Is A Malta Limited Still Legal in 2018?

2017 was undoubt­ed­ly a tur­bu­lent year for the whole “tax world”, and not just for us in the law office of Dr. Wern­er and Part­ner. At the begin­ning of the year the Pana­ma Papers (and now in Octo­ber the Par­adise Papers) were set free; leaked. The results of both instances are rough­ly com­pa­ra­ble.

There area num­ber of off­shore com­pa­nies; In the past many peo­ple have tak­en advan­tage of them. The goal has always been the same: to save tax­es. Or to avoid tax­es alto­geth­er.

Is such a tax practice in 2018 still legitimate?

Focus has always been on off­shore com­pa­nies, essen­tial­ly com­pa­nies that can not demon­strate a real oper­a­tion in the coun­try of their head­quar­ters and only serve to bill. Prof­its are thus post­poned and the tax bur­den rad­i­cal­ly reduced. How­ev­er, it must be made clear that such an approach is no longer pos­si­ble through the OECD’s BEPS ini­tia­tive. The tax author­i­ties exchange all infor­ma­tion, there­by ren­der­ing relo­ca­tion of prof­its impos­si­ble. Tax evaders, who in the past have remained unno­ticed in evad­ing mil­lions in tax­es, can no longer shift prof­its anony­mous­ly. Moral­ly, this is a step up.

The model of Malta Limited in 2018

If you decide to start a com­pa­ny in Mal­ta (- Mal­ta Lim­it­ed), you must pay a lot of atten­tion to the fin­er details of oper­a­tion. A com­pa­ny foun­da­tion is sort­ed quick­ly. We in the office of Dr. Wern­er & Part­ner are in close con­tact with the author­i­ties who enable this, but sim­ply start­ing up the com­pa­ny is obvi­ous­ly not enough. Rather, this is the moment our work real­ly begins. We do not imple­ment let­ter­box com­pa­nies. Sim­ply put, they ille­gal and inef­fi­cient in the long run. There­fore, an active busi­ness oper­a­tion must be demon­strat­ed in Mal­ta. This means using an office, hir­ing employ­ees and plac­ing a man­ag­ing direc­tor on site. Spe­cial atten­tion is also paid to the activ­i­ties of the com­pa­ny abroad. You have to be par­tic­u­lar here. As soon as a per­son has pow­er of attor­ney or account access abroad, for exam­ple in Ger­many, this can trig­ger a per­ma­nent estab­lish­ment and thus a tax lia­bil­i­ty in Ger­many.

Conclusion of ‘Malta Limited 2018’

It is cer­tain­ly still pos­si­ble to save tax­es here with a Mal­ta Lim­it­ed in 2018 . How­ev­er, this must be imple­ment­ed ear­ly on and care­ful­ly planned. Only those who com­ply with all legal­i­ties, leav­ing the tax author­i­ties no room for inter­pre­ta­tion in case of doubt, can legal­ly oper­ate a com­pa­ny in Mal­ta. We at Dr. Wern­er and Part­ner are hap­py to inform you about the details of such imple­men­ta­tions.

About Philipp Sauerborn

In 2005, Philipp Sauer­born joined the firm of St. Matthew in Lon­don, one of the lead­ing Ger­man account­ing firms in Eng­land renowned for its exper­tise in cor­po­rate, com­mer­cial and tax law, as a depart­ment head. After three years, he was a part­ner and man­ag­ing direc­tor.
Towards the end of 2011, he decid­ed to move to Mal­ta, where he first worked at inter­na­tion­al law firms and con­sul­tan­cies in an employed and con­sult­ing capac­i­ty. Since the begin­ning of 2013, he has been a senior employ­ee at Dr. Wern­er & Part­ner. Mr. Sauer­born is cur­rent­ly com­plet­ing his ADIT ‑Advanced Diplo­ma in Inter­na­tion­al Tax.

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