Tax Management

It is elementary to imagine the cross fertilisation of services we regularly apply across our entire spectrum.

A client company requiring venture capital, for example, may be assisted with the location and successful negotiation of the appropriate funding at the desired terms. The picture completes itself thoroughly if the financing is structured such as to provide additional benefits to investor and investee through the creation of Malta based international corporate vehicles - in short, the funding required plus a tax benefit for both parties.

The structure does indeed apply to the entire spectrum of financing services: a sports club requiring accelerated cash flow would, for example, channel television rights, royalties and so on in the same manner.

This additional service truly reflects what we mean by Total Solutions for Business at Credinvest International - we serve our clients and provide solutions to their requirements, but subsequently go further by creating tax friendly structures - within which to place those solutions - to give true and substantial value to each and every deal.

In addition to a significantly beneficial fiscal regime for companies doing business internationally, Malta holds double taxation treaties with no less than 25 countries around the world.

Malta based operations are conducted through an International Trading Company, indeed a normal private limited liability company. However, the company qualifies as an International Trading Company under the Income Tax Act if the company is engaged solely in trading activities from Malta but not in Malta with persons outside Malta who are not resident in Malta, and if the company has expressly limited its objects to such trading activities as well as to such acts and activities as are necessary for the conduct of its operations from Malta.

The special fiscal treatment accorded to shareholders is the main advantage of an International Trading Company. Though this type of company is liable for taxes at the normal rate of 35% on its worldwide income, certain fiscal benefits for non resident shareholders result in an effective tax rate to them of about 4.2%.

One can fully benefit from this favourable tax treatment by making use of Malta's extensive arrangements for relief from double taxation. Apart from the relief arising under Malta's increasing network of double tax treaties or under the Commonwealth relief, Maltese companies can avail themselves of unilateral relief for tax paid on income arising outside of Malta.

In addition to the organisation and management of international trading companies, our firm also establishes and administers trusts for the purposes of wealth conservation, management and succession. Trusts registered in Malta benefit from advantageous conditions including asset transfers free from taxes, no succession duties and a fixed fee of USD 600 per annum on the income of the trust.

In terms of the tax management, our firm identifies those structures, be they Malta based or otherwise, most appropriate to our clients' existing business model and anticipated future requirements. To this end, working with associated practitioners throughout Europe, we tailor solutions for clients in accordance with the most appropriate jurisdiction.

Credinvest House
157, Archbishop Street
Valletta, VLT07
Malta, Europe

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