Reduce withholding taxes. Eliminate double taxation. Build an EU structure that actually works in practice.
Malta is not just another EU jurisdiction with treaties on paper. It is a fully integrated tax platform where:
- double tax treaties work in real transactions
- profits can flow efficiently across borders
- distributions can be made tax-efficiently, without additional charges
If you are building a holding, IP, or trading structure, this is where the difference becomes tangible.
Why Malta Works
Most jurisdictions offer treaties. Few combine them with a system that actually delivers outcomes.
Malta does:
- 70+ Double Tax Treaties in force
- EU Member State with full regulatory credibility
- 0% withholding tax on outbound dividends (in most cases)
- ~5% effective corporate tax via refund system or paid straight
- Access to Participation Exemption for holdings
- Optional Fiscal Unit for group-level tax efficiency
This is what allows Malta to function not just as a company location – but as a cross-border structuring hub.
How Double Tax Treaties Work in Your Structure
At a practical level, Malta treaties allow you to:
- Reduce or eliminate withholding tax on inbound payments
- Avoid double taxation via tax credits
- Secure predictable tax treatment across jurisdictions
Typical impact:
- Dividends → reduced WHT (often 0%)
- Interest → reduced WHT (often 0%)
- Royalties → reduced or 0% WHT
Then:
- Income arrives in Malta efficiently
- Tax is optimised at company level
- Profits are distributed without additional withholding tax
That’s the full cycle.
Ready Structuring Scenarios
Malta Holding Company
For dividend flows, exits, and ownership centralisation
When this works best: You own operating companies in multiple countries, plan dividend repatriation or future exits and are searching for a clean EU holding structure.
How the structure performs:
- Dividends received under treaty → reduced or no WHT
- Participation Exemption → 0% tax in Malta (if conditions met)
- Exit (sale of shares) → potentially tax-free
Practical example:
A group holds subsidiaries in Germany and Poland.
- Dividends flow to Malta with reduced WHT
- Malta holding applies Participation Exemption
- Profits accumulate tax-efficiently
- Distribution to shareholder → no Malta WHT
Outcome: clean, scalable, EU-compliant holding platform.
Malta IP / Licensing Company
For software, SaaS, brands, and royalