you may lat­er be taxed in Ger­many for the time when you were gone. If you also have an active con­nec­tion to Ger­many, such as keep­ing a car reg­is­tered there or main­tain­ing an active social life there with reg­u­lar vis­its, you can assume that you might be con­sid­ered “res­i­dent” there for the entire time peri­od.

WELL WHAT CAN I DO THEN?

Regard­less of the oth­er coun­try, you should only be out­side of Mal­ta ‘casu­al­ly’, mean­ing on an irreg­u­lar basis. If you already trav­el a lot either pri­vate­ly or for busi­ness in the nor­mal course of life, you may not need to wor­ry about the points made above.

THIS ALL SOUNDS SO COMPLICATED!

It can be, but it doesn’t need to be because you have us to ana­lyze and struc­ture every­thing for you. There is no for­mu­la or “one-size-fits-all” solu­tion for every­body. What’s per­fect­ly alright for one client may have seri­ous con­se­quences for anoth­er. Each case is dif­fer­ent, and each requires indi­vid­ual expert advice.

IF I MOVE TO MALTA, DO I NEED TO BE PRESENT THERE FOR 183 DAYS A YEAR TO QUALIFY AS A ‘RESIDENT’?

No. You can use Mal­ta as a base from which to oper­ate inter­na­tion­al­ly. All you need in order to be con­sid­ered res­i­dent in Mal­ta are a fur­nished, liv­able apart­ment and the intent to remain in Mal­ta reg­u­lar­ly for an indef­i­nite time peri­od. A per­son is con­sid­ered to have his or her res­i­dence where he or she main­tains an abode. Like in cer­tain oth­er EU juris­dic­tions, a per­son has a place of res­i­dence where he or she has an abode that would allow a rea­son­able per­son to assume that he or she will main­tain or use it. That means that even with­out spend­ing a day in a for­eign coun­try out­side of Mal­ta you could still be con­sid­ered res­i­dent in that coun­try.

SO FOR WHOM DOES MALTA MAKE PERFECT SENSE?

First of all, for any­one who is not tied down and can imag­ine liv­ing in Mal­ta. In our view, it’s par­tic­u­lar­ly favourable for inter­na­tion­al entre­pre­neurs and inter­net-based busi­ness com­pa­ny own­ers who can work (and who do work) from any PC or tele­phone locat­ed any­where in the world.

CAN YOU GIVE ME A TIP THEN?

This is an impor­tant step in life. Take it ful­ly. Live your new life exact­ly the way you are claim­ing to live it.

I SELL ELECTRONIC SERVICES ONLINE TO MY FINAL CLIENTS.…

Then you will prob­a­bly need to reg­is­ter for MOSS and sub­mit MOSS returns togeth­er with your quar­ter­ly VAT returns.

WILL DR. WERNER & PARTNER ALSO TAKE CARE OF MY PERSONAL TAX RETURNS IN MALTA?

Yes.

WILL YOU ADVISE ME HONESTLY EVEN IF MALTA IS NOT FOR ME?

We advise 75% of inquiries not to come to Mal­ta.

CAN I JUST GO AHEAD AND MAKE AN APPOINTMENT?

Yes.

IS DR. WERNER REALLY A GERMAN ATTORNEY IN MALTA?

Yes, Dr. Wern­er is a Ger­man lawyer who is admit­ted in Ger­many and reg­is­tered in Mal­ta to pro­vide legal ser­vices there.

ARE DR. WERNER & PARTNER REALLY LOCATED IN MALTA?

Yes, our law offices are locat­ed in Sliema and cur­rent­ly employ­ee 14 staff mem­bers.

HOW OFTEN ARE TAXES DUE?

As a gen­er­al rule, a hold­ing com­pa­ny must sub­mit its book­keep­ing annu­al­ly where­as an oper­a­tive com­pa­ny is usu­al­ly reg­is­tered for VAT (val­ue-added tax) and there­fore sub­mits tax dec­la­ra­tions on its returns on a quar­ter­ly basis. Our nor­mal book­keep­ing ser­vices include the cur­rent finan­cial account­ing, the quar­ter­ly VAT-dec­la­ra­­tions, the VIES Reports (Recap State­ments) and an eval­u­a­tion of the pri­or Quar­ter.

WHICH BOOKKEEPING AND ACCOUNTING DUTIES ARE THERE?

Each Mal­tese com­pa­ny is oblig­at­ed to main­tain a so-called “audit­ed” account, i.e. to sub­mit an audit­ed bal­ance sheet. Dr. Wern­er & Part­ner are not audi­tors, but we can glad­ly rec­om­mend part­nered audit­ing firms.
Our inter­nal book­keep­ers and accoun­tants can take of your finan­cial and salary book­keep­ing needs on a month­ly or quar­ter­ly basis.

ARE THERE PENALTIES FOR LATE SUBMISSIONS?

Yes, there are penal­ties on both late sub­mis­sions as well as penal­ty inter­est amounts on unpaid tax­es.

IS IT EASIER TO GET A WORK PERMIT IF I FORM A COMPANY?

No.

MY YACHT STILL NEEDS TO BE IMPORTED INTO THE EU.

You can do this with the com­pa­ny that you have already formed which will import the yacht to Mal­ta and pay the full VAT of 18% on its val­ue. The com­pa­ny, how­ev­er, shall be reim­bursed the 18% in the course of the VAT dec­la­ra­tions.

IS IT WORTH IT TO TAKE PART IN THE PROGRAM TO SAVE VAT FOR A YACHT THAT COSTS LESS THAN EUR 1,000,000?

No. That’s only our sub­jec­tive opin­ion, but from a com­mer­cial per­spec­tive it may only make sense to par­tic­i­pate when the val­ue is EUR 1,000,000 or more.

HOW CAN I PROVE THAT THE VAT WAS DULY PAID FOR?

In order to par­tic­i­pate, the com­pa­ny shall receive a cer­tifi­cate from the Mal­tese
VAT Depart­ment con­firm­ing that the yacht was duly taxed. At the con­clu­sion of the pro­gram, the own­er receives a “VAT PAID” cer­tifi­cate.

WHAT DOES IT COST TO PARTICIPATE IN THE VAT PROGRAM?

All togeth­er, it costs ca. EUR 35KEUR 50K over 3 years. We’ll be hap­py to break down the details for you.

DOES MY BUSINESS IDEA REQUIRE LICENCING?

We’ll be hap­py to check with the author­i­ties for you.

HOW LONG WILL IT TAKE UNTIL I RECEIVE A GAMING LICENCE?

At least 12 months. This will strong­ly depend upon what the appli­cant is bring­ing along in terms of tech­nol­o­gy. Most inter­est­ed par­ties seri­ous­ly under­es­ti­mate the time required and relat­ed finan­cial expense.

HOW LONG WILL IT TAKE UNTIL I RECEIVE A FINANCIAL LICENCE?

Depend­ing on the licence, 12–24 months.

WHY DOES IT TAKE SO LONG?

The licens­ing author­i­ty exam­ines every aspect of the appli­ca­tion. This goes as far as ana­lyz­ing indi­vid­ual func­tions even at the link and but­ton lev­el of a web­site. Addi­tion­al­ly, all involved par­ties are checked for crim­i­nal records and debt at the Euro­pean lev­el.

DO DR WERNER & PARTNER GUARANTY RECEIPT OF A LICENCE?

No. Still, we have a 100% suc­cess rate in terms of gain­ing licenc­ing.

HOW LONG IS THE WORK PERMIT GOOD FOR?

Gen­er­al­ly, for one year. After that, it needs to be offi­cial­ly renewed.

DO I NEED A MEDICAL CHECK-UP IN MALTA?

Yes, under cer­tain cir­cum­stances. For appli­cants from coun­tries with a high preva­lence of cer­tain ill­ness­es, such as for exam­ple tuber­cu­lo­sis, med­ical screen­ing by an offi­cial­ly autho­rized doc­tor must take place imme­di­ate­ly after entry.

DO I NEED TO APPLY FOR A SEPARATE RESIDENCY PERMIT?

Yes, but the res­i­den­cy per­mit appli­ca­tion is strict­ly a for­mal­i­ty.

CAN I TRAVEL TO MALTA BEFORE THE WORK PERMIT IS ISSUED?

Yes, with a tourist visa, but we advise against it. On the one hand, the appli­ca­tion process may take longer than the tourist visa’s valid­i­ty. In that case, the appli­cant must leave the Schen­­gen-area for at least 90 days before enter­ing again. On the oth­er hand, for appli­cants already in Mal­ta with their cur­rent visas still show­ing at least 60 days of valid­i­ty, the appli­ca­tion…

HOW LONG DOES IT TAKE TO APPLY FOR A WORK PERMIT?

Usu­al­ly 3 months.

I’M FROM NORWAY OR SWITZERLAND. DO I NEED A WORK PERMIT?

No.

WHO NEEDS A WORK PERMIT?

Gen­er­al­ly, any­one who is not an EU-cit­i­zen and wish­es to work in (and from) Mal­ta.

WHAT DO THE BOOKKKEEPING AND AUDIT SERVICES COST?

All book­keep­ing and account­ing ser­vices are cal­cu­lat­ed accord­ing to the time and effort incurred. As a gen­er­al rule, clients pay between EUR 500 and EUR 750 per quar­ter for con­tin­u­ing book­keep­ing. The audit usu­al­ly costs between EUR 1,200 and EUR 1,500. These amounts are esti­mates based on past prac­tice and there­fore can­not be guar­an­teed.

WILL DR. WERNER & PARTNER ALSO TAKE CARE OF MY PERSONAL TAX RETURNS IN MALTA?

Yes.

I SELL ELECTRONIC SERVICES ONLINE TO MY FINAL CLIENTS.…

Then you will prob­a­bly need to reg­is­ter for MOSS and sub­mit MOSS returns togeth­er with your quar­ter­ly VAT returns.

ARE THERE PENALTIES FOR LATE SUBMISSIONS?

Yes, there are penal­ties on both late sub­mis­sions as well as penal­ty inter­est amounts on unpaid tax­es.

IS IT EASIER TO GET A WORK PERMIT IF I FORM A COMPANY?

No.

HOW OFTEN ARE TAXES DUE?

As a gen­er­al rule, a hold­ing com­pa­ny must sub­mit its book­keep­ing annu­al­ly where­as an oper­a­tive com­pa­ny is usu­al­ly reg­is­tered for VAT (val­ue-added tax) and there­fore sub­mits tax dec­la­ra­tions on its returns on a quar­ter­ly basis. Our nor­mal book­keep­ing ser­vices include the cur­rent finan­cial account­ing, the quar­ter­ly VAT-dec­la­ra­­tions, the VIES Reports (Recap State­ments) and an eval­u­a­tion of the pri­or Quar­ter.

WHICH BOOKKEEPING AND ACCOUNTING DUTIES ARE THERE?

Each Mal­tese com­pa­ny is oblig­at­ed to main­tain a so-called “audit­ed” account, i.e. to sub­mit an audit­ed bal­ance sheet. Dr. Wern­er & Part­ner are not audi­tors, but we can glad­ly rec­om­mend part­nered audit­ing firms.
Our inter­nal book­keep­ers and accoun­tants can take of your finan­cial and salary book­keep­ing needs on a month­ly or quar­ter­ly basis.

WILL YOU ADVISE ME HONESTLY EVEN IF MALTA IS NOT FOR ME?

We advise 75% of inquiries not to come to Mal­ta.

HOW LONG DOES IT TAKE TO MOVE TO MALTA WHEN FORMING A COMPANY?

About 3 months to com­plete every­thing.

CAN I JUST GO AHEAD AND MAKE AN APPOINTMENT?

Yes.

ARE DR. WERNER & PARTNER REALLY LOCATED IN MALTA?

Yes, our law offices are locat­ed in Sliema and cur­rent­ly employ­ee 14 staff mem­bers.

IS DR. WERNER REALLY A GERMAN ATTORNEY IN MALTA?

Yes, Dr. Wern­er is a Ger­man lawyer who is admit­ted in Ger­many and reg­is­tered in Mal­ta to pro­vide legal ser­vices there.

WHEN DOES FORMING A COMPANY IN MALTA MAKE SENSE?

That depends on your par­tic­u­lar case and what you con­sid­er that makes it “worth it”. If you don’t want to move to Mal­ta, it usu­al­ly makes sense where there are annu­al prof­its involved of more than EUR 750K, or if you do want to move to Mal­ta where there are annu­al prof­its of more than EUR 100K.

SO FOR WHOM DOES MALTA MAKE PERFECT SENSE?

First of all, for any­one who is not tied down and can imag­ine liv­ing in Mal­ta. In our view, it’s par­tic­u­lar­ly favourable for inter­na­tion­al entre­pre­neurs and inter­net-based busi­ness com­pa­ny own­ers who can work (and who do work) from any PC or tele­phone locat­ed any­where in the world.

HOW LONG DOES IT TAKE TO FORM A COMPANY?

About 3 months to com­plete every­thing.

WHY IS IT SO EXPENSIVE?

We don’t think it is expen­sive at all. You are not just pay­ing for com­pa­ny for­ma­tion but for an inter­na­tion­al advi­so­ry and con­sult­ing pack­age. A major por­tion of our work actu­al­ly does not involve the actu­al for­ma­tion but pro­vid­ing and apply­ing the full band­width of our know-how in regard to the ever more com­plex inter­na­tion­al tax frame­work to your spe­cif­ic case.

WHAT ISSUBSTANCE IN MALTA“? WHAT DOES IT ACTUALLY MEAN?

For our clients set­ting up a com­pa­ny in Mal­ta, but not actu­al­ly mov­ing to Mal­ta, cre­at­ing “sub­stance in Mal­ta” is the most impor­tant issue. It is by no means enough to sim­ply use the com­pa­ny that we have formed for you in the intend­ed man­ner. You will need a real man­ag­ing direc­tor, a real office and real employ­ees. If you can­not or do not want to do this, then we advise you not to form a com­pa­ny in Mal­ta. If, how­ev­er, you are will­ing to move your pri­ma­ry place of res­i­dence and the cen­ter point of your life to Mal­ta, these require­ments will not apply or will only apply in a very lim­it­ed way.

WHAT DOES THIS COST ANYWAY?

IDR charges set-up costs of EUR 15,000, where­by this depends pri­mar­i­ly on the type of ser­vices.

DO YOU PROVIDE TRUSTEE DIRECTORS AND SHAREHOLDERS?

No.

WHAT IF I SIMPLY DON’T REGISTER THE FORMATION WITH THE TAX AUTHORITIES AND TAKE THE MONEY ALONG EITHER AS CASH OR VIA CREDIT CARDS?

To the extent that you don’t reg­is­ter the Mal­tese for­ma­tion or share­hold­ing, you would be vio­lat­ing the duty to noti­fy and might be sub­ject to a penal­ty of up to EUR 25,000.
You could also become guilty of severe tax eva­sion, and at the very least the auto­mat­ic CRS infor­ma­tion exchange sys­tem would in any event noti­fy the tax author­i­ties in your home coun­try.

IF I LIVE IN GERMANY BUT FORM A COMPANY IN MALTA, WORK WITH IT AND RECEIVE DIVIDENDS THEN I WOULD ONLY NEED TO PAY A 25% SETTLEMENT TAX? TOGETHER, THAT WOULD ONLY AMOUNT TO 30%? THAT’S NOT BAD, RIGHT?

That works only as long as there is still a set­tle­ment tax in Ger­many. A new­ly elect­ed gov­ern­ment, how­ev­er, might still abol­ish the set­tle­ment tax. Still, even if you only pay 25% in Ger­many, the costs involved in cre­at­ing and main­tain­ing tax­able sub­stance in Mal­ta eas­i­ly amount to at least EUR 100,000 p.a. for office space, man­ag­ing direc­tors, employ­ees, etc. That does not apply, how­ev­er, to clients who actu­al­ly move to Mal­ta.

SO I WILL ONLY BE PAYING 5% TAXES, RIGHT?

No. When any share­hold­er of a Mal­tese LTD receives a div­i­dend or a tax rebate, they are still required to pay all of the tax­es due on it in their home coun­try. Always cal­cu­late this as 5% + (95% x tax in home coun­try) to deter­mine the full tax bur­den. If you move to Mal­ta, how­ev­er, there are oppor­tu­ni­ties to sig­nif­i­cant­ly low­er your tax bur­den pur­suant to the effec­tive 5% rate.

ARE TAXES IN MALTA REALLY ONLY 5%?

No. The cor­po­rate tax rate in Mal­ta amounts to 35%. Cer­tain share­hold­ers can, how­ev­er, claim back 30%. The VAT-effec­­tive tax rate there­fore amounts to 5% in Mal­ta.

HOW LONG DOES IT TAKE TO MOVE TO MALTA WHEN FORMING A COMPANY?

About 3 months to com­plete every­thing.

WHEN DOES FORMING A COMPANY IN MALTA MAKE SENSE?

That depends on your par­tic­u­lar case and what you con­sid­er that makes it “worth it”. If you don’t want to move to Mal­ta, it usu­al­ly makes sense where there are annu­al prof­its involved of more than EUR 750K, or if you do want to move to Mal­ta where there are annu­al prof­its of more than EUR 100K.

OK, SO I’LL JUST RENT A FLAT IN MALTA AND DE-REGISTER WHERE I LIVE. HOW SHOULD THE FINANCIAL AUTHORITIES THEN BE ABLE TO PROVE THAT I’M STILL THERE?

1. Regard­less of whether or not the local finan­cial author­i­ties find out about it, or whether or not they can prove it, it can still be con­sid­ered tax eva­sion to be resid­ing in anoth­er coun­try and not pay­ing tax­es there.
2. In many coun­tries, the local finan­cial author­i­ties usu­al­ly do not need to prove any­thing. You do. They make a claim, and you need to show the oppo­site.

SO FOR WHOM DOES MALTA MAKE PERFECT SENSE?

First of all, for any­one who is not tied down and can imag­ine liv­ing in Mal­ta. In our view, it’s par­tic­u­lar­ly favourable for inter­na­tion­al entre­pre­neurs and inter­net-based busi­ness com­pa­ny own­ers who can work (and who do work) from any PC or tele­phone locat­ed any­where in the world.

THIS ALL SOUNDS SO COMPLICATED!

It can be, but it doesn’t need to be because you have us to ana­lyze and struc­ture every­thing for you. There is no for­mu­la or “one-size-fits-all” solu­tion for every­body. What’s per­fect­ly alright for one client may have seri­ous con­se­quences for anoth­er. Each case is dif­fer­ent, and each requires indi­vid­ual expert advice.

OK, SO LET’S SAY I PACK-UP AND MOVE TO MALTA, MAKE A LITTLE MONEY AND COME BACK 2 YEARS LATER

It depends. For exam­ple, if you lived your entire life up until that point in Ger­many, then lived in a for­eign coun­try for two years and then returned to Ger­many, you can expect that the Ger­man author­i­ties will legit­i­mate­ly assume that you left Ger­many with an intent to return, and you may lat­er be taxed in Ger­many for the time when you were gone. If you also have an active con­nec­tion to Ger­many, such as keep­ing a car reg­is­tered there or main­tain­ing an active social life there with reg­u­lar vis­its, you can assume that you might be con­sid­ered “res­i­dent” there for the entire time peri­od.

BUT MY SPOUSE AND THE CHILDREN WON’T NEED TO COME ALONG, WILL THEY?

As a gen­er­al rule, spous­es and chil­dren are con­sid­ered part of the cen­ter of one’s life from a tax per­spec­tive. That means that who­ev­er wants to have one, sin­gle res­i­den­cy in Mal­ta must ful­ly move to Mal­ta WITHOUT ANY INTENT TO RETURN.

THAT SOUNDS EASY. ALL I NEED TO DO IS RENT A FLAT IN MALTA AND I’M SET, RIGHT?

No. You of course should also not have a per­ma­nent res­i­dence or reg­u­lar pres­ence out­side of Mal­ta. Specif­i­cal­ly, and among oth­ers, that means you should not have a liv­able apart­ment out­side of Mal­ta and no reg­u­lar stays. Mov­ing to Mal­ta must take place for an unlim­it­ed time. The fac­tors that can trig­ger res­i­den­cy or a sim­i­lar sta­tus out­side of Mal­ta are often­times var­ied. There­fore, it’s impor­tant to be able to exclude that you are res­i­dent based on the respec­tive, applic­a­ble rules. In case of any doubt, ask a local tax advi­sor whether or not a giv­en fact or set of facts can lead to you being qual­i­fied as hav­ing local res­i­den­cy. We can explain the stan­dard inter­na­tion­al prin­ci­ples.

IF I MOVE TO MALTA, DO I NEED TO BE PRESENT THERE FOR 183 DAYS A YEAR TO QUALIFY AS A ‘RESIDENT’?

No. You can use Mal­ta as a base from which to oper­ate inter­na­tion­al­ly. All you need in order to be con­sid­ered res­i­dent in Mal­ta are a fur­nished, liv­able apart­ment and the intent to remain in Mal­ta reg­u­lar­ly for an indef­i­nite time peri­od. A per­son is con­sid­ered to have his or her res­i­dence where he or she main­tains an abode. Like in cer­tain oth­er EU juris­dic­tions, a per­son has a place of res­i­dence where he or she has an abode that would allow a rea­son­able per­son to assume that he or she will main­tain or use it. That means that even with­out spend­ing a day in a for­eign coun­try out­side of Mal­ta you could still be con­sid­ered res­i­dent in that coun­try.

WHY IS IT SO EXPENSIVE?

We don’t think it is expen­sive at all. You are not just pay­ing for com­pa­ny for­ma­tion but for an inter­na­tion­al advi­so­ry and con­sult­ing pack­age. A major por­tion of our work actu­al­ly does not involve the actu­al for­ma­tion but pro­vid­ing and apply­ing the full band­width of our know-how in regard to the ever more com­plex inter­na­tion­al tax frame­work to your spe­cif­ic case.

WHAT ISSUBSTANCE IN MALTA“? WHAT DOES IT ACTUALLY MEAN?

For our clients set­ting up a com­pa­ny in Mal­ta, but not actu­al­ly mov­ing to Mal­ta, cre­at­ing “sub­stance in Mal­ta” is the most impor­tant issue. It is by no means enough to sim­ply use the com­pa­ny that we have formed for you in the intend­ed man­ner. You will need a real man­ag­ing direc­tor, a real office and real employ­ees. If you can­not or do not want to do this, then we advise you not to form a com­pa­ny in Mal­ta. If, how­ev­er, you are will­ing to move your pri­ma­ry place of res­i­dence and the cen­ter point of your life to Mal­ta, these require­ments will not apply or will only apply in a very lim­it­ed way.

WHAT DOES THIS COST ANYWAY?

IDR charges set-up costs of EUR 15,000, where­by this depends pri­mar­i­ly on the type of ser­vices.

DO YOU PROVIDE TRUSTEE DIRECTORS AND SHAREHOLDERS?

No.

WHAT IF I SIMPLY DON’T REGISTER THE FORMATION WITH THE TAX AUTHORITIES AND TAKE THE MONEY ALONG EITHER AS CASH OR VIA CREDIT CARDS?

To the extent that you don’t reg­is­ter the Mal­tese for­ma­tion or share­hold­ing, you would be vio­lat­ing the duty to noti­fy and might be sub­ject to a penal­ty of up to EUR 25,000.
You could also become guilty of severe tax eva­sion, and at the very least the auto­mat­ic CRS infor­ma­tion exchange sys­tem would in any event noti­fy the tax author­i­ties in your home coun­try.

IF I LIVE IN GERMANY BUT FORM A COMPANY IN MALTA, WORK WITH IT AND RECEIVE DIVIDENDS THEN I WOULD ONLY NEED TO PAY A 25% SETTLEMENT TAX? TOGETHER, THAT WOULD ONLY AMOUNT TO 30%? THAT’S NOT BAD, RIGHT?

That works only as long as there is still a set­tle­ment tax in Ger­many. A new­ly elect­ed gov­ern­ment, how­ev­er, might still abol­ish the set­tle­ment tax. Still, even if you only pay 25% in Ger­many, the costs involved in cre­at­ing and main­tain­ing tax­able sub­stance in Mal­ta eas­i­ly amount to at least EUR 100,000 p.a. for office space, man­ag­ing direc­tors, employ­ees, etc. That does not apply, how­ev­er, to clients who actu­al­ly move to Mal­ta.

SO I WILL ONLY BE PAYING 5% TAXES, RIGHT?

No. When any share­hold­er of a Mal­tese LTD receives a div­i­dend or a tax rebate, they are still required to pay all of the tax­es due on it in their home coun­try. Always cal­cu­late this as 5% + (95% x tax in home coun­try) to deter­mine the full tax bur­den. If you move to Mal­ta, how­ev­er, there are oppor­tu­ni­ties to sig­nif­i­cant­ly low­er your tax bur­den pur­suant to the effec­tive 5% rate.

ARE TAXES IN MALTA REALLY ONLY 5%?

No. The cor­po­rate tax rate in Mal­ta amounts to 35%. Cer­tain share­hold­ers can, how­ev­er, claim back 30%. The VAT-effec­­tive tax rate there­fore amounts to 5% in Mal­ta.

DOES MY BUSINESS IDEA REQUIRE LICENCING?

We’ll be hap­py to check with the author­i­ties for you.

DO DR WERNER & PARTNER GUARANTY RECEIPT OF A LICENCE?

No. Still, we have a 100% suc­cess rate in terms of gain­ing licenc­ing.

WHY DOES IT TAKE SO LONG?

The licens­ing author­i­ty exam­ines every aspect of the appli­ca­tion. This goes as far as ana­lyz­ing indi­vid­ual func­tions even at the link and but­ton lev­el of a web­site. Addi­tion­al­ly, all involved par­ties are checked for crim­i­nal records and debt at the Euro­pean lev­el.

HOW LONG WILL IT TAKE UNTIL I RECEIVE A GAMING LICENCE?

At least 12 months. This will strong­ly depend upon what the appli­cant is bring­ing along in terms of tech­nol­o­gy. Most inter­est­ed par­ties seri­ous­ly under­es­ti­mate the time required and relat­ed finan­cial expense.

HOW LONG WILL IT TAKE UNTIL I RECEIVE A FINANCIAL LICENCE?

Depend­ing on the licence, 12–24 months.

CAN I JUST GO AHEAD AND MAKE AN APPOINTMENT?

Yes.

ARE DR. WERNER & PARTNER REALLY LOCATED IN MALTA?

Yes, our law offices are locat­ed in Sliema and cur­rent­ly employ­ee 14 staff mem­bers.

IS DR. WERNER REALLY A GERMAN ATTORNEY IN MALTA?

Yes, Dr. Wern­er is a Ger­man lawyer who is admit­ted in Ger­many and reg­is­tered in Mal­ta to pro­vide legal ser­vices there.

OK, SO I’LL JUST RENT A FLAT IN MALTA AND DE-REGISTER WHERE I LIVE. HOW SHOULD THE FINANCIAL AUTHORITIES THEN BE ABLE TO PROVE THAT I’M STILL THERE?

1. Regard­less of whether or not the local finan­cial author­i­ties find out about it, or whether or not they can prove it, it can still be con­sid­ered tax eva­sion to be resid­ing in anoth­er coun­try and not pay­ing tax­es there.
2. In many coun­tries, the local finan­cial author­i­ties usu­al­ly do not need to prove any­thing. You do. They make a claim, and you need to show the oppo­site.

SO FOR WHOM DOES MALTA MAKE PERFECT SENSE?

First of all, for any­one who is not tied down and can imag­ine liv­ing in Mal­ta. In our view, it’s par­tic­u­lar­ly favourable for inter­na­tion­al entre­pre­neurs and inter­net-based busi­ness com­pa­ny own­ers who can work (and who do work) from any PC or tele­phone locat­ed any­where in the world.

WHY IS IT SO EXPENSIVE?

We don’t think it is expen­sive at all. You are not just pay­ing for com­pa­ny for­ma­tion but for an inter­na­tion­al advi­so­ry and con­sult­ing pack­age. A major por­tion of our work actu­al­ly does not involve the actu­al for­ma­tion but pro­vid­ing and apply­ing the full band­width of our know-how in regard to the ever more com­plex inter­na­tion­al tax frame­work to your spe­cif­ic case.

WHAT DOES THIS COST ANYWAY?

IDR charges set-up costs of EUR 15,000, where­by this depends pri­mar­i­ly on the type of ser­vices.

DO YOU PROVIDE TRUSTEE DIRECTORS AND SHAREHOLDERS?

No.

WHAT IF I SIMPLY DON’T REGISTER THE FORMATION WITH THE TAX AUTHORITIES AND TAKE THE MONEY ALONG EITHER AS CASH OR VIA CREDIT CARDS?

To the extent that you don’t reg­is­ter the Mal­tese for­ma­tion or share­hold­ing, you would be vio­lat­ing the duty to noti­fy and might be sub­ject to a penal­ty of up to EUR 25,000.
You could also become guilty of severe tax eva­sion, and at the very least the auto­mat­ic CRS infor­ma­tion exchange sys­tem would in any event noti­fy the tax author­i­ties in your home coun­try.

CAN I JUST GO AHEAD AND MAKE AN APPOINTMENT?

Yes.

ARE DR. WERNER & PARTNER REALLY LOCATED IN MALTA?

Yes, our law offices are locat­ed in Sliema and cur­rent­ly employ­ee 14 staff mem­bers.

IS DR. WERNER REALLY A GERMAN ATTORNEY IN MALTA?

Yes, Dr. Wern­er is a Ger­man lawyer who is admit­ted in Ger­many and reg­is­tered in Mal­ta to pro­vide legal ser­vices there.

WHEN DOES FORMING A COMPANY IN MALTA MAKE SENSE?

That depends on your par­tic­u­lar case and what you con­sid­er that makes it “worth it”. If you don’t want to move to Mal­ta, it usu­al­ly makes sense where there are annu­al prof­its involved of more than EUR 750K, or if you do want to move to Mal­ta where there are annu­al prof­its of more than EUR 100K.

CAN YOU GIVE ME A TIP THEN?

This is an impor­tant step in life. Take it ful­ly. Live your new life exact­ly the way you are claim­ing to live it.

OK, SO I’LL JUST RENT A FLAT IN MALTA AND DE-REGISTER WHERE I LIVE. HOW SHOULD THE FINANCIAL AUTHORITIES THEN BE ABLE TO PROVE THAT I’M STILL THERE?

1. Regard­less of whether or not the local finan­cial author­i­ties find out about it, or whether or not they can prove it, it can still be con­sid­ered tax eva­sion to be resid­ing in anoth­er coun­try and not pay­ing tax­es there.
2. In many coun­tries, the local finan­cial author­i­ties usu­al­ly do not need to prove any­thing. You do. They make a claim, and you need to show the oppo­site.

SO FOR WHOM DOES MALTA MAKE PERFECT SENSE?

First of all, for any­one who is not tied down and can imag­ine liv­ing in Mal­ta. In our view, it’s par­tic­u­lar­ly favourable for inter­na­tion­al entre­pre­neurs and inter­net-based busi­ness com­pa­ny own­ers who can work (and who do work) from any PC or tele­phone locat­ed any­where in the world.

THIS ALL SOUNDS SO COMPLICATED!

It can be, but it doesn’t need to be because you have us to ana­lyze and struc­ture every­thing for you. There is no for­mu­la or “one-size-fits-all” solu­tion for every­body. What’s per­fect­ly alright for one client may have seri­ous con­se­quences for anoth­er. Each case is dif­fer­ent, and each requires indi­vid­ual expert advice.

WELL WHAT CAN I DO THEN?

Regard­less of the oth­er coun­try, you should only be out­side of Mal­ta ‘casu­al­ly’, mean­ing on an irreg­u­lar basis. If you already trav­el a lot either pri­vate­ly or for busi­ness in the nor­mal course of life, you may not need to wor­ry about the points made above.

OK, SO LET’S SAY I PACK-UP AND MOVE TO MALTA, MAKE A LITTLE MONEY AND COME BACK 2 YEARS LATER

It depends. For exam­ple, if you lived your entire life up until that point in Ger­many, then lived in a for­eign coun­try for two years and then returned to Ger­many, you can expect that the Ger­man author­i­ties will legit­i­mate­ly assume that you left Ger­many with an intent to return, and you may lat­er be taxed in Ger­many for the time when you were gone. If you also have an active con­nec­tion to Ger­many, such as keep­ing a car reg­is­tered there or main­tain­ing an active social life there with reg­u­lar vis­its, you can assume that you might be con­sid­ered “res­i­dent” there for the entire time peri­od.

BUT MY SPOUSE AND THE CHILDREN WON’T NEED TO COME ALONG, WILL THEY?

As a gen­er­al rule, spous­es and chil­dren are con­sid­ered part of the cen­ter of one’s life from a tax per­spec­tive. That means that who­ev­er wants to have one, sin­gle res­i­den­cy in Mal­ta must ful­ly move to Mal­ta WITHOUT ANY INTENT TO RETURN.

