Due to the increased effort of companies to relocate business areas or entire companies abroad, as well as the growing willingness of individuals to move their residence or center of life to Malta, the demand for tax expertise for such measures has risen sharply. This is partly due to tax authorities, which conduct standardized audits to prevent the misuse of such international arrangements. Of course, it’s mainly about money and revenue, as every relocation abroad means less tax revenue in the country of departure. Accordingly, laws or interpretations are regularly issued, changed, and adapted over time. This is not only done by national governments but is also driven by economic alliances that proceed relatively harmonized here. Particularly noteworthy are the G20, the OECD, and the EU, which have been more active in the last 5-10 years than ever before and wanted to combat the almost aggressive planning of tax evasion and avoidance, as well as tax evasion itself. As companies use all means and tricks, one should be aware that tax administrations also use their full range of possibilities. Therefore, many measures that might have worked ten years ago are no longer up-to-date today. The tax administrations, legislators, and even the judiciary now penetrate matters much deeper and question much more frequently the sense of structuring through tax-optimized abroad. This tax optimization should not be in the foreground. Likewise, in modern international tax law, it is possible, and possibly even desired, to formulate the right to tax very diversely. Poorly structured, it can therefore be that while part of the profits, as desired and also legally recognized, can be taxed in, for example, Malta, but at the same time, a part can also be taxed in the country of departure, for example, Germany. The value creation principle applies here. Likewise, topics such as exit taxation for individuals as well as companies, transfer prices, treaty shopping, treaty overrides, the application of double taxation agreements, permanent establishment issues, international share swaps, or mergers fall into the category of international taxes/international tax consulting. The establishment of a company or corporate structure is usually the consequence but should never be the reason or origin.
The consulting services on international taxation and international tax law by DW&P Dr. Werner and Partners are aimed at entrepreneurs and companies and at individuals considering an expansion to or through Malta. Our advice is also aimed at individuals who want to move their center of life to Malta. Often these two points are connected and can be extremely useful and effective. It does not always have to be an operational business that wants to include the location of Malta: We at DW&P Dr. Werner and Partner have increasingly created holding structures in recent years, into which dividends or capital gains from abroad flow and work here without taxation or favorably taxed with the earned investment income. In particular, small or new family offices choose Malta as their base of activity. While we, as a firm, do not have a preference for a specific business field regarding our clients, the experience of the last ten years has shown that especially entrepreneurs who include the internet in their activity have chosen Malta as their location. Especially international entrepreneurs and companies for whom English is almost the entrepreneurial mother tongue, the choice of a country where English is an official language is appropriate. This situation has been further reinforced by Brexit. We advise on most questions of international tax law that arise from a setup.
DW&P Dr. Werner and Partner offer every client, before a possible establishment or redesign, a correspondingly well-founded consultation in the international context. Often it may be that the expertise and advice of DW&P alone are not sufficient, and a specialist advisor in the country of departure can or must be involved. In today’s international tax law, it is not important what answers you get, but what questions you ask. An essential part of DW&P’s competence in international tax law is the years of experience that the people and advisors of DW&P Dr. Werner & Partner have. The previously mentioned harmonized efforts of states, communities, and even the measures already implemented now have been understood and penetrated by DW&P Dr. Werner & Partner from the beginning and were already applied in the current form in the advice of DW&P Dr. Werner & Partner before the existence of these efforts. We have always tried and continue to try with success to anticipate or foresee the developments described above. Moreover, from our initiative and logic, we have always supported solid, serious, and real setups. The topics of substance, value creation, transparency, and real economic reasons and benefits played a major role at DW&P Dr. Werner & Partner long before the Panama Papers. Therefore, we can point out that for most clients, not much has changed after the significant changes that states and communities enacted following the publication of the Panama Papers and similar documents, because they were already set up accordingly beforehand. One of our core competencies also lies in understanding the political motivation of the states, as well as their tax protection measures, to prevent a shell company from unlawfully reducing the tax revenue.
DW&P Dr. Werner & Partners always pays attention to a comprehensive view. This is absolutely essential nowadays, as one is forced to look beyond the (international) horizon. Our expertise in the field of international tax law lies in advising companies and individuals who want to relocate a business and/or center of life to Malta. Noteworthy in this regard are:
The advantage of DW&P Dr. Werner & Partner’s advice in the context of international tax is the internationality of the team. This has a direct effect on all German-speaking clients because the core competence and services of the department are primarily provided by German-speaking consultants who, of course, also have the necessary Maltese qualifications. Thus, a real and unique advantage is that German-speaking clients can be advised in German on a Maltese matter. This includes not only advice but also understanding the mentality and understanding the law in Germany or Austria. This is not only technically important but also essential to understand the motivation of German-speaking countries. For all non-German-speaking clients, however, it also has a decisive advantage: Since Germany and German tax law have been leading and pioneering for all changes in international tax law in the last ten years, one can generally assume that if one works in compliance with German tax law, most other countries will also comply. It should be mentioned here that Germany is the country where the fewest adjustments had to be made in local law to comply with international law. Various mechanisms or legal bases, which are valid for many countries only from 2019, 2020, or 2021, have been in existence in German tax law for decades. This is also one reason why our clients did not have to change or restructure much after the EU or OECD made or initiated corrections. Accordingly, DW&P Dr. Werner and Partner incorporate this German experience into every structuring. This may seem strict and also more complex or elaborate than some clients might like, but it is precisely what makes the main advantage of our service.
In 75% of inquiries, we advise against Malta.
That always depends on the individual case and, above all, on the personal perception of ‘worthwhile’. If you do not move to Malta, it is worthwhile from a profit of EUR 750,000 upwards, and if you move to Malta from a profit of EUR 100,000.
Whether the tax office notices it or can prove it or not does not matter to the fact that it can still be tax evasion if you reside in Germany and do not declare taxes. The tax office does not have to prove anything, but you do. The tax office assumes and you have to prove otherwise.
First of all, for anyone who is unattached and can imagine living in Malta. In our opinion, the arrangement is best suited for internet entrepreneurs or international entrepreneurs who can and do work from any phone or PC in the world.
That may also be the case, but to analyze and structure it you have us. There is no one-size-fits-all scheme or formula. What is completely acceptable for one client can have fatal consequences for another. Each case is different and each case needs individual advice.
Comprehensive tax planning advice for businesses and individuals.
Advice on taxation when relocating businesses and individuals.
Application and optimization of double taxation agreements.
Support in establishing substance in Malta and reducing it abroad.
Establishment and management of holding structures for tax optimization.
Avoidance of treaty shopping and handling of treaty overrides.
Strategic planning and advice on relocation before an exit.
Access to a broad network of international tax experts.
Audit Director
Nathaniel Borg
Accounting Director
Roderick Galea
Senior New Business Manager
Horst Wickinghoff
Always free of charge.
DW&P Dr. Werner & Partners. One of leading tax & law firms in Malta.
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Corporate Services at DW&P Dr. Werner & Partners are provided by DW&P Services Ltd. (C 103208) which is regulated by the MFSA and is licensed under Authorised Person ID: DSER-23577 to carry out the activities of a Class C CSP in terms of the Company Services Providers Act (Cap. 529 of the Laws of Malta).
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