Malta Limited Liability Company: Key considerations post-incorporation

02 March 2020

Upon registering the company with the Registrar of Companies and obtaining the company number, ZEDRA will then assist you with the following tasks that need to be carried out prior to start operating:

DDT 10

Exemption from Duty on Documents and Transfers

Following the incorporation of the Company, it is necessary to deliver to a certified copy of the memorandum and articles of association, to the Commissioner of Inland Revenue, together with an application (DDT10A or DDT10B form), for an exemption from duty on documents and transfers in terms of article 47 of the Duty on Documents and Transfers Act.

The effect of this application, when the exemption is granted, is to ensure that acquisitions or disposals of marketable securities by or issued by the company will be exempt from duty and documents within the provisions of the Act.

This application is filed with the Commissioner of Inland Revenue hoses in the same premises as the Registry of Companies. There are two application forms:

  • The Form DDT10A; and
  • The Form DDT10B

The Form DDT 10A intended for use by companies operating a “foreign income account” which have the majority of their business interests outside Malta and fall within the provisions of Article 47(3)(d) of the Duty on Documents and Transfers Act.

On the other hand, the form DDT 10B is intended for use by collective investment schemes, investment services companies and international trading companies.

Following the application and acceptance of either form, a printed certificate shall be issued by the Commissioner of Inland Revenue. This certificate states that the exemption will automatically lapse, on the occurrence of any of the following:

  • if the company ceases to satisfy the provisions of Duty on Documents and Transfers Act under which it was issued; or
  • if the company has been registered as being continued in Malta in accordance with the provisions of the Continuation of Companies Regulations, 2002 but does not submit a copy of the certificate of continuation issued by the Registrar within fifteen (15) days of the issue of such certificate.

Tax Registration

At this stage, ZEDRA will assist you to obtain a Tax Identification number.  In order to obtain this number, we are required to provide to the Inland Revenue Department, a copy of the Company’s certificate of Incorporation.

VAT Registration

The company would need to be registered for VAT purposes. It intends carrying out a trading activity in Malta in providing services to third parties.  In order to register for VAT, one would need to first determine under which Article the company will be registered and then completes the respective Application Form.  In addition to the Application, one should also provide the company’s tax number, a copy of the Memorandum and Articles of Association as well as a copy of the original certificate of registration.

 FATCA Classification

The Foreign Account Tax Compliance Act (FATCA) is a US law enacted in 2010 as part of the Hire Act.  In 2013, Malta and the US Government signed an intergovernmental agreement to implement FATCA and has been transposed to the Maltese Law through Legal Office 78 of 2014.  It imposes an obligation of the directors of the Malta companies to classify each and every company irrespective of the residence of the shareholders and whether they carry out any activities in the US or with US companies. The latter will, however, affect the reporting obligations that the directors have towards the Tax Authority in Malta.

Opening of the bank account

Although it is not a legal requirement to open a bank account in Malta we always suggest, due to the various development taking place internationally, for the company to open an account with a Maltese Bank. Having an accountant in Malta does not preclude the company to have other bank accounts in foreign jurisdictions.

Contact Rudolph Psaila to find out more.

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