Malta offers effective tax structures for the ownership of the intellectual property and the channelling of fees generated from licensing rights. The Malta Company is a very effective international tax-planning vehicle and is suitable for:
- licensed investment services activities;
- brokerage activities & commission income;
- management and consultancy activities;
- international trading business;
- e-commerce activities;
- licensed online gaming & betting activities;
- ownership & licensing of patents, copyrights, trademarks, franchises, domain names and other intangible assets;
- property ownership & project management;
- ownership and leasing of machinery, foreign registered motor vehicles and trucks;
- hold assets and investments of all kinds (intellectual property, real estate, shares & securities, bank accounts, etc).
Malta IP holding company receiving Passive royalties
Malta Company structure may either trade in Royalties and generate trading income or Royalty income received can arise to a Malt could arise may be either passive income or income arising from actively trading in intellectual property. Passive royalties income defined
The Income Tax Act defines passive interest and royalties as interest or royalties income which is not derived, directly or indirectly, from a trade or business, and
(1) such interest has not suffered any foreign tax, or
(2) such interest has suffered foreign tax, directly, by way of withholding or otherwise, lower than 5%.
Tax refunds on passive royalties income
Shareholders of IP holding companies receiving passive interest income benefit from a 5/7ths refund of Malta tax suffered by such IP holding company, effectively a refund of 25% (see tax computations below).