If you're looking to relocate your business to Europe, Malta presents an attractive option. As a member of the European Union, Malta provides easy access to the massive EU market, along with a business-friendly tax regime and lower operational costs compared to much of Western Europe. This guide will walk you through the major steps and considerations for moving your American business to Malta.
Choosing a Legal Structure
One of the first decisions you'll need to make when starting a business in Malta is choosing the legal structure for your Maltese entity. For most companies, a private limited company is the best choice, as it provides liability protection while allowing you to take advantage of Malta's corporate tax system.
Hiring Employees
Once you've established your business structure, the next step is hiring employees for your Maltese operations. With a total population of approximately 544,583 and a workforce of around 260,000 individuals, Malta offers a diverse and highly skilled talent pool.
In 2023, Malta ranked third among countries with the largest foreign population, reflecting the strong international presence within its workforce. Many professionals bring global expertise, making Malta an attractive destination for businesses seeking multilingual and highly educated employees. English is widely spoken alongside Maltese, ensuring seamless communication in international business environments.
Labor costs in Malta are lower than some countries, though salaries for specialized roles like engineers may be higher due to demand. Employers should carefully budget for payroll and benefits, keeping in mind local employment laws and registration requirements.
Office Space and Housing
Malta has become a favoured choice for people seeking European business opportunities. Starting your search for office space and housing early is key. In Malta's main business hub around Valletta, prime office space fills up quickly. To find the best options, search for properties online on sites like WorkSpaces.
Using Company Formation Agents
Navigating Malta's business registration system can be complex for newcomers. Using a local company formation agent can streamline the process. Reputable agents assist with the following:
- Choosing a legal structure
- Drafting documents & obtaining licenses
- Navigating bureaucracy
While not required, formation agents reduce headaches, allowing you to focus on growing your business. Be sure to choose an established, licensed agent with a track record of working with foreign firms.
Tax Considerations
One of Malta's top advantages is its business-friendly tax regime. Corporate income tax is set at 35%, but refunds can reduce this to just 5% on foreign-sourced profits. Additionally, Malta does not tax dividends, interest, royalties, or capital gains, making it highly attractive for international businesses.
Malta's tax system is designed to attract global companies while complying with EU regulations. A qualified accountant can help you maximise the tax incentives and minimise your tax burden.
Finance and Banking
Malta uses the euro currency, simplifying transactions within Europe. Major banks, including HSBC, Bank of Valletta (BOV), and APS Bank, offer secure financial services with multi-currency accounts and international transfers. Opening a business account is straightforward, and Malta's EU-compliant banking system ensures stability while offering competitive exchange rates.
Immigration and Visas
You can enter Malta visa-free for up to 90 days, but those planning long-term stays must obtain appropriate visas. High-net-worth individuals can explore the Malta Individual Investor Programme, while employees require work permits tied to employer sponsorship. Consulting Maltese immigration professionals ensure a smooth relocation process.
The Pros and Cons of Relocating Your Business to Malta
Moving your business to Malta has clear benefits, including its strategic EU location, tax advantages, and multilingual workforce. Companies can lower tax rates, access a strong economy, and benefit from stable financial regulations. Residency programmes also support long-term relocation for business owners.
However, challenges exist, such as high competition for office space, strict work permit requirements for non-EU employees, and bureaucratic delays in licensing. While Malta offers access to the EU market, its domestic customer base is relatively small, and the cost of living can be higher than expected. With careful planning, these obstacles can be managed, making Malta a strong option for international business expansion.
Relocating your business to Malta requires careful planning, but the benefits make it worthwhile. With its strategic location, multilingual workforce, and attractive incentives, Malta serves as an ideal hub for accessing European markets.