THAT SOUNDS EASY. ALL I NEED TO DO IS RENT A FLAT IN MALTA AND I’M SET, RIGHT?

No. You of course should also not have a per­ma­nent res­i­dence or reg­u­lar pres­ence out­side of Mal­ta. Specif­i­cal­ly, and among oth­ers, that means you should not have a liv­able apart­ment out­side of Mal­ta and no reg­u­lar stays. Mov­ing to Mal­ta must take place for an unlim­it­ed time. The fac­tors that can trig­ger res­i­den­cy or a sim­i­lar sta­tus out­side of Mal­ta are often­times var­ied. There­fore, it’s impor­tant to be able to exclude that you are res­i­dent based on the respec­tive, applic­a­ble rules. In case of any doubt, ask a local tax advi­sor whether or not a giv­en fact or set of facts can lead to you being qual­i­fied as hav­ing local res­i­den­cy. We can explain the stan­dard inter­na­tion­al prin­ci­ples.

IF I MOVE TO MALTA, DO I NEED TO BE PRESENT THERE FOR 183 DAYS A YEAR TO QUALIFY AS A ‘RESIDENT’?

No. You can use Mal­ta as a base from which to oper­ate inter­na­tion­al­ly. All you need in order to be con­sid­ered res­i­dent in Mal­ta are a fur­nished, liv­able apart­ment and the intent to remain in Mal­ta reg­u­lar­ly for an indef­i­nite time peri­od. A per­son is con­sid­ered to have his or her res­i­dence where he or she main­tains an abode. Like in cer­tain oth­er EU juris­dic­tions, a per­son has a place of res­i­dence where he or she has an abode that would allow a rea­son­able per­son to assume that he or she will main­tain or use it. That means that even with­out spend­ing a day in a for­eign coun­try out­side of Mal­ta you could still be con­sid­ered res­i­dent in that coun­try.

WHY IS IT SO EXPENSIVE?

We don’t think it is expen­sive at all. You are not just pay­ing for com­pa­ny for­ma­tion but for an inter­na­tion­al advi­so­ry and con­sult­ing pack­age. A major por­tion of our work actu­al­ly does not involve the actu­al for­ma­tion but pro­vid­ing and apply­ing the full band­width of our know-how in regard to the ever more com­plex inter­na­tion­al tax frame­work to your spe­cif­ic case.

WHAT DOES THIS COST ANYWAY?

IDR charges set-up costs of EUR 15,000, where­by this depends pri­mar­i­ly on the type of ser­vices.

DO YOU PROVIDE TRUSTEE DIRECTORS AND SHAREHOLDERS?

No.

SO I WILL ONLY BE PAYING 5% TAXES, RIGHT?

No. When any share­hold­er of a Mal­tese LTD receives a div­i­dend or a tax rebate, they are still required to pay all of the tax­es due on it in their home coun­try. Always cal­cu­late this as 5% + (95% x tax in home coun­try) to deter­mine the full tax bur­den. If you move to Mal­ta, how­ev­er, there are oppor­tu­ni­ties to sig­nif­i­cant­ly low­er your tax bur­den pur­suant to the effec­tive 5% rate.

HOW CAN I PROVE THAT THE VAT WAS DULY PAID FOR?

In order to par­tic­i­pate, the com­pa­ny shall receive a cer­tifi­cate from the Mal­tese
VAT Depart­ment con­firm­ing that the yacht was duly taxed. At the con­clu­sion of the pro­gram, the own­er receives a “VAT PAID” cer­tifi­cate.

MY YACHT STILL NEEDS TO BE IMPORTED INTO THE EU.

You can do this with the com­pa­ny that you have already formed which will import the yacht to Mal­ta and pay the full VAT of 18% on its val­ue. The com­pa­ny, how­ev­er, shall be reim­bursed the 18% in the course of the VAT dec­la­ra­tions.

THE VAT FOR MY YACHT WAS ALREADY PAID IN FULL IN THE EU.

In that case, it prob­a­ble does not make sense to take part in the VAT pro­gram.

WHAT DOES IT COST TO PARTICIPATE IN THE VAT PROGRAM?

All togeth­er, it costs ca. EUR 35KEUR 50K over 3 years. We’ll be hap­py to break down the details for you.

IS IT WORTH IT TO TAKE PART IN THE PROGRAM TO SAVE VAT FOR A YACHT THAT COSTS LESS THAN EUR 1,000,000?

No. That’s only our sub­jec­tive opin­ion, but from a com­mer­cial per­spec­tive it may only make sense to par­tic­i­pate when the val­ue is EUR 1,000,000 or more.

You did not find what you were looking for?

No prob­lem! Call us on +356 213 777 00 or leave a mes­sage using our con­tact form.
We look for­ward to hear­ing from you!