FAQ’s

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Citizenship

1) Who can apply for Maltese Citizenship?

The candidate must not be less than 18 years old and have a clean criminal record. That applicant is referred to as the primary/principal candidate, after which one can include his family members including their spouse, children and other members.

2) What contributions must the primary candidate make?

The principal applicant has to contribute EUR 650,000 to the National Development and Social Fund. The other individuals included under the application of the main applicant have to make a contribution of EUR 25,000 each.

3) What other conditions have to be satisfied?
  • Candidates must purchase property in Malta with a value of at least EUR 350,000, or rent for no less than EUR 16,000 a year for at least 5 years. Any purchased land can be only be sold after 5 years have elapsed.
  • Investments in Government instruments to the tune of EUR 150,000 must be made and held for at least 5 years.
4) How long does the application process take?
  • Upon submitting the necessary documents, a Maltese residency card is issued within 1 -3 weeks.
  • Identity Malta usually takes 4 months to review application documents.
  • When the conditions described in point 3 are satisfied, together with the possession of a health cover where usually one is given 4 months, one is issued with the Naturalisation certificate.
5) What are the benefits of acquiring Maltese citizenship?
  • Obtaining a Malta passport means that application becomes a citizen of Malta and the European Union.
  • A Malta passport offers freedom of movement across the Schengen agreement, where holders can travel, work, and study without any restrictions
  • Malta boasts a very advanced educational and health system which are free for citizens. However, there are also private schools and hospitals available.

Company Formations

1) What is required to set up a company in Malta?
  • Memorandum & Articles of association: this document contains basic company details such as share capital amount, list of shareholders, list of directors, naming of a company secretary, the company’s main trading activity, the registered address of the company, and the company’s name.
  • In the case of EU nationals, copies of their passports and a recent document showing proof of address (such as a utility bill or a bank statement).
  • In the case of non-EU nationals, the above documents will be needed together with a bank reference and any other documents as may be requested.
  • Copy of the bank slip in which the share capital is deposited.
2) What is the minimum amount of share capital required to incorporate a company?
  • In the case of a private company the minimum amount of share capital required is €1,164.49 and in the case of a public company, the minimum amount of share capital is €46,587.47.
  • In the case of a private company at least 20% of the share capital should be paid up and in the case of a public company at least 25%.
3) What is the amount of directors required in a company?

In the case of a public company the minimum number of directors is 2, and in the case of a private company, the minimum number of directors is 1.

4) Who can be a company secretary?

Subject to certain exceptions, it has to be a natural person; a company cannot act as a company secretary. Every company must have a company secretary.

5) What are the likely costs of setting up a company in Malta?

The registration fee paid depends on the amount of authorised share capital of the company, with a minimum fee of around €245.

6) Can a private company have one shareholder?

Yes, in this case, it is called a private exempt company where the individual can also act as director and company secretary. The company would also benefit from certain exemptions (advantages).

7) How long does it usually take to set up a company in Malta?

Provided that all documents are in order this usually takes about 2-3 days. Once a company is incorporated, a Certificate of Incorporation is issued by the Malta Business Registry.

8) Does the registered address of a Malta registered company have to be in Malta?

Yes, and such service may be provided by a Licensed Corporate Service Provider in Malta.

9) Does the name of shareholders have to be publicly disclosed?

Not necessarily. The names of shareholders can be kept confidential from public access if one opts to have trustees representing them. Licensed Corporate Service Provider can assist in such service.

10) Do I have to open a Maltese Bank Account?

The company is not required to have a local bank account and can have an account with a bank in an alternative jurisdiction. Companies may also open accounts with licensed Electronic Money Institutions.

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Employment

1) What should an employer provide to the employee upon commencement of work?

Employment through a contract requires this document to be signed by both employer and employee. The employer will then provide the employee with a letter of engagement needs to within 8 days from commencement of employment.

2) What is the probation period in Malta?

This is usually taken as six months from the date of commencement unless agreed otherwise between the employer and employee.

3) Can one’s employment be terminated in the probationary period?

Yes, if the length of service is longer than one month, that one week’s notice is given.

4) What is the number of hours in a typical working week?

Usually, the normal hours of work (excluding overtime) are based on 40 hours a week. However, in certain cases as may be established by law, normal hours of work can be more, but not exceeding a maximum of an average of 48 hours a week spread over a reference period of 17 weeks.

5) How many days of leave is one entitled to?
  • If one works 40 hours per week one is entitled to 216 hours of leave a year.
  • If an employee has been employed for less than 12 calendar months, the amount of leave shall be calculated on a pro-rata basis.
  • Leave has to be approved by the employer.
  • If one terminates his employment the amount of leave due can either be used against one’s notice period, or paid to him by the employer, whichever is mutually agreed.
6) What is the amount of sick leave entitlement?
  • This is equivalent to 2 working weeks.
  • One needs to present a doctor’s certificate for sick leave taken for his wage to continue to be paid by the employer.
  • If the amount of days of sick leave exceeds the amount paid by law, one will receive sickness benefits accordingly from Social Security.
7) Is an employee paid on public holidays?

Yes.

8) How many weeks are allowed for maternity leave?

18 weeks. The first 14 weeks are paid by the employer and the other 4 weeks are paid by Social Security.

Malta Funds

1) Why is Malta so attractive for funds?

As an EU Member State, Malta’s funds are registered to other European countries giving them instant access to the EU market. Furthermore, the financial services sector is well regulated and also offers tax advantages, making Malta attractive for funding prospects.

2) Are Malta funds regulated?

Yes, these are regulated by MFSA which is the only regulator for financial services in Malta. The Investment Services Act Chapter 370 of the Laws of Malta controls investment services, collective investments funds and any investment fund having a license in Malta.

3) What type of funds may be established in Malta?

The MFSA Investment Services Rules provide for the below type of funds:

  • Retail funds: including Maltese non-UCITS AND UCITS schemes
  • Non-Retail Funds: including Alternative Investment Funds (AIF) and Professional Investments Funds (PIFs)
4) What are the tax incentives of establishing a fund in Malta?

Funds registered in Malta are not subject to Malta tax.

The benefits include:

  • No income or company tax is imposed on hedge funds having more than 85% of their underlying assets situated outside Malta
  • No tax on the Net Asset Value of the fund;
  • No withholding tax on dividends paid to non-residents;
  • No taxation on capital gains on the sale of units by non-residents;
  • No stamp duty on issues or transfers of units.
5) What forms of funds are available in Malta?
  • An investment company formed by means of the M&A in the form of SICAV or INVCO
  • A commercial partnership formed through a partnership deed
  • A unit trust formed through a trust deed between a management company and a licensed trustee
  • A mutual fund formed by means of a contract
6) How are the assets of a Maltese fund managed?
  • Through an external fund manager
  • A self-managed fund
7) What are the minimum capital requirements for the different funds that exist?

In the case of a self-managed fund, the NAV must not be less than €125,000 for PIFs and €300,000 for AIFs or the equivalent on an ongoing basis.

8) How long does the licensing process usually take?

Usually, 9 to 12 months, provided all information given is in order.

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Property

1) Can foreigners that are visitors or residents make use of medical facilities in Malta and what are the related costs if any?

EU citizens who are either visiting or resident in Malta have access to free public health.

2) What is the procedure to bring pet animals to Malta?

a.   For pet animals entering the Malta from another EU Country

  • An ISO identification – 15 digit microchip, or clearly readable tattoo. The animal must be identified before the rabies vaccination.
  • A rabies vaccine at 12 weeks of age
  • A valid EU passport
  • 21 days have to pass from the date of the rabies vaccination
  • De-worming treatment between 24 hrs to 120 hrs prior entering into Malta (only applies for dogs). Dogs moving directly between Norway, Finland, or Ireland to Malta are exempted from the treatment against the tapeworm Echinococcus multilocularis.
  • The online pre notification needs to be submitted: https://nldmalta.gov.mt/MaltaPetArrivals/​

b.   For pet animals entering Malta from Non-EU Countries

  • An ISO identification – 15 digit microchip, or clearly readable tattoo. The animal must be identified before the rabies vaccination.
  • A rabies vaccine at 12 weeks of age – it will also need a blood test if you are travelling from an ‘unlisted country’. The test must be carried out on a sample collected by an authorised veterinarian at least 30 days after the date of vaccination and not less than three months before the date of movement, the test must measure a level of neutralising antibody to rabies virus in serum equal to or greater than 0,5 IU/ml, the test must be performed in an approved laboratory.
  • An Official Health Certificate issued by the country of departure either ‘listed’ or ‘unlisted country’
  • 21 days have to pass from the date of the rabies vaccination, and 3 months after the rabies neutralizing antibody test if you are travelling from an ‘unlisted country’
  • De-worming treatment between 24 hrs to 120 hrs prior entering into Malta (only applies for dogs).
  • The online pre notification needs to be submitted: https://nldmalta.gov.mt/MaltaPetArrivals/
3) Can residents bring their car to Malta?

Yes, however one has to pay tax on the care depending on its value and age. VAT will be payable as well if one is bringing a car from outside the EU.

4) How can one become a permanent resident?

Both individuals from the EU and non-EU countries may apply for Permanent residency under the Residents Scheme Regulations 2004. The Inland Revenue Department issues a certificate for an indefinite period subject to certain conditions and such certificate will be reviewed annually.

5) What needs to be done to obtain permanent residency in Malta?

A form needs to be completed for both EU and non-EU nationals which can be found at the Police in the Immigration Section. This has to be submitted within 3 months from arrival in Malta.

Tax

1) When should FS3, FS5, and FS7 forms be submitted?

FS3 and FS7 forms are due on the 15th of February of the following year, while FS5 forms must be submitted on the 15th day following month-end.

2) On which type of income does the 15% tax rate apply for a part-time job?

All of the below conditions need to be met:
a) The employment has to be registered with Jobsplus
b) Less than 30 hours a week are worked in relation to such part-time job
c) One does not have a job with the Government
d) If an employee has both a full-time and a part-time job, these must be with different employers
e) The individual is married and his spouse has a full-time employment
If the above conditions are not met in full, that income will be added to the main income and be taxed accordingly. If 15% applies the part-time income must not exceed EUR 10,000 (in the case of a part-time employment) or EUR 12,000 (in the case of a part-time self-employment).. Any amount above this maximum amount should be added to the Main income and be declared in the tax return.

3) How is FSS calculated?

This is calculated through the IRD website providing a spreadsheet for such workings.

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Vat - Typical Questions

1) When should a company register for VAT?

A company should register for VAT within 30 days from its first economic trading activity.

2) Who is eligible to register for VAT?

If a person carries out an economic activity, one has to register for VAT usually under article 10. If turnover does not exceed the established threshold article 11 one may register under this article as exempt.

3) What documents are needed to register a company for a VAT number?
  • A copy of the Memorandum & Articles of Association
  • A copy of the Certificate of Incorporation
  • Passport copy of the Director
4) How often does a VAT Return have to be compiled by a company?

This has to be compiled every 3 months and submitted one month 15 days following the calendar quarter for which the VAT Return is being submitted.

5) What is a recapitulative statement?
  • A recapitulative statement is a declaration of all sales made to EU member states. In such a case, one needs to state the amount of those sales together with the VAT number of the client in that EU member state. This is done for control purposes so that the sales (supplies) in one EU country will be reflected as purchases in the other EU country. And thus, such amounts would match.
6) When should the recapitulative statement be submitted?
  • This is equivalent to 2 working weeks.
  • One needs to present a doctor’s certificate for sick leave taken for his wage to continue to be paid by the employer.
  • If the amount of days of sick leave exceeds the amount paid by law, one will receive sickness benefits accordingly from Social Security.
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