tailorclientfinder@gmail.
com 13 Feb 2024
Tax advice is our passion,
our passion is your benefit.
tailorclientfinder@gmail.com 13 Feb 2024
Content
2— Why Malta?
3— What do we do?
4— What can be your advantage by choosing Malta?
5— What is the advantage of having a Maltese company?
6— Malta Residence Programme (MRP)
7— Global Residence Programme
8— Malta Residence and Visa Programme
9— Other schemes
10 — Yachts
12 — Estate planning
13 — Citizenship
tailorclientfinder@gmail.com 13 Feb 2024
Who is the founder?
Iven De Hoon
Iven De Hoon is trained as a lawyer (Antwerp, Belgium), and is also
Master in tax and accounting at the acclaimed Vlerick Institute (Ghent,
Belgium). He has published many articles and books on different tax
topics and has more than 30 years of experience.
He is also a winner of the Willoughby Memorial Prize (St Jesus Col-
lege Oxford, 2009).
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Why Malta?
10 facts to convince you!
Malta enjoys an excellent climate, it is part of the EU, is business
friendly and has a very low crime rate. It also has a highly developed
Fact 5 — Double Tax Treaties
The Maltese government has treaties in force with over 70 countries and
industry, tourism and financial sectors. Furthermore it enjoys an excel-
this policy is expected to continue in the future.
lent cuisine, exciting nightlife and a lot of culture.
Fact 6 — Dividends
Fact 1 — Corporate tax Under Maltese law, dividends paid to non-residents are not subject to with-
The corporate tax rate in Malta is 35%. However, in practice, most compa- holding tax. Interest and royalties paid to non-residents are exempt from tax
nies will pay only 5%, which is the lowest tax rate in Europe. in Malta, if they are not connected with a permanent establishment in Malta.
Fact 2 — Personal income tax Fact 7 — Cryptocurrency hub
Malta created recently a complete new legal framework for ICO’s and cryp-
In most cases the personal tax rate will only be 15% on the revenues of the
tocurrency exchanges. Malta has become an important cryptohub!
money and assets you bring into Malta. Good to know is that Malta has a
territorial tax system. So, everything you earn outside of Malta is not taxable Fact 8 — Language and part of the EU
in Malta. Multilingual workforce – English is the primary language. Italian, French,
German and Spanish are also widely spoken. Malta also has a good health
Fact 3 — Residency care system and very good schools that are teaching in English. Of course,
Malta has a very attractive residential scheme for EU and non-EU citizens.
Malta is part of the EU and the eurozone.
This, amongst others, means that it is possible to become a tax resident
in Malta quite easily and enjoy the low tax rates. Malta does not require Fact 9 — Inheritance
its residents to stay a minimum number of days in Malta (more details are There is no inheritance tax. However, a transfer tax of 5% is payable by the
provided further on in this brochure). heir of the declared property value.
Fact 4 — Citizenship Fact 10 — Trust – Yachting - Aircrafts
Malta also has an attractive scheme to become a citizen of Malta, which Malta has a well-thought-out trust law, based on the Jersey trust law. Addi-
gives you the right to live anywhere in the European Union. tionally, it has attractive schemes in place for yachts and aircrafts.
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What do we do?
We aim to provide affordable international tax and legal advice. We do not advise you to engage in
tax evasion, but in tax planning!
Tax planning Substance
This term implies that a taxpayer has made arrangements to either reduce An international structure only makes sense when we have ‘substance’. Sub-
its tax burden or to avoid paying taxes as a result of these arrangements. stance is indeed a key theme in international structures and in international
This term is generally used to indicate that the taxpayer has taken lawful tax planning. Various tax authorities and courts around the world are attack-
actions and is fundamentally different from the concept of ‘tax evasion’, ing structures with a lack of substance. Since the OECD presented their ac-
which is illegal. tion plan on BEPS, the importance of substance has significantly increased.
