Key contacts Ivan Cini
ivan.cini@quantumpartners.eu Advisory & Accounting . Corporate Services . Investment Services Compliance and Support.
Brian Farrugia
brian.farrugia@quantumpartners.eu Advisory & Accounting . Corporate Services . iGaming . Banking and Corporate Finance
Dr Carlo Vigna
carlo.vigna@quantumpartners.eu Corporate Services & Trusts . Legal
Dr Damien Fiott
damien.fiott@quantumpartners.eu Corporate Services . Tax . Legal
Our Expertise. Your Solutions. Advisory | Corporate & Trusts | Tax & Legal | iGaming
About Us
Quantum Group is a boutique organisation providing a comprehensive package of business incorporation, advisory and support services. Our team includes accountants, bankers, lawyers and executives with years of experience in corporate finance, corporate matters, tax and business advisory services.
Our centres of expertise Quantum Partners Limited providing advisory, accounting and back office, corporate & business support services
Arx Trustees Limited (MFSA licenced) providing trustee, fiduciary and administration services
Quantum Corporate Services Limited providing corporate directorship services for select entities and companies
Quantum Gaming Services Limited providing advisory, licencing, key official and support services for betting, gaming and online casino operators
Tax & Legal Services
The Quantum team includes in-house lawyers who provide advice and assistance on a wide variety of corporate and commercial transactions as well as tax advice & planning, advice on regulated services and dispute resolution
Our reach...our clients
We assist and advise local and multinational clients operating in Malta and other jurisdictions. We collaborate with foreign-based firms and consultants to address cross-jurisdictional issues and to better assist clients that conduct business in multiple jurisdictions. Our clients include family owned businesses and multinationals hailing from various industries including energy, funds & capital markets, manufacturing & distribution, maritime, tourism, real estate, pharmaceutical and betting & gaming.
Our Services
We firmly believe in providing holistic and strategic solutions to the needs of our clients, with a view of creating synergies and value added beyond the original requirements of the clients themselves.
Advisory
Accounting & book-keeping Management reporting Fund & asset management support Payroll Business and cash-flow plans, forecasts and feasibility studies Corporate finance Liquidation support
Tax, Legal Advice and Support
Tax advice & planning (local and Cross-border) Tax compliance (corporate and individuals) Tax disputes & litigation Advice on business and commercial law Transaction coordination and completion Ship & yacht & aircraft registration
Corporate & Trust
Company formation & redomiciliation Fiduciary & trust services Foundation administration Management, back-office and corporate compliance & support services Secretarial and directorship services
iGaming
Advisory services for internet gaming, betting & casino operators Incorporation, Licensing and Compliance services Key official and support services
Malta…a Pro-Business & Cost-Effective Jurisdiction The Maltese economy is a very open one in which foreign direct investment in many of its sectors is vital to its continued growth. The overriding climate is one of encouraging and assisting inward investment particularly in target sectors such as banking and funds, maritime and aviation, internet betting and gaming and related industries.
Success factors
Key facts
well regulated jurisdiction
EU member since 2004 and Eurozone member since 2008
an attractive and comprehensive International Tax and Participation Exemption regime absence of withholding taxes, CFC and thin-cap rules tax exemptions on share transfers by non-residents, interest and royalties from qualifying patents, copyright and IP option to step-up the base cost of assets in the course of a transfer of residence or domicile to Malta or pursuant to a cross-border merger an extensive double taxation treaty network (including all EU Member States) incentives for specific sectors such as R&D, shipping, aviation, funds & financial services, internet gaming tax incentives and support measures for satellite activities and foreign individuals working or residing Malta
(unicameral) Parliamentary Republic since 1974 Civil law country with some common law influences Company and Tax laws are largely based on the UK model English is an official language Timezone - CET
KEY OPPORTUNITIES Corporate tax & participation exemption
a competitive tax regime for holding and trading operations Malta’s tax laws offer a full imputation system and allow shareholders of Maltese companies to claim a refund of tax paid by the Maltese company. The corporate headline tax rate of 35% can be mitigated as follows: 6/7ths refund - refund of 30% out of 35% - 5% effective tax rate (typically due on trading profits). 5/7ths refunds - refund of 25% - 10% effective rate - due in respect of passive interest & royalties. 2/3rds refund due where the company has claimed double taxation relief. 100% refund due where the profits derive from a Participating Holding
Participation Exemption Profits deriving from a Participating Holding or from gains realised on the disposal of such holding are, subject to certain conditions, exempt from Maltese tax. A Participating Holding exists where a Maltese company holds at least 10% equity shareholding in a non-resident company or similar entity – the level of equity holding may be less than 10% subject to certain conditions. A Participation Exemption is also available in respect of gains derived from the disposal of qualifying equity in a Maltese company as well as to profits derived from a foreign PE or gains from the transfer of a foreign PE.
Branches of foreign companies An interesting feature of Malta’s tax system is that foreign companies are allowed to claim a refund of tax paid by their Maltese branch. This rule represents interesting tax planning opportunities for foreign companies wishing to operate from Malta through a branch rather than through a subsidiary.
Malta Double Taxation Treaty Network - a total of 66 treaties including all EU Member States Albania Australia Austria Bahrain Barbados Belgium Bulgaria Canada China Croatia Cyprus Czech Republic Denmark Egypt Estonia Finland France
Georgia Germany Greece Guernsey Hong Kong Hungary Iceland India Ireland Isle of Man Italy Jersey Jordan Korea, Rep. Kuwait Latvia Lebanon
Libya Lithuania Luxembourg Malaysia Mexico Montenegro Morocco Netherlands Norway Pakistan Poland Portugal Qatar Romania Russia San Marino Saudi Arabia
Serbia Singapore Slovakia Slovenia South Africa Spain Sweden Switzerland Syria Tunisia Turkey UAE UK Uruguay USA
Treaties awaiting ratification / not yet in force: Bosnia & Herzegovina, Israel, Palestinian Auth., Oman, Thailand and Ukraine
Tax Information Exchange Agreements (in force): Bermuda . Bahamas . Gibraltar Alternative double taxation relief methods
Domestic rules are aimed at ensuring that income originating from overseas is not subject to double taxation even if there is no double taxation agreement in existence. Relief is provided on a unilateral basis (Unilateral Relief), through a Flat Rate Foreign Tax Credit (FRFTC), underlying relief and Commonwealth Relief.
Our services
We offer a full range of tax advisory and compliance services for corporate entities and individuals.
TRUSTS AND FOUNDATIONS
innovative tools for asset management, estate planning and family offices Trusts and foundations have become useful tools in wealth and asset management, estate planning and family office management. Trusts and foundations are generally transparent for tax purposes and therefore benefit to the attractive tax refund and participation regime available for companies. Although trusts and foundations are generally transparent from a tax planning perspective and do not present any significant tax advantages, they do benefit from all the tax exemptions and deferments available to asset and property transactions taking place outside a trust or foundation scenario.
Our services
ARX Trustees Limited is licensed by the Malta Financial Services Authority to act as a trustee and we are therefore in a position to provide a full range of trust and fiduciary services as well as acting as foundation administrators.
INTELLECTUAL PROPERTY an ideal holding and trading jurisdiction Royalties exemption
Royalties and similar income derived from qualifying patents, copyright and trademarks are exempt from tax. The exemption extends to dividends paid by the company deriving the royalties up to the level of the individual shareholder.
Film & Audiovisual Industry
Production companies filming in Malta qualify for financial incentives consisting in cash grants calculated as a portion of eligible expenditure incurred in Malta. Up to 22% of the eligible expenditure can be refunded to a qualifying production company upon completion of filming. Feature film and television productions, mini-series, animation and documentaries are all eligible for the incentives, as long as they are at least partially produced in Malta. In order for a company to qualify for the above grants, it is not necessary for the distribution of such production to be made from Malta.
Tax credits
Tax credits are available in respect of investment costs and wage costs incurred in the course of a production or related audiovisual project.
Our services
We assist clients in IP registration and renewal procedures and advise on tax optimised holding and trading structures. We also provide tax advisory services and assistance to film producers and production support operators.
MARITIME & AVIATION
a hub for international Commercial Operations, Management & Servicing Malta’s location and open policy towards forward direct investment has given its great strategic importance and has established itself as for aircraft, ship and yacht registration, mortgage registration, financing, brokerage, maintenance, classification and surveying.
Tax exemptions for shipping activities Maltese law contains attractive tax benefits for licenced entities operating qualifying ships/ships and carrying on certain shipping activities. Qualifying shipping activities include the ownership / operation / administration / management and financing of ships registered in Malta and in other countries as well as the holding of shares or interests in entities carrying any of the above activities. Maltese law provides for the following exemptions: exemption on income tax in respect of profits derived by a shipping entity from qualifying shipping activities (the exemption is subject to certain conditions, mainly the payment of the applicable tonnage tax) exemption from capital gains tax on transfers of shares or securities in a shipping entity exemption from stamp duty on the transfer of securities or shares in a shipping entity (under general rules, a transfer of shares would be subject to stamp duty at 2%) exemption from tax on any interest or other income received in respect of the financing of shipping entities or ships.
Aviation - Tax planning opportunities for cross-border operations Malta has introduced a comprehensive regime for aviation operators aimed at ensuring effective tax results for international operations including financing and leasing. The measures include Malta’s adoption of the Cape Town Convention (CTC), the creation of an aircraft and mortgage register, a comprehensive trust legislative framework and a number of tax measures and incentives. Income derived by operators from the ownership, leasing or operation of aircrafts or aircraft engines used in international aviation business is deemed to arise outside Malta regardless of the country of registration of the aircraft/ engines or whether the aircraft calls at or operates from Malta. Aviation operators who are only resident (but not incorporated) in Malta are subject to Maltese tax on their foreign-source income that is received in Malta. The main implications of this tax treatment are the absence of withholding tax on lease payments made by Maltese resident lessees to non-resident lessors and the limitation of tax to foreign source income that is remitted to Malta.
VAT planning for yacht & aircraft leasing – ‘effective use and enjoyment’ test Maltese VAT legislation contains simplification measures applying the ‘effective use and enjoyment’ criterion in the context of private yacht short term and long terms charters and leasing as well as private aircraft leasing. The headline VAT rate is 18% but it is charged on the portion of the charter/lease that is treated as effectively used and enjoyed in Malta and the EU. The effective VAT exposure can be significantly reduced to 5.4% in the case of yachts exceeding 24m. Higher VAT effective rates are available on yachts less than 24 metres long. In the case of aircraft, the effective use and enjoyment portion is determined by reference to the aircraft’s Range and Maximum Take-Off Mass (MTOM) and the maximum deemed percentage of use outside the EU according is 70% (thus resulting in a 5.4% effective VAT rate).
Other features VAT exemption on aircraft and yacht commercial operations (exemption extends to ancillary supplies such as berthing, maintenance & fuelling) Specific rules on tax treatment of finance leasing of aircraft Accelerated depreciation - minimum 6 years for aircraft, engines and refits and minimum 4 years for aircraft interior parts. Tax credits on repair, overhaul and maintenance of aircraft, engines and equipment 15% tax on employment income of expatriate personnel working with Malta-based aircraft operators.
Our services Our group is in a position to assist aviation operators by identifying the appropriate corporate structures, providing tax and VAT advice as well as sale, lease & charter transaction coordination.
BANKING, INSURANCE, FUNDS & CAPITAL MARKETS A comprehensive regulatory and tax framework
Today, Malta boasts of one of the fastest growing financial services markets and a number of factors, including EU membership, a competitive tax regime and the possibility of passporting rights, have contributed and continues to contribute towards a steady growth of the financial services industry. Malta has a comprehensive set of legislation regulating capital markets, banking and insurance. Banking legislation regulates financial and credit institutions’ activities including financial leasing, payment services, foreign exchange, portfolio management and advice and electronic money trading. Comprehensive Insurance legislation regulates all aspects of insurance including captives and cell-structured entities.
Funds Different types of funds may be set up depending on the investment characteristics and investors’ profile. Private Collective Investment Schemes are subject to recognition by the Malta Financial Services Authority (“MFSA”) and are designed for a pool of 15 related investors or less. Private schemes may be set up as private or public companies, SICAVs and INVCOs, partnership, a unit trust or mutual fund. The most common legal form for a collective investment scheme in Malta is the SICAV (multi class or single class open ended investment company), due particularly to the structural and operational flexibility associated with such forms of entities. ‘Umbrella’ funds are possible and provide for ring-fencing for assets and liabilities between the various sub-funds.
Tax Treatment of Private Schemes
Private Schemes do not enjoy the tax exemption applicable to collective investment schemes. However, private schemes may qualify for a participation exemption or an effective tax rate that is lower than the 35% headline rate depending on the characterisation of the income derived by the scheme or the respective sub-fund/s.
Professional Investor Funds (PIFs)
PIFs are non-retail type hedge funds and are widely used for investment in non-traditional investments or specialist instruments including private equity and derivatives. PIFs can be set up as an open or close-ended investment company, a limited partnership or a unit trust and are not subject to any investment or borrowing restrictions. They may only be promoted to certain type of
investors. The tax treatment of PIFs depends on the type of fund - Prescribed Funds (funds with more than 85% of assets situated in Malta) and Non-Prescribed Funds. Prescribed funds are taxed at 15% on bank interest and 10% on other income or interest sourced from Malta Government Securities or Bonds or other Government corporations. Non-prescribed funds are exempt from both income and capital gains, as well as from duty on documents and transfers.
Pension funds
Retirement Schemes have become a significant element in investment planning. To this effect, Malta has enacted specific legislation enabling the incorporation of pension and retirement funds and has managed to obtain recognition from the UK HMRC for QROPS and QNUPS-type of funds. Malta’s favourable tax regime for qualifying pension funds/retirement schemes and their respective beneficiaries attracted a number of funds and fund administrators to operate from Malta.
Our services
We assist investors and operators in the financial services industry by identifying the appropriate structure and accompanying clients through their preliminary, licencing and operational stages by providing advisory, tax and legal support and where necessary, by introducing them to external services providers for statutory services.
TAX PLANNING FOR INDIVIDUALS - Working, Residing or Retiring in Malta Malta offers a number of tax friendly opportunities to foreigners wishing to relocate to Malta for settlement, retirement or work purposes. Below are highlights of current available programmes and rules. HNWI Residence Scheme is open to EU citizens and their family wishing to live in Malta. Qualifying individuals are subject to Maltese tax at 15% on foreign income that is received in Malta (remittance basis). The minimum annual tax is €20.000 for the qualifying individual plus an additional annual tax of €2.500 for every dependant living with the individual. Foreign capital gains are not subject to Maltese tax. Revised/lower tax and entry conditions thresholds for EU citizens are expected to be introduced soon. The Global Residence Programme (GRP) is available to non-EU/EEA/Swiss citizens wishing to relocate to Malta. Qualifying individuals are subject to Maltese tax at 15% on foreign income that is received in Malta subject to a minimum annual tax is €15.000. Foreign capital gains are not subject to Maltese tax. The Malta Retirement Programme (MRP) is available to EU/EEA/Swiss citizens/passport holders and provides for a 15% tax on pension income received in Malta subject to a minimum annual tax of €7.500. Foreign professionals working in Malta in target sectors qualify for a 15% tax rate on their employment income subject to minimum tax of €11,250. This option is available to qualified persons who occupy senior and technical posts with companies licensed or recognized by the Malta Financial Services Authority (MFSA) such as banks, fund managers and insurers, companies conducting internet gaming and lottery operations and Aircraft Operators Certificate (AOC) holders. Posts include those of CFO, CEO, CRO, COO, Marketing/Investor relations managers, betting odds compilers, SEO managers, Aviation operations and training managers etc.
Our services We assist foreign individuals and their families who wish to relocate or to move to Malta by guiding them through various stages and by assisting them in all initial and ongoing legal, tax and residence compliance matters. We are registered as authorised mandatories for the purposes of the HNWI, GRP and MRP purposes.
INTERNET & REMOTE GAMING a leading jurisdiction
Malta is a leading EU jurisdiction for internet and remote gaming operations. This achievement is largely due to a comprehensive regulatory framework and tax planning opportunities for internet/online gaming, casino and lottery operations. Gaming operators require a licence by the Malta Lotteries and Gaming Authority (LGA). One of the conditions for the issue of an LGA Licence is the appointment of a Key Official who is a director of a company and who must be physically resident in Malta. The KO serves as the direct point of communication between the LGA and the operator and is responsible for supervision and compliance with laws and licence conditions. Our services
We can assist clients who wish to set up remote gaming operations in Malta by providing a full range of initial and ongoing support services preparing and submission of remote gaming licence applications and liaising with the LGA throughout all stages; preparation of a business plan; Tax and VAT optimisation and planning; acting as Key Official; sourcing IT infrastructure support, overseeing B2B arrangements including software platforms and payment gateways;
We look forward to being of service. 188 . 21st September Avenue . Naxxar . NXR1012 . MALTA +356 20106700 CET www.quantumpartners.eu info@quantumpartners.eu