OpusGuide: Malta – Private
foundation

Malta is a member of the EU and has an advantageous tax system which allows tax to be reduced to an effective rate of 0%. Costs relating to registering an entity in
Malta are relatively low. The country’s policy is one of attracting investors from the financial sector in particular.
Setting up a company in Malta takes one day.

 

LEGAL FORM	The private foundation is a legal entity, with separate legal personality, which set up to accumulate family funds as a personal insurance fund and is defined in the terms of the assets making up the foundation.
POLISH EQUIVALENT	Lack of direct counterpart in the Polish legislation.
SPHERE OF ACTIVITIES	Any legally permissible – vehicle for to effective asset protection as a part of an advance planning; no requirement to obtain permits (not a regulated activity).

FUNCTION OF THE EQUIVALENT BODY	ownership	Foundation is the legal owner of its own assets – the foundation’s patrimony is owned by itself.
	administration	The administration of the foundation is conducted by, at least, a designated person, the administrator, for the benefit of the beneficiary. The administrator has control over the foundation property but would not hold the same in his own name.
	other	The person, a Maltese resident, who shall be appointed to the management shall attend to the dealings of the foundation and shall represent it both in and out of Court.
USE OF TRUSTEESHIPS	beneficiary	The foundation is set up for the benefit of the beneficiary(ies) who gains benefit from the foundation in accordance with the terms of the deed of the foundation.
	Board of Trustees	There are limited reporting requirements for foundations established in Malta. Strict confidentiality rules apply in the Republic of Malta.
MINIMUM SHARE CAPITAL		Minimum share capital is EUR 1,164.69
HEADQUARTERS		Required in the territory in the Republic of Malta.

TIMESCALES	registration	Obligation for the foundation to be registered.
	dissolution	The Court is empowered to dissolve the foundation; a request could be made by the foundation itself.
BANK ACCOUNT		In any bank.
NATIONAL CURRENCY		EURO
OFFICIAL LANGUAGE		Maltese

TAXES	Income / Taxation of particular sources of income	Private foundations are subject to corporate income tax in the same way as companies (35% standard rate). Tax refund mechanism applies accordingly. Likewise companies, some sources of income are tax-exempt (under participation exemption regime or royalties exemptions).
	Special tax regime	Private foundations can opt to be treated like trusts. Then the trust taxation regime applies (profits distributed to beneficiaries are taxed at their hands and no tax implications arise when income is foreign-sourced and not received in Malta. The income may be then taxed at the residence country of beneficiaries – double taxation treaties apply).
ANTI-TAX-AVOIDANCE-RULES		Transfer pricing documentation: NO, but the transactions must be carried at arm’s length Thin capitalization: NO CFC: NO

* data binding as of 28th April 2014