A lack of substance could leave you with a considerably higher effective tax
burden on your business activity, while also being in big trouble with the tax
Tax evasion
authorities. The extent to which substance needs to be organised depends
Fraudulent or illegal arrangements made with the intention of evading tax on what it is aimed at - an office and an employee are definitely required.
payments, e.g. by failing to fully disclose revenues to the authorities. The Furthermore, the staff should have some basic level of decision power, oth-
term refers to activities deliberately undertaken by a taxpayer to attempt to erwise the tax authorities will easily take a position that decisions are taken
free himself, illegally, from paying the taxes that are due. Tax evasion uses in a foreign jurisdiction and not in the jurisdiction in which you have set up
activities like sham transactions and falsification of tax returns or books your corporate entity, resulting in a lack of economic substance.
and accounts. The fact that it is illegal distinguishes tax evasion from tax
avoidance.
We do not sell companies or structures as such
We give tax and legal advice! We do not sell structures. We offer a
tax-friendly solution by using the structure best suited to your situation at
that particular time. But we do not stop at the advice, we also implement
the full structure for you! Our fees are very acceptable and transparent!
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tailorclientfinder@gmail.com 13 Feb 2024
What can be your advantage by choosing Malta?
Malta is a highly creative and driven jurisdiction.
The government continually questions its fiscal schemes and legislation in
order to offer maximum benefits to potentially interested parties. Moreover, all
proposals are cross-checked with the EU and with international organizations.
Malta wishes to reward motivated entrepreneurs from a tax point of view,
without being a shady tax haven. Therefore, the fact that you are operating from
Malta will not be looked upon strangely internationally. Malta is a respected and
transparent jurisdiction. However, it encourages entrepreneurship and, unlike
many other countries, does not chase away companies.
The advantages of operating from Malta can be various and numerous and we
will try to explain them briefly in this brochure. Of course, we are available to
answer all your questions on Malta or other jurisdictions. Just drop us an e-mail
at: info@dehoon-dhp.com
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What is the advantage of having a Maltese company?
In Malta in practice, you can benefit from the lowest corporate tax rate in the European Union.
The system is somewhat complex, however. We will quickly explain the basics.
Let us assume the following: MORE:
You have a Maltese company and a profit of 100. Malta is a respected jurisdiction, boasting a very low tax burden if you take
What happens next? You will be taxed at a 35% rate, which is not really smart action.
appealing at first sight. On top of that, it is an interesting holding country, since there is no with-
However… if this company distributes a dividend to the shareholder, the holding tax on dividend payments.
Maltese government will (under certain conditions) reimburse 6/7 of the tax Since Malta does not levy withholding tax, no withholding tax is levied on
paid, a so-called “refund”. dividend payments. Moreover, Malta is an EU member state and, therefore,
To whom? To the shareholder who will obtain a 30 percentage point refund the EU Parent-Subsidiary Directive applies. Finally, Malta also has an exten-
on the 35% corporate tax paid. sive and interesting network of double tax treaties.
Example
Malta Co
Taxable profit: 100 35% corporate tax 6/7 corporate tax
35% tax: 35 refund
Balance: 65
Malta Co distributes a dividend to INT Co Malta Co Government INT Co
INT CO receives: 65
Plus an additional: 30 (6/7 of 35)
Total: 95
Hence: 5% effective tax burden
The shareholder can be a natural person dividend
or a Maltese or foreign company.
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Malta Residence Programme (MRP)
What makes Malta really appealing is its residence programmes. Here you will find an overview.
Most of these programs are very appealing from a tax point of view. Why is What is the advantage?
that? They enable you to become a taxable person in Malta at very benefi-
• you do not need to pay taxes on any revenue earned outside of Malta;
cial tax rates and to avoid taxes in your (former) country of residence, in a
• hence, it is legal, for example, to keep bank accounts outside of Malta and
perfectly legal manner.
not be taxed on the potential return;
Who is it aimed at? • any income brought into Malta will be taxed at a 15% flat rate;
• EU residents and residents of Norway, Liechtenstein, Iceland and Swit- • however, you will always pay at least 15,000 EUR in taxes;
zerland; • all other Maltese income (e.g. rental income in Malta) will be taxed at 35%.
