Registering a Business in Malta: A Guide for UK Entrepreneurs

If you’re a UK entrepreneur seeking to expand your business ventures or establish a new enterprise, Malta presents an attractive opportunity. With its strategic location, favourable tax regime, and pro-business environment, Malta has become a popular choice for business owners, entrepreneurs, and investors alike.

Let’s explore a few key reasons setting up a business in Malta is a worthwhile endeavour, as well as a guide through the steps of doing so!

Why Set Up a Business in Malta?

From corporate-friendly tax policies to being a beautiful and safe country with low crime rates, there are plenty of reasons that businesses choose to set up shop in Malta.

Favourable Tax Regime

Malta offers a highly advantageous corporate tax system, making it a compelling destination for businesses. The country operates a unique imputation system, where business owners can benefit from a refundable tax credit and effectively reduces their tax rate. Additionally, Malta has an extensive network of double taxation treaties with over 70 countries, including the UK, ensuring that businesses can avoid or minimise double taxation.

European Union Membership

As a member of the European Union (EU) since 2004, Malta provides businesses with access to the EU Single Market. This advantageous position makes Malta an excellent gateway for UK entrepreneurs and business owners who are looking to establish a presence within the EU, even after the UK departed from the union. It is also a great option for businesses who are facing new uncertainty after being forced to pull out of the European business landscape post-Brexit.

Addressing Rising Costs

The cost of doing business in the UK has been on the rise in recent years, due to the cost of living crisis and effects of the pandemic. High rents as well as increasing labour and energy costs can place significant financial strain on businesses, particularly startups and SMEs. In contrast, Malta provides a more affordable environment for businesses to operate. The cost of living in Malta is generally lower than in many parts of the UK, resulting in reduced expenses for employee salaries and benefits. Furthermore, Malta’s competitive tax rates contribute to cost savings for businesses.

Bridging Talent Gaps

80% of UK businesses struggle to find the right talent to fill positions, marking a 17-year high of labour shortages. Malta, however, offers an attractive pool of skilled professionals across various sectors. In addition to the local talent pool, the EU free movement allows businesses in Malta to tap into a broader talent market from other EU member states.

Minimal Language Barrier

English is one of the official languages of Malta and this linguistic advantage makes it easier for British business owners to communicate and conduct business activities in Malta, whether that is comfortably interacting with local stakeholders, employees, and clients, or handling official business documents and regulatory compliance.

Steps to Set Up a Business in Malta

1. Determine the Business Structure

The first step is to decide on the legal structure of your business. Malta offers several options, including a public or private limited liability company, a sole proprietorship, a general partnership, or a branch of an overseas company. Each structure has its own advantages and requirements, so it’s crucial to seek advice to choose the most suitable option based on your business.

2. Reserve a Company Name

Once you have decided on the business structure, you need to reserve a unique name for your company. The name should not be identical to existing companies registered in Malta or contain any potentially offensive words. The company name should also properly represent the company’s nature. For example, you may need to show evidence to be allowed to use certain words in your business such as “insurance” or “bank”.

3. Register the Company

To register your business, you need to submit the necessary documentation, including the memorandum and articles of association, details of directors and shareholders, the registered office address, the amount of share capital, as well as other important information. Once all the documents are in order and submitted, businesses should then obtain a Certificate of Registration, which then authorises them to conduct business in Malta.

4. Obtain Necessary Licences

Depending on your business activity, you may need specific licences or permits to operate legally in Malta. Certain sectors, such as financial services, gaming, and pharmaceuticals, have additional regulatory requirements. Businesses should engage legal and professional services to ensure compliance with all applicable regulations, depending on their industry and business needs.

5. Set Up Accounting and Taxation

Once the company has been registered, you will need to set up your company’s accounting system and ensure compliance with Maltese accounting and tax regulations. This includes registering the company for income tax and VAT purposes. Malta operates on a self-assessment basis, and companies are required to submit annual financial statements and tax returns.

6. Open a Bank Account

Once your company is registered, you will need to open a business bank account in Malta. Choose a reputable bank that offers services suitable for your business needs. You will typically require the company’s registration documents, proof of identity for directors and shareholders, and proof of the company’s address.

Register Your Business in Malta With The Help of Papilio Services

Setting up a business in Malta offers UK entrepreneurs an array of benefits, including a favourable tax regime and EU membership. While the process may be complicated, by following the steps outlined in this guide, you can navigate the process effectively.

However, it is important to consult legal and professional experts who specialise in Maltese company law and taxation to ensure compliance with all regulations and maximise the opportunities available. With proper planning and execution, Malta can provide an excellent foundation for your business expansion and access to new markets within the EU and beyond.

Papilio Services has years of experience helping all types of companies with their Malta company formation and registration needs. From ensuring all your documents are in order for registration to carrying out services related to Malta trusts and foundations, we can assist your business throughout the entire registration process and the business’s lifetime.

If this interests you, contact us for a free consultation today!