Company in Malta

Malta is an EU Member State with
an Exceptionally Advantageous Tax Regime

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Malta company formation package: 345 EURO – arrangement of Malta company formation and bank account (via officially licensed local member / partner firms) including VAT and Tax registration. "FBS KOTSOMITIS", operating since 1998, is a well-known and established international professional services network with officially licensed and regulated local member / partner firms. Contact us to start process by sending an email to enquiries@fbsmalta.com, by using our contact form or by calling at +356 2338 1500.

Unilateral and Commonwealth Relief

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Unilateral and Commonwealth Relief - Essential Information and Facts

Unilateral Relief

Relief from double taxation is also possible on a unilateral basis where tax is suffered  outside Malta on income received from a country with which Malta has not concluded a treaty, irrespective of whether or not that income is remitted to Malta.  Any tax suffered outside Malta, would, limitedly to the Malta tax charge on the income, be allowed as a credit against tax chargeable in Malta.

Unilateral Tax Relief operates very much in the same way as treaty relief, except that it only applies outside a restricted tax treaty context.  Unilateral Tax Relief allows relief by allowing, in defined scenarios, relief from foreign tax when such foreign tax includes tax paid in respect of a dividend indirectly.

Unilateral Tax Relief can be applied, insofar that the following conditions are satisfied:

  • It is availed of in respect of income which arises outside Malta;
  • Foreign source income relieved by Unilateral Relief must have been subject to tax, similar in nature to that imposed under the Income Tax Acts under the laws of a territory outside Malta;
  • The individual or body corporate claiming the credit must be resident in Malta;
  • The individual or body corporate claiming Unilateral Tax Relief, must be able to furnish documentary evidence that the income to by relieved by Unilateral Tax Relief suffered tax of a similar character to that imposed in Malta under the Income Tax Act.

Commonwealth Tax Relief

Commonwealth Tax Relief is available in respect of income tax or tax of a similar nature charged under any law in any country of the Commonwealth, if the law of such Commonwealth country has provided for relief in respect of tax charged on income both in that Country and in Malta.

Commonwealth Tax Relief can be applied, insofar that the following conditions are satisfied:

(i) If any person resident in Malta, can furnish documentary evidence, attesting that he/she has suffered Commonwealth income tax in respect of any part of his/her income, he/she shall be relieved from tax in Malta paid on that part of his/her income at a rate, determined as follows-

  • If the Commonwealth rate of tax appropriate to his/her case does not exceed the rate appropriate to his /her case under the Maltese Income Tax Act, the rate at which relief is to be given shall be one-half of the Commonwealth rate of tax;
  • In any other case, the rate at which relief is to be given shall be half the rate of tax appropriate under the Maltese Income Tax Act.

(ii) If any person not resident in Malta who has paid, by deduction or otherwise, or is liable to pay, tax under the Maltese Income Tax Act, tax under the Maltese Income Tax Act for any year of assessment on any part of his/her income, proves that he/she has paid, by deduction or otherwise, or is liable to pay, Commonwealth income tax for that year of assessment in respect of the same part of his/her income, he/she shall be entitled to relief from tax paid or payable by him/her under the Income Tax Act on that part of his/her income at a rate to be determined as follows-

  • If the Commonwealth rate of tax appropriate to his/her case does not exceed the rate appropriate to his/her case under the Maltese Income Tax Act, the rate at which relief is to be given shall be one-half of the Commonwealth rate of tax;
  • If the Commonwealth rate of tax appropriate to his/her case exceeds the rate of tax appropriate to his/her case under the Maltese Income Tax Act, the rate at which relief is to be given shall be equal to the amount by which the rate of tax under the Maltese Income Tax Act, exceeds one-half of the Commonwealth rate of tax.

List of Commonwealth Countries

Antigua and Barbuda Namibia
Australia Nauru
Bahamas New Zealand
Bangladesh Nigeria
Barbados Pakistan
Belize Papau New Guinea
Botswana Rwanda
Brunei Saint Kitts and Nevis
Cameroon Saint Lucia
Canada Saint Vincent and the Grenadines
Cyprus Samoa
Dominica Seychelles
Gambia Sierra Leone
Ghana Singapore
Grenada Solomon Islands
Guyana South Africa
India Sri Lanka
Jamaica Swaziland
Kenya Tanzania
Kiribati Tonga
Lesotho Trinidad and Tobago
Malawi Tuvalu
Malaysia Uganda
Maldives United Kingdom
Malta Vanuatu
Mauritius Zambia
Mozambique

 

Tax Structures can legally mitigate one’s tax liabilities. More information can be provided on request. However, it must be noted that since some of the structures may be technically complex, they are ideally discussed at a meeting with Focus Business Services’ Directors.  For bespoke tax advice, please click here to contact our tax advisors or send us an email on enquiries@fbsmalta.com 

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