Private Limited Liability Company (Ltd)
Kumpanija Privata b'Responsabbiltร Limitata
Company formation in Malta
The Ltd is best suited for: Companies seeking the 5% effective tax rate via the refund mechanism, Online gaming operators applying for an MGA licence, Fintech and crypto businesses (VFA licence), EU holding structures, International trading companies. Malta charges a 35% headline corporate tax rate on company profits. When the company distributes dividends to shareholders, non-resident shareholders can claim a refund of 6/7ths of the Malta tax paid (for trading income), resulting in a net effective tax rate of approximately 5%. For passive interest and royalty income, the refund is 5/7ths (effective rate ~10%). For passive income from a participating holding, 100% refund may apply (effective rate 0%). The refund is paid to the shareholder (not the company), so a proper holding structure โ typically a non-Maltese parent company โ is required. Malta has no withholding tax on outbound dividends, interest, or royalties, and applies the EU Parent-Subsidiary Directive and Interest and Royalties Directive.
- Companies seeking the 5% effective tax rate via the refund mechanism
- Online gaming operators applying for an MGA licence
- Fintech and crypto businesses (VFA licence)
- EU holding structures
- International trading companies
Key Facts
Step-by-Step Formation Process
Verify company name availability
Check that the proposed company name is not already registered or misleadingly similar to an existing entity via the Malta Business Registry (MBR). Submit a name reservation request if desired.
Prepare the Memorandum and Articles of Association
Draft the memorandum of association (setting out the company's objects, authorised and issued share capital, registered office, and subscriber details) and the articles of association (governing internal management, director powers, and share transfer provisions). The memorandum must be signed by at least two subscribers.
Deposit minimum share capital
Deposit the minimum paid-up share capital of โฌ1,165 (20% of the minimum authorised share capital of โฌ46,588) into a bank account in the company's name. Obtain a bank certificate confirming the deposit.
File incorporation documents with the Malta Business Registry
Submit the signed memorandum and articles, bank certificate for share capital deposit, details of directors and company secretary, and registered office address to the MBR. Filing can be done electronically.
Receive Certificate of Registration
The MBR reviews the application and, if compliant, issues a Certificate of Registration confirming the company's legal existence. The company is assigned a registration number.
Register for tax and VAT
Apply for a Tax Identification Number with the Commissioner for Revenue. Register for VAT if turnover exceeds the threshold or if the company is engaged in intra-EU trade. Register for employer obligations if hiring staff.
Open a corporate bank account
Approach a Maltese bank (Bank of Valletta, HSBC Malta, APS Bank) or a licensed fintech provider with the Certificate of Registration, memorandum and articles, director and shareholder identification, and business plan. In-person attendance is typically required for at least one signatory.
Required Documents
- Memorandum of association (signed by at least two subscribers)
- Articles of association
- Bank certificate confirming paid-up share capital deposit
- Details of directors, company secretary, and registered office
- Director and shareholder identification (certified passport copies)
- Director and shareholder proof of address (less than 3 months old)
- Declaration of beneficial ownership
Cost Overview
Tax Treatment
Malta charges a 35% headline corporate tax rate on company profits. When the company distributes dividends to shareholders, non-resident shareholders can claim a refund of 6/7ths of the Malta tax paid (for trading income), resulting in a net effective tax rate of approximately 5%. For passive interest and royalty income, the refund is 5/7ths (effective rate ~10%). For passive income from a participating holding, 100% refund may apply (effective rate 0%). The refund is paid to the shareholder (not the company), so a proper holding structure โ typically a non-Maltese parent company โ is required. Malta has no withholding tax on outbound dividends, interest, or royalties, and applies the EU Parent-Subsidiary Directive and Interest and Royalties Directive.
Pros & Cons
- 5% effective corporate tax rate through the shareholder refund system โ one of the lowest in the EU
- English is an official language โ all legal and business documents can be in English
- EU member state with full single market access and passporting rights
- MGA (Malta Gaming Authority) is the EU's leading online gaming regulatory body
- Strong fintech and crypto regulatory framework (VFA Act)
- Extensive double-tax treaty network covering 76 countries
- No withholding tax on dividends paid to non-resident shareholders
- No thin capitalisation rules
- Minimum two shareholders required (cannot form a single-member private company)
- The 5% effective rate requires a proper holding structure โ it is not automatic
- Refund mechanism adds administrative complexity (pay 35%, claim 30% back)
- FATF grey-listing history (removed in 2022) has left some reputational residue
- Small domestic market โ limited local revenue opportunities
- Banking can be slow, especially for gaming and crypto-related companies
Other Structures in Malta
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Get StartedThis content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.