Corporate Tax Benefits: Company Scenarios

Malta Intellectual Property (IP) Company

Maltese IP companies deriving royalty income are subject to numerous tax benefits. Firstly, if the royalty income in question is of an active nature (derived directly or indirectly from trade) this would be subject to an effective corporate tax rate of only 5%. On the other hand, if the royalty income is of a passive nature (not derived directly or indirectly from trade) this would be subject to an effective corporate tax rate ranging between 0% and 10%.

Malta Gaming Company

Besides experiencing an effective corporate tax rate of only 5% (the lowest in Europe), Maltese iGaming and iBetting companies also enjoy very low gaming taxes and license fees. International statistics continuously show that Malta remains the number one iGaming jurisdiction in Europe. Such status was only possible because Malta ensures to offer the right blend between low cost incentives and guaranteeing high EU standard recognition at the same time.

Malta Shipping Company

The use of Maltese shipping companies for flagging or re-flagging ships or yachts is subject to considerable fiscal and non-fiscal benefits. 
In addition to enjoying a 100% exemption from Income Tax on the resultant profits, qualifying companies owning or operating (including under bare boat charter) Maltese flagged vessels may also enjoy the following:

  • no restrictions or taxation on the sale or transfer of shares of a company owning Maltese registered ships
  • no restrictions or taxation on the sale and mortgaging of Maltese registered ships
  • whereas in the case of commercial ships and yachts an overall VAT exemption will apply, in the case of pleasure yachts, a scheme is in place that allows the effective VAT rate to be reduced considerably

Malta Aviation Company

Recently the Government of Malta has undertaken a revamp in Aviation Law. Among the various fiscal incentives available in this sector one can find that:

  • income derived by non-Maltese resident operators from the ownership, leasing or operation of aircrafts or aircraft engines used in international aviation business, such as transport of passengers or goods, will not be taxed in Malta unless such income is actually received in a Maltese bank account. This will apply despite the fact that the aircraft may be registered and/or is operated in/from Malta
  • should any Maltese tax be incurred, eventually should any tax be due in Malta, this may be lowered to an effective tax rate of 5%, vià our tax refund system
  • Malta offers a considerable cash flow advantage by manifesting accelerated tax depreciation rates for the aviation sector (6 years for the aircraft and engines and 4 years for interiors)

Malta Trading Company

The corporate income tax rate for a trading company incorporated in Malta is 35%. However, the effective tax rate incurred by a registered foreign shareholder could be lowered significantly if a refund is claimed upon the distribution of dividends (or bonus shares) by such company.

 Also, Malta has recently introduced the possibility of income tax consolidation, whereby a parent company, together with its subsidiary/ies may elect to join together and form a single fiscal unit. Should the standard criteria for the formation of a fiscal unity be met, numerous benefits shall follow, a couple of the main include: 

  1. The filing of a single tax return for fiscal unit; and
  2. A cash flow advantage in respect to the operation of the partial shareholder tax refunds.’


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