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#41
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GrumpyMess said:
Even with residing for more than 183 days? They must be laughing at their taxpayers. Why have you chose TRP but not the remittance basis taxation?
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The remittance basis taxation (non domiciled resident) it’s the standard one that eu citizens get when they start the application correct?

Because I don’t found the option (not domiciled or remittance basis) on the application form J or form A
 
#42
In my case it was complicated because I asked the tax residence certificate for the 2018 and my TRP has been approved in September , they usually start from that date for the 183 days calculation, but I proved that I was permanent resident since May so they made an "exception" and I received the certificate.
Answering to your last question : actually the TRP is a personal , not corporate, remittance-base taxation, if you don't import money to Malta no taxes are applied over your income/CG/ etc. .
 
#43
blutbra said:
@ Martin Everson : tax number and tax residence certificate are two different stories , the tax number doesn't automatically give you the right to ask ,immediately, for the second one. Just to be precise I'm talking of a very recent personal experience .
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I know exactly what I am talking about here too....lol ;). You can request from the IRD using form RTCT02 at a later date. It is not relevant at all once you have your Tax ID given immediately. In fact a "Certificate of Tax Residency" is is not given at all automatically if you are a resident in Malta for years. So just wait until your first tax return and if you need the certificate for foreign authorities for whatever strange reason fill in the form RTCT02.
 
#44
@Martin Everson : this is why I wrote you cannot get the certificate "immediately" , I used the same adverb you used in your post "Like I said you get tax certificate immediately as self employed in fact the tax number is emailed the next day on completion of Expatriates Taxpayer Registration form and certificate posted a couple of days later. ". Now you correct yourself saying: "So just wait until your first tax return and if you need the certificate for foreign authorities for whatever strange reason fill in the form RTCT02. ". I don't want to argue with you, I just thought that a non-expert reader could have misunderstood your opinion which, I stress, was related to a case of a self-employed residency. A question : I don't know why you saying " for whatever strange reason" speaking about the tax residence certificate , maybe you are an extra- EU citizen ? It's just a curiosity ...
 
#46
#47
What I do not understand is why when you are a Maltese resident, you want to trade with a Maltese company? It is an obligation for your business to realize it with an MT company?

When you get Malta residence with just showing bank statements with 35k you will be approved for residence as a self-sufficient person.

And for your professional activity you will work for example with a Cyprus company + offshore with services of managing director (or another structure in which he is not a director) and you touch your dividends as foreign income, you pay 5'000 EUR tax in Malta as a package to have more than 35k of income foreign, and you have no other worries.
 
#48
Elve said:
What I do not understand is why when you are a Maltese resident, you want to trade with a Maltese company? It is an obligation for your business to realize it with an MT company?

When you get Malta residence with just showing bank statements with 35k you will be approved for residence as a self-sufficient person.

And for your professional activity you will work for example with a Cyprus company + offshore with services of managing director (or another structure in which he is not a director) and you touch your dividends as foreign income, you pay 5'000 EUR tax in Malta as a package to have more than 35k of income foreign, and you have no other worries.
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the CFC rule in Malta is clear, the owner can also manage offshore companies from malta without problem, there are just few limitations and threshold to be sure the Maltese government won't ask you to pay taxes for the foreign company...
 
#49
Osleak said:
the CFC rule in Malta is clear, the owner can also manage offshore companies from malta without problem, there are just few limitations and threshold to be sure the Maltese government won't ask you to pay taxes for the foreign company...
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How about the rule if company is managed from malta it has to pay Maltese tax?
 
#50
please read what the law say:

B 3766
Controlled
foreign
company rule.
7.
(1) An entity, or a permanent establishment of which the
profits are not subject to tax or
are exempt from tax shall be
treated as a
controlled foreign company where
the following conditions are m
et:
(a) in the case of an entity, the taxpayer by itself, or togethe
r
with its associated enterprises holds a direct or indirect part
icipation of
more than fifty per cent (50%) of the voting rights, or owns di
rectly or
indirectly more than fifty per cent (50%) of capital or is entitled to
receive more than fifty per cent
(50%) of the profits of that e
ntity; and
(b) the actual corporate tax paid
on its profits by the entity or
permanent establishment is lower
than the difference between the tax
that would have been charged on the entity or permanent establi
shment
under the Income Tax Acts and th
e actual corporate tax paid on its
profits by the entity or permanent establishment:
Provided that for the purpos
es of this paragraph, the
permanent establishment of a controlled foreign company that is
not
subject to tax or is exempt from
tax in the jurisdiction of the
controlled
foreign company shall not
be taken into account:
Provided also that the tax that would have been charged in
Malta means the tax as computed
according to the Income Tax Acts.
(2) Where an entity or permanent
establishment is treated as a
controlled foreign company under sub-regulation (1), there shal
l be
included in the tax base the non-distributed income of the enti
ty or
permanent establishment arising
from non-genuine arrangements w
hich
have been put in place for the e
ssential purpose of obtaining a
tax
advantage.
For the purposes of this sub-regul
ation, an arrangement or a se
ries
thereof shall be regarded as non-genuine to the extent that the
entity or
permanent establishment would
not own the assets or would not h
ave
undertaken the risks which generate all, or part of, its income
if it were
not controlled by a company where the significant people functi
ons,
which are relevant to those assets and risks, are carried out a
nd are
instrumental in generating the controlled company's income:
Provided that the said company
is the taxpayer and the said
significant people functions are carried out in Malta.
(3) There shall be excluded from the scope of sub-regulation (2)
an entity or permanent establishment:
(a) with accounting profits
of no more than seven hundred
and fifty thousand euro (€750,000), and non-trading income of no
more than seventy-five
thousand euro (€75,000); or

B 3767
(b) of which the accounting profits amount to no more
than ten per cent (10%) of its ope
rating costs for the tax peri
od:
Provided that the operating costs may not include the
cost of goods sold outside the country where the entity is resi
dent,
or the permanent establishment is situated, for tax purposes and
payments to associat
ed enterprises

i've done copy and paste from goverment website
 
#51
in small words:
if you are director of foreign company and you are resident non dom in Malta you will not pay taxes on the profit of the foreign company if one of the following point is met:
1) the taxation of foreign company must be bigger than the 35% ( malta corporate tax) less the taxation of the corporate tax of foreign company
2) the accounting profits of foreign company must be no more than €750,000, and non-trading income of no more than €75,000
3) the accounting profits amount must be no more than ten per cent (10%) of its operating costs for the tax period
 
#52
Osleak said:
if you are director of foreign company and you are resident non dom in Malta you will not pay taxes on the profit of the foreign company if one of the following point is met:
Click to expand...
how about the following?

An entity incorporated outside Malta is considered resident in Malta only if the
management and control of the entity is exercised in Malta. The term “management and control” is not
defined in Maltese tax law, however in practice, in order to establish that management and control is in
Malta, the Inland Revenue Department would take into account whether the board meetings of the
company are held in Malta, whether general meetings are held in Malta, and whether any other decisions
of the company are taken except at meetings in Malta
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#53
yes this is description of what it's foreign company controlled, but after there are 4 points that make HUGE difference:

Provided that the said company is the taxpayer and the said significant people functions are carried out in Malta.
(3) There shall be excluded from the scope of sub-regulation (2) an entity or permanent establishment:

(a) with accounting profits of no more than seven hundred and fifty thousand euro (€750,000), and non-trading income of no
more than seventy-five thousand euro (€75,000); or

(b) of which the accounting profits amount to no more than ten per cent (10%) of its operating costs for the tax period

so after you have read all the article of the law and not just one.... in case your turnover is less than 750.000€ for your foreign company you will own tax to the maltese governement or not???

maybe i'm not understand what i read... but looks clear the law
 
#54
@Osleak, as far as I understand these are 2 different laws, CFC law is applied for foreign companies being founded by Malta resident companies, but there is place of effective management rule, which is present even in countries without CFC law and following it a foreign company can be Malta's resident if it's management and control is exercised by Maltese resident
 
#55
for example you are resident and non dom in Malta, you have company in UK
GrumpyMess said:
@Osleak, as far as I understand these are 2 different laws, CFC law is applied for foreign companies being founded by Malta resident companies, but there is place of effective management rule, which is present even in countries without CFC law and following it a foreign company can be Malta's resident if it's management and control is exercised by Maltese resident
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please share the second law of effective management... because it's strange that one law go against another law... what is the true one?
 
#56
this is from Chetcuti | Published on 03 May 2011 | Updated on 12 Oct 2018

Taxation of non-Malta domiciled Companies resident in Malta

A company which is resident in Malta by virtue of its management and control effectively being exercised in Malta, but is not domiciled i.e. not incorporated in Malta, is charged to tax in Malta only:


  • on income arising in Malta and
  • on income arising outside Malta, but received in Malta.

Capital gains arising outside Malta but which are not remitted to Malta are not subject to tax in Malta even where these are remitted to Malta. Non-resident shareholders of companies resident in Malta in receipt of a dividend out of Malta taxed profits, may qualify for refunds of tax, provided that the relevant conditions are satisfied.


Malta resident companies may also apply the provisions of Malta's network of double tax treaties
 
#57
you should remember always the The remittance system of taxation in Malta:

A company incorporated under the laws of Malta is considered ordinarily resident and domiciled in Malta. Companies which are ordinarily resident and domiciled in Malta are subject to tax on their world-wide income. A company which is not incorporated in Malta but is managed and controlled in Malta is subject to tax on a remittance basis on its foreign sourced income.

Companies subject to tax on a remittance basis are taxed on:

  • Income and capital gains deemed to arise in Malta
  • Income deemed arise outside Malta and remitted to Malta
Companies subject to the remittance basis are not taxed on:

  • Income deemed to arise outside Malta which is not remitted to Malta
  • Capital gains arising outside Malta
source 3amalta
 
#58
Osleak said:
Companies subject to tax on a remittance basis are taxed on:
  • Income and capital gains deemed to arise in Malta
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That's the key, if you are a Maltese resident, tax office most likely will consider that income arises from Malta since management and control was from Malta. Sure for passive income such as foreign royalties or dividends it's not applied. Just remember that
Under a general anti-abuse provision, the Commissioner for Revenue is entitled to disregard for tax purposes any artificial or fictitious scheme that reduces the amount of Malta tax payable by a taxpayer, and to assess the taxpayer for tax to effectively nullify or modify the scheme and the consequent advantage. There also are a number of anti-abuse provisions targeting specific activities.Certain provisions of the EU ATAD (i.e. the interest deductibility limitation rule, CFC rules and general anti-avoidance rule) entered into force as of 1 January 2019. The provisions of the EU ATAD concerning exit taxation will enter into force as of 1 January 2020.
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I don't think it's that easy to pay 5k tax and receive any amount tax free. I would be happy to be wrong.
 
#59
GrumpyMess said:
That's the key, if you are a Maltese resident, tax office most likely will consider that income arises from Malta since management and control was from Malta. Sure for passive income such as foreign royalties or dividends it's not applied. Just remember that I don't think it's that easy to pay 5k tax and receive any amount tax free. I would be happy to be wrong.
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again this is what the beest firm in Malta declared: it's clear or not? if we can't trust of the best law firm in Malta how can we do?????????

this is what cauchi wrote:

A company which is resident in Malta by virtue of its management and control effectively being exercised in Malta, but is not domiciled i.e. not incorporated in Malta, is charged to tax in Malta only:


  • on income arising in Malta and
  • on income arising outside Malta, but received in Malta.
 
#60
i understand that you a lot of consultant are creating panic to have customers and to sell them more complex structure!
but if you make a call to the main law firms in Malta they will tell you what chetcuti cauchi wrote...
 
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