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Open a Private Limited Liability Company in Malta

Open a Private Limited Liability Company in Malta

Most foreign investors coming to Malta will choose the limited liability company as a business form to carry out their activities. This is how this type of company became the most popular type of structure in Malta. There are two types of limited liability companies in Malta, the private limited liability company and the public limited liability one. Our Maltese lawyers can offer information on both types of structures.

 Quick Facts  
Best suited for Small or medium-sized businesses

Minimum share capital

EUR 1,164

Residency requirements to open an LLC (YES/NO)

NO

Minimum shareholders 2
Incorporation time

2 weeks (approx.)

Private exempt company (YES/NO)

YES, under certain conditions. Our attorneys can explain.

Corporate income tax rate

35%

VAT Registration

Mandatory for businesses offering taxable services/supplies.

General required documents for company incorporation

– Articles of Association,

– registered office address,

– information on director/shareholder,

– proof of deposited capital, etc.

Legal framework for LLCs

Companies Act of 1995

Bank account required for shared capital (YES/NO)

YES

Special permits and licenses

Industry-specific (healthcare, hospitality, finance, construction, etc.)

Virtual office possibility (YES/NO)

YES

General steps for opening an LLC

– reserve business name,

– prepare statutory documents,

– register with the Commercial Registrar,

– register for tax purposes, etc.

How can our law firm help?

Our lawyers will guide you through every step of the incorporation process.

What is a private limited liability company in Malta?

The Maltese private limited liability company is known worldwide as the LLC or the LTD. The LLC falls under the regulations of the Commercial Code in Malta and has the following characteristics:

  •  it must have at least 2 shareholders and maximum 50;
  •  the transfer of shares is restricted to the shareholders only;
  •  the company may not trade its shares on stock market.

The private limited liability company can be registered by foreign investors or their representatives who can be professional agents or even a law firm in Malta.

Requirements for a Maltese private limited liability company in 2024

The most important document related to the opening of private limited liability company in Malta is the articles of association which must clearly state the fact that the company is a private one. In order to be deemed a local company, it must have a registered address in Malta and the shareholders must also deposit a minimum share capital of approximately 1,165 euros. It must be fully subscribed upon the registration of the Maltese LLC.

To ensure the management of the private limited liability company in Malta, at least one director and one company secretary are required.  Moreover, the minimum share capital for a private LLC in Malta is approximately EUR 1,165.

Registration of private limited liability companies in Malta

Malta now provides for a reduced period of time for the incorporation of private limited liability companies, however depending on its activities, it must also apply for various licenses or permits before being allowed to operate. The company registration process of a Maltese LLC in 2024 consists in:

  •   company name reservation;
  •   preparation of the statutory documents;
  •   depositing the share capital;
  •   registration with the Commercial Registrar;
  •   obtaining the business license;
  •   registration for VAT;
  •   registration for employment purposes.

A private limited liability company in Malta is a company that restricts the right to transfer shares, prohibits any invitation to the public to subscribe for any shares, and limits the number of members to 50.

A single-member company can be a private limited liability company in Malta, and he/she qualifies as an exempt company. As such, this structure is incorporated with one member only or if it is the case, the membership is reduced to one person after the registration.

Public limited company in Malta vs. the private one

Investors can also choose to open a public limited company in Malta. A public company is a company that does not qualify as a private company. Unlike private companies, public companies have specific regulations and requirements. Our attorneys in Malta will present you with the main features of this type of company.

A public company in Malta can offer its shares or debt certificates (debentures) to the general public. Individuals who are not connected to the company can buy a part of it by purchasing these shares or debentures.

To sell shares or debentures, a firm must officially register as a public company. When it offers shares to the public, it has to provide potential buyers with a prospectus. This is a document that contains important information about the company and the investment, so that interested buyers can make informed decisions.

For a legal entity to become a public limited company in Malta, it must have authorized share capital. This minimum amount is currently EUR 46,587.47. The paid-up share capital, including the 25% required to be paid at the beginning, must be deposited into a bank account in Malta before the company can be registered.

Our law firm in Malta handles incorporating public companies as well.

Taxes for a limited liability company in Malta

Limited liability companies in Malta must comply with their tax obligations. Our Maltese lawyers will present you with the most important taxes applied to this type of company.

The standard corporate income tax rate is 35% and must be paid by limited liability companies on their worldwide income. Maltese companies can claim relief by way of a tax credit for foreign taxes paid on their worldwide income. This credit can be used to offset the applicable Maltese taxes, reducing the overall tax liability.

When a Maltese LLC distributes its taxed profits to its shareholders, they may be entitled to claim a partial tax refund. This can reduce the effective tax rate to 0 – 6.25%, according to each case. The amount of the refund depends on various factors, including the nature of income earned by the company and whether it has claimed relief for foreign taxes paid.

It is also important to note that limited liability companies in Malta must file CIT returns every quarter with the Maltese Inland Revenue Department (IRD). These returns should be submitted within three months after the end of each quarter and include comprehensive information on income, expenses, and profits for the respective period.

In addition to the CIT, limited liability companies in Malta may be subject to other taxes and obligations, depending on their activities and circumstances. Such taxes include VAT (standard rate 18%), social security contributions to their employees, custom duties, or stamp duties. Our Maltese lawyers can explain more about taxes.

Accounting requirement for a public limited liability company

Regardless of the size of the public limited company (PLC), Maltese regulations mandate the appointment of a resident auditor, who is responsible for ensuring compliance with financial reporting requirements. Annually, the company must furnish a comprehensive set of financial statements, comprising a balance sheet, profit and loss statement, and statement of financial position. These documents serve to provide a clear overview of the company’s financial health and performance to stakeholders and regulatory authorities.

Our Maltese accountants play a crucial role in assisting public limited companies (PLCs) in fulfilling their financial obligations. Our skilled accountants ensure compliance with Maltese regulations by providing expert guidance on the appointment of a resident auditor and the preparation of annual financial statements. They meticulously compile essential financial documents, including balance sheets, profit and loss statements, and statements of financial position, adhering to regulatory standards.

Statistics about Maltese companies

If you wish to know more about Maltese LTDs or companies in general, our lawyers in Malta have gathered some interesting statistics about the business industry in 2022:

  • There were a total of 58,386 active businesses that year;
  • The largest sectors among these active business units were: wholesale and retail trade, professional, scientific and technical activities, and construction. Together, these sectors accounted for 41% of all active business units in Malta;
  • 28.6% of those companies were structured as limited liability companies and public limited companies.

We can also assist if you are looking to buy a house in Malta.

For assistance in opening a private limited liability company in 2024, please contact our attorneys in Malta.