International Tax Planning in Malta and Double Taxation

International tax planning is a complex minefield to navigate without experience and a deep understanding of the relevant tax laws. However, as leading Maltese Tax Advisers, we have given you information to help you navigate International Tax Planning in Malta.

International Tax Planning Definition

Tax planning includes the analysis of a financial situation from a tax perspective. The purpose of tax planning is to ensure that you’re not only tax-efficient but also compliant. Therefore, by reducing the overall tax liability and ensuring that every action taken is compliant with the law, you’re more productive than ever.

Malta Tax Planning Stratagies for Business and Individuals

Companies setting up, operating, transferring and closing a business have both direct and indirect tax consequences. However, setting up a company in Malta means you benefit from several tax effective systems such as the Full Imputation System and Participating Exemption that allow businesses to plan their taxes more effectively.

In individual’s cases, such as moving country, saving for retirement, selling a business or transfers of an estate also have tax consequences. The use of Trusts and Foundations in Malta as well as the effective use of Malta Holding Companies can make tax planning a lot simpler,easier and more tax effective.

Therefore, to be tax-effective as well as compliant, you must seek qualified advice to navigate this correctly. Contact us today if you would like a free consultation about Malta Tax Planning.

Why plan for International Taxation

International transactions are at risk of attracting double taxation. Consequently, this will make operations more costly and can sometimes limit cross-border trade and other activities. Therefore, it is essential to analyse and prepare for the possible tax consequences and plan the transactions in a manner that will make you as efficient as possible.

Malta Double Taxation Agreement

Also, Malta has an extensive network of Double Taxation Agreements with over 70 countries around the world including; Germany, UK, USA & South Africa. Malta’s Tax Treaties allow for businesses and individuals to be protected from Double Taxation.

Click below to see all the Malta double taxation agreements currently in force:

EU-Malta Double Taxation Agreements & Directives

Malta companies are entitled to the benefits from the European Union Tax Directives (including the Parent-Subsidiary Directive and the Interest & Royalties Directive) in view of Malta’s membership of the EU. The European Union Tax Directives aim to eliminate double taxation on profit distributions between associated companies in the various EU Member States.

Malta adheres to the highest standards concerning transparency and anti-money laundering and financing of terrorism.

Individual International Tax Planning using Malta

Moving to Malta and acquiring Maltese residence, or even Maltese Citizenship, are popular solutions in recent times for those who are looking to be more tax-effective. Malta has become a popular place to visit and to live. This demand is not only due to the tax advantages, but also the mild Mediterranean climate, fascinating history and the blend of English and Italian cultural influences.

Check out our popular blog post on ‘Why Move to Malta’ for interesting facts and insights

Malta can provide sustainable, ethical and compliant opportunities and solutions to individuals looking to be more tax effective. Solutions can include:

Ethical and Sustainable International Tax Planning

The words “ethical” and “sustainable” have been used as a standard to strive for in recent times. The connection with tax planning practices and whether they pass a “fair” or “moral” test in the eyes of the public is a heated debate.

Without going into the details of the broader discussion on these topics, we base all of our activities and solutions on the following principles:

  • Full Disclosure. Plans and solutions that rely on non-disclosure and secrecy are unlikely to meet the legality test. 
  • Follow Facts and Reality. Establishing structures and solutions that don’t follow commercial or individual facts and reality are legally risky.
  • No Abuse of the Law. Loophole-shopping and claiming of incentives which may have been available, if known, will be stopped immediately by a legislative change if deemed legally risky.

Papilio Services Associations

As trusted Maltese Tax Advisors, we aim to provide our clients with the best solutions that will stand the test of time. Through our companies and directors, we are registered with numerous Maltese authorities.

The Malta Financial Services Authority (MFSA) registers us as Company Services Providers. This registration by the MFSA includes the ability to:

  • Receive and hold property under a Trust;
  • Act as Trustees;
  • Act as Administrators of Private Foundations;
  • Provide other Fiduciary Services.

The Maltese Inland Revenue Department designates us as an Authorised Registered Mandatory in connection with the Maltese Tax and Residency Programmes.

Identity Malta licenses Thomas Jacobsen (Managing Director of Papilio Services) as an Accredited Person in connection with the numerous Maltese Residence and Citizenship Programmes.

Papilio Services Limited

Are you are considering setting up in Malta? Papilio Services offer a variety of services for business and individuals from residency programmes, company formation, tax advice and much more. We pride ourselves on client retention and quality service, offering bespoke and tax-efficient solutions for international companies and individuals.

For more information on how we can help you navigate Malta tax and become more tax effective, contact us through email or call us directly +356 2122 7553. We look forward to hearing from you.

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