• who are not permanent residents of Malta;
• who have sufficient income to support themselves and their families; What is the minimum amount of days you need to reside in Malta?
• who own a property which they live in or which they rent out, with a The minimum amount of days you need to reside in Malta has been formu-
purchase value of 275,000 EUR; lated in a very clever way…
• or who spend more than 9600 EUR annually on renting a property in It is stated that you CANNOT reside more than 183 days in another coun-
which they have their main residence (meaning they cannot sublet the try…To put it into other words, there is no minimum amount of days you
property). need to reside in Malta…
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Global Residence Programme
Another interesting residence programme is the ‘Global Residence Programme’ (GRP). This is a programme specifically
aimed at non-EU residents!
Who is it aimed at? What is the minimum amount of days you need to reside in Mal-
• non-EU residents and non-residents of Norway, Liechtenstein, Iceland and ta?
Switzerland; The minimum amount of days you need to reside in Malta has been formu-
• who are not permanent residents of Malta; lated in a very clever way.
• who have sufficient income to support themselves and their families; It is stated that you CANNOT reside more than 183 days in another coun-
• who own a property which they live in or which they rent out, with a try…To put it into other words, there is no minimum amount of days you
minimum purchase value of 275,000 EUR; need to reside in Malta...
• or who spend more than 9600 EUR annually on renting a property in
which they have their main residence (meaning they cannot sublet it);
• who have taken out health insurance;
• who have lived in Malta for less than five years.
What is the advantage?
• you do not need to pay taxes on any revenue earned outside of Malta;
• hence, it is legal, for instance, to keep bank accounts outside of Malta and
not be taxed on the potential return;
• any income brought into Malta will be taxed at a 15% flat rate;
• however, you will always pay at least 15,000 EUR in taxes;
• all other Maltese income (e.g. rental income in Malta) will be taxed at 35%.
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Malta Residence and Visa Programme
This is a special regime exclusively aimed at non-EU residents and non-residents of Norway, Liechtenstein,
Iceland and Switzerland.
Who is it aimed at? What will taxes be like?
• non-EU residents and non-residents of Norway, Liechtenstein, Iceland In principle you will pay the same taxes as the Maltese (top rate being 35%).
and Switzerland; But you can also benefit from the tax advantages of the ‘Global Residence
• who own a property in Malta, with a market value of 320,000 EUR or Programme’ (see above), meaning that foreign income received in Malta will
more and who live in this property; only be taxed at 15%.
• or you need to rent it out for 12,000 EUR or more on an annual basis;
• you need to pay a one-off fee of 30,000 EUR to the Maltese government
(this amount will not be refunded);
• additionally, you need to make a statement saying that you have an annu-
al income of 100,000 EUR or more outside of Malta;
• or that you have capital of 500,000 EUR or more;
• and that you will hold on to an eligible investment for at least 5 years, the
initial amount of which will be 250,000 EUR or more.
What is the advantage?
• this programme entitles you (and any dependants) to live in Malta for an
undetermined period of time;
• and what is far more interesting, this programme entitles you to travel
within the Schengen zone without a visa.
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Other schemes
Highly Qualified Persons Rules
This scheme has specifically been created to attract highly qualified individ-
uals to work and reside in Malta, in particular for companies in the financial
industry, the gambling industry or in the aviation industry.
One of the main criteria is that your salary shall be at least 75,000 EUR annu-
ally. The advantage is that this salary will only be taxed at 15%. This scheme
will apply for 5 years for both EU residents and residents of Switzerland,
Norway, Iceland and Liechtenstein. This five-year term can be renewed for
the same period once. For residents of countries outside the EU, a four-year
term is applicable.
Malta retirement programme
This is a specific programme aimed at EU retirees and retirees of Switzerland,
Norway, Iceland and Liechtenstein.
The conditions are that the individual stopped working and receives a
pension in Malta, representing at least 75% of the tax payer’s income. Once
again, the individual needs to own a home, with a purchase value of 275,000
EUR or needs to spend 9600 EUR or more on rent annually. And again, in
principle…you cannot live more than 183 days in another country.
Under this scheme you will pay at least 7500 EUR tax annually, plus 500 EUR
for every additional dependant. And your remaining income (such as your
pension) received in Malta will be taxed at 15%.
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Yachts
Malta also has a few interesting structures with regard to yachts.
When purchasing a new yacht, you might be able to save a lot in VAT. The Mal-
tese government assumes that, if your yacht is bigger, you will sail outside of EU
waters more often, causing you to owe less VAT. As such, it might be useful, for
instance, to have a yacht built at a Dutch shipyard and to purchase it through a
Maltese company afterwards.
There are other interesting options available through financial leasing of yachts.
Please get in touch for more details.
Additionally, Malta is the 5th most important maritime registry worldwide. As
such, it is very appealing to sail under the Maltese flag for a number of different
reasons. For instance, ship owners, charters and financiers are given all kinds of
tax benefits. The entire legislative framework surrounding the maritime industry
is highly flexible.
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Here you will find an overview of VAT rates used:
% of lease Effective rate
Type of yacht subject to VAT of VAT
Yachts over 24 metres in length 30% 5.4%
Sailing yachts between 20.01 and 24 metres in length 40% 7.2%
Motor yachts between 16.01 and 24 metres in length 40% 7.2%
Sailing yachts between 10.01 and 20 metres in length 50% 9%
Motor yachts between 12.01 and 16 metres in length 50% 9%
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Estate planning
It is also nice to know that Malta does not levy any inheritance tax or gift tax. On top of that, Malta has got a trust and
foundation structure which can be optimised from a tax point of view.
Moreover, Malta is one of the best jurisdictions for setting up a fund. It is a
reliable transparent jurisdiction, boasting a solid banking system. Setting up a
fund here is a great deal faster, more flexible and cheaper than in Switzerland or
Luxemburg, to name but a few.
Like we told before it’s now one of the best places to launch an ICO or to start
your cryptobusiness.
Contact us for more details and information if you have those plans.
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Citizenship
Malta also has a programme for obtaining Maltese citizenship. It is not the cheapest, but certainly the best of its kind, since it
entitles you to settle in one of the 28 EU countries.
Maltese Citizenship is granted to suitable individuals and families who Furthermore, Due Diligence fees apply, and these have been set at the fol-
hold resident status in Malta for a period of twelve months immediately lowing levels: for the main applicant: EUR 7,500; for spouses, adult children
preceding the day of issuing of the certificate of naturalization and who and parents: EUR 5,000; for children between 13 and 18 years of age: EUR
qualify under the very strict due diligence regime. All individuals and families 3,000 each.
applying to the Malta Individual Investor Programme must make a significant
The applicant must commit to retaining a residence in Malta for a period of
contribution to the National Development and Social Fund established by
at least 5 years, either through the purchase of a property, for which the
the Government. The minimum contribution levels that must be met in the
minimum value must be EUR 350,000, or through leasing of a property, for
initial phase of the program have been set out as follows:
which the minimum annual rent must be EUR 16,000.
• contribution to the National Development and Social Fund of EUR
In addition, an investment of EUR 150,000 in government approved finan-
650,000 for the main applicant;
cial instruments, which must be maintained for a minimum period of 5 years,
• contribution for the spouse and minor children: EUR 25,000 each; is required.
• contribution for dependent children from 18 to 26 years old or depen-
When you acquire citizenship under the Malta Individual Investor Pro-
dent parents above 55 years of age: EUR 50,000 each.
gramme, you and your family enjoy full citizenship for life, which can be
passed on to future generations by descent.
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