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Maltese tax-efficient


serving your Foreign Company

An ideal use for the Maltese International Trading Company is to set up an operation in Malta to provide foreign entities and corporations with back office administration and support services.  In fact, most management operations and administrative tasks can be out-sourced to a Maltese ITC so as to qualify as a back office activity for purposes of Maltese law.

This means that the profits of Maltese “Back Office ITCs” performing “routine administration services” in Malta can enjoy a flat rate of 4.17% tax rather than the normal corporate rate of 35% (see Taxation of ITCs).

1. Benefits

2. Qualifying Activities

3. Ownership & Directors

4. Conditions

1. Benefits

  • Low rate of tax for back-office ITCs

  • An extensive range of double taxation agreements which supports effective tax planning.

  • Training grants for approved programs are offered to employees and management.

  • Factory and office space is available at low rental costs.

Malta is in a good position to encourage local set-ups of this nature because of a well-educated workforce and its high number of professionally qualified and trained personnel.

2. Qualifying Activities

There are no restrictions as to the type or nature of the back office services that may be accepted for the purposes of this tax benefit. Thus services in support of companies engaged in airlines, hotel or hospitality industry, or administrative tasks in support of trust services, shipping and maritime trade, insurance or fund administration business qualify for this purpose.

3. Ownership & Directors

There are no restrictions on ownership, thus the back office operation may be owned by local or foreign interests, or by both jointly. Neither are there any restrictions regarding the beneficiaries or recipients of the services who may consist of one or more undertakings involved in different activities and ownership structure.

There are no restrictions to the company having foreign directors.

4. Conditions

the services must be provided to foreign residents or entities;

the services must amount to routine administrative, accounting or other support services or management functions, and do not comprise services which are subject to specific regulatory licensing or control, (e.g. the duties of a professional lawyer, or trustee, or a fund manager, or an auditor) but may represent the administration needs of such categories of licensable persons;

the services must be provided either by a local company or by a local branch of a foreign established company.

the minimum paid up capital of this company: Lm5,000 (12,000USD).

Back Office Services for your International Trading/Holding Companies

International Trading Companies

See also:

Double taxation treaties

Holding Companies

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