The transfer of marketable securities, such as shares in Maltese companies, is generally subject to a stamp duty of 2% of their ‘real value’, as outlined in the Duty on Documents and Transfers Act. This rate increases to 5% for companies whose primary assets consist of immovable property located in Malta.
For another year, Malta has extended the concession for reduced stamp duty, decreasing the rate from 5% to 1.5% for inter vivos transfers of family businesses to succeeding generations. This continued incentive is designed to support family enterprises as they seek to benefit from this favourable rate within their succession planning strategies.
The reduced rate specifically applies to donations of shares from parents to their children, or, if there are no children, to the children of their siblings.
These benefits are only available for transfers made by way of donation, provided that the required notice is submitted to the Commissioner for Revenue using the prescribed form or method, by 31 December 2025, under the Duty on Documents and Transfers Act and its related rules.
To Sum Up
Family-owned enterprises in Malta face various challenges pertaining to governance, succession planning, strategic focus, family dynamics, market conditions, and decision-making processes. Furthermore, the aforementioned donation process presents a valuable opportunity for these families to assess and, if necessary, revise the company’s documentation to facilitate a seamless transition. It is essential to address these challenges to ensure the long-term success and sustainability of family businesses within the country. The intricacies involved in managing a succession process with due diligence cannot be overlooked. Families contemplating a revaluation of their internal ownership, governance, and organisational structures are recommended to seek professional guidance at an early stage from reputable experts. Should you wish to arrange an initial consultation to discuss your circumstances and determine how our private client services may support you, please do not hesitate to contact us.
