Starting a Business in Malta – Quick Guide

Malta is recognised as one of the best countries in the Mediterranean to start a business. The country has a great local workforce, a stable economy, and a flexible tax system. However, its main advantage is its location. Malta’s location gives it a great connection to both mainland Europe and North Africa, which makes it a country of choice for many shipping and logistics companies. Let’s take a closer look at the steps you’ll need to take to start a business in Malta.

Self Employed or Limited Liability

The first thing you’ll have to think about when you’re setting up a company is what your business’s structure will be. While you can always go as self-employed, you will open yourself and your assets to legal action. As a limited liability company, you will be better protected as a shareholder, and you will be more respected as well. Note that limited liability companies can be both private or public.

You should know, however, that the incorporation process requires more bureaucratic requirements, like the need to perform an annual audit for instance. You will also need to have at least 2 active shareholders. So, we strongly suggest that you have a viable business plan and speak with experts before you think about incorporating a company in Malta.

Have Your Registration Documentation Ready

If you decide to start a limited company, then you will need to start drafting the articles of association and the memorandum. While this is something that you could do on your own if you have experience, it’s always better to work with a team on the ground who will be able to do it for you. Not only are these documents essential for registration, but they also outline basic rules for the company, directors, and shareholders.

Deposit Share Capital

You or your accountant will then need to determine how much initial share capital will be included in the articles of incorporation and memorandum. The minimum amount required is €1,200. However, note that you only have to deposit 20% of this amount in a Maltese bank.

This also means that you’ll need to open a Maltese bank account to begin with. Tell the teller that you’re there to deposit your share capital. The amount will be deposited into a holding account until the registration process is completed. You will then get a receipt. It is very important to not lose that receipt as it will be essential for registration.

Starting the Business

Next, you will need to take your company registration form, articles of association, memorandum, and share deposit slip and go to the Malta Financial Services Authority. They are responsible for overseeing all companies operating on Malta’s territory. The process should take anywhere from 2 to 3 days and there are fees associated. Make sure that you know what these fees are, as they will vary depending on the size of your business.

Get the Proper Licences

Get the Proper Licences

Everybody who starts a business in Malta will be required to get a trading licence. However, you have to know that some businesses will need some additional licencing. This is the case if you want to start a food business, or a beautician related business for instance. In most cases, all you’ll need is to fill in a commercial activity application form.

Get Your Tax ID Number

While this might not be the most exciting part of starting a business, it’s absolutely essential if you want to be able to start your operation. The good news is that the process is fairly easy. As a matter of fact, you can easily find all documents needed online, and there are no associated fees. However, you will need to file your taxes every year.

Inform the VAT Department

You will also need to register with the VAT department before you can start doing business in Malta. However, there are specific thresholds for VAT that you need to be aware of. If you don’t project to make more than €12,000 per year, then you are not under the obligation to charge VAT. Values will vary if you go over that limit, and will change by increments, so we suggest you speak with an accountant about this.

Register with the ETC and Get a PE

Know that being the owner of a limited company in Malta automatically makes you an employee, so you’ll need to get a PE number. You will also need to register with the Employment and Training Centre, and all of your employees should have individual forms. You will need to register a form every time an employee is hired or leaves the company.

Data Protection Registration

Another thing that is very important but not mandatory for all companies is data protection registration. This will be essential if you’re a company that deals with personal data. These steps have been taken by the Maltese authorities to catch up with the rest of Europe and require that companies have set processes to ensure that their clients’ personal data remains safe at all times.