Are you thinking about establishing a new company in Malta or growing your current one?
Malta offers businesses a welcoming atmosphere due to its advantageous location in the Mediterranean. Malta’s low social security obligations and affordable labor expenses are further factors that draw investors to establish a business there.
But, before registering a company in Malta, a business owner must select the sort of Maltese company that best suits their needs. Entrepreneurs should first be familiar with the sorts of corporations that are accessible in Malta before deciding on a business structure. A private limited company, a branch office, and other business entities can all be established in Malta.
This article will cover the numerous types of companies in Malta.
Numerous Types of Companies in Malta
For incorporating a firm in Malta, it is crucial to be aware of the kinds of businesses available in Malta. There are several different kinds of businesses operating in Malta, each with specific characteristics and regulatory needs.
The several businesses that may be formed in Malta are listed below:
1. Limited Liability Company
One of the most popular types of businesses in Malta is a limited liability company. An LLC in Malta could be classified as either a public or private enterprise.
Private Limited Company (Ltd)
Investors in Malta usually establish private limited corporations, which end in “Limited” or “Ltd.” Typically, this kind of business in Malta includes no less than 2 stockholders and does not include more than 50 stockholders. In the case of such types of businesses in Malta, the stockholder’s obligation is capped at the amount of their share capital investment. An Ltd firm is required to possess a paid-up share capital of 1,164 euros, from which almost 20% have to be fully paid up when the firm is established.
Benefits of an Ltd in Malta
- The maximum value for which the stockholders are liable is the sum they invested in the business.
- On the creation of a corporation or the issuance of stocks, there isn’t any stamp duty or capital duty.
Public Limited Company (PLC)
A public limited corporation is one of the types of companies in Malta, whose stocks as well as debentures can be issued to the general public to increase capital. Shares of a PLC may be openly exchanged or sold in the share market without being subject to any constraints that apply to Ltd. The names of such kinds of companies in Malta must conclude with the acronym “PLC”. At least two stockholders are required to form a PLC. A PLC must possess a minimum share capital of 46,587.47 euros, with almost 25% of that amount to be entirely paid up at the time of establishment.
Benefits of a PLC
- A PLC in Malta may acquire funds by offering stocks to the general public.
- Stockholders of such businesses in Malta can readily and easily purchase and trade stocks.
- Shares in a PLC that is traded on a stock market can readily have their value checked.
2. Partnership Firm
A partnership is an official agreement between two or more parties to run a firm and split its earnings. In Malta, forming a partnership is very easy because all that is required is for the partnership contract to be written and notarized. Such types of companies in Malta have a distinct legal identity from that of their participants. The Companies Act in Malta permits the creation of 2 kinds of partnership firms which are referred to as limited and general partnerships. The partners’ obligation is the main distinction between both kinds of partnerships.
General Partnership (En Nom Collectif)
The responsibility of a partner in a general partnership enterprise is limitless. As such, the duties and responsibilities associated with the partnership are shared equally and collectively by each member. A general partnership is formed when there are a minimum of two parties involved, who may be people or businesses. Such types of companies in Malta are transparent for taxation reasons. Therefore, rather than being taxed separately as a distinct legal organization, members of a general partnership disclose their respective profits in their individual tax filings. Hence, tax is owed in accordance with the individual tax rates that are in effect.
Benefits of En Nom Collectif in Malta
- In a general partnership, each partner contributes to the liabilities, expenses, and duties of managing the enterprise.
- The revenues and expenses are split between the partners and are subject to individual taxable income.
- Are not required to have a minimum capital requirement.
Limited Partnership (En Commandite)
In a limited partnership, there are 2 distinct sorts of partners: general and limited. The general partners will be responsible for overseeing the corporation’s operation and will be severally as well as financially accountable for the obligations of the partnership with their personal belongings. The limited partner’s accountability to the firm’s obligation is capped to the degree of their capital contributions. The partnership deed for such forms of businesses in Malta must clearly specify who the general, as well as the limited partners, are.
Benefits of En Commandite in Malta
- The amount of the limited partner’s invested capital determines how much of the firm’s obligations they are responsible for.
- Doesn’t have any minimum capital requirement.
3. Sole Proprietorship
A sole proprietorship is one of the easiest types of companies in Malta and is chosen by independent business owners. When it comes to registration requirements, the sole proprietorship has the fewest requirements before starting up a company. In the case of a sole proprietorship, the proprietor will be solely accountable for all the debts and obligations of the enterprise. One of the advantages of starting a sole proprietorship in Malta is that all revenues are distributed to the person who founded the company.
Benefits of Sole Proprietorship in Malta
- Simple and affordable to establish.
- The proprietor has exclusive authority over the firm.
- Less expensive startup and operating expenses.
4. Branch Office
A branch office is an expansion of a parent corporation with headquarters located in a different nation. A branch of an overseas corporation works under the exact name and engages in similar operations as its holding firm. One of the requirements for branch registration involves the selection of a local representative residing in Malta. One of the perks of establishing a branch in Malta is its lack of enrollment fees. An international firm that conducts operations in Malta via a branch is obliged to incorporate that branch with the local registrar of companies and set up a registered office address there.
Benefits of a Branch Office in Malta
- Branch offices are subject to taxation on revenues made in Malta.
- No minimum capital is necessary.
- Lower registration expenses.
Conclusion
When incorporating a company in Malta, being aware of the corporate structures available can help you select the one that is ideal for your business operations. Malta provides entrepreneurs with a variety of business structures, each with unique benefits.
Contact our specialists at Odint Consulting if you want advice on how to set up a business in Malta and want to know what corporate structure is best for you. You can choose the structure that is best for your company’s performance with the assistance of our specialists.
FAQ’s
There are different kinds of firms in Malta, such as:
- Limited Liability Company
- Partnership Firm
- Sole Proprietorship
- Branch Office
- In Malta, PLC names must end with the letters “PLC,” whereas Ltd enterprises must end with “Limited” or “Ltd.”
- In Malta, an Ltd must have at least €1,165 in the capital, and a PLC must have at least €46,587.47.
Among the most common business structures in Malta is the limited liability corporation.
Malta’s advantages of a sole proprietorship include the following:
- Easy and inexpensive to establish.
- The sole decision-maker in the business is the owner.
- Less expensive operational and starting costs.
A formal agreement between two or more parties to manage an organization and divide its revenues is known as a partnership. Such business entities in Malta have a separate legal identity from that of their members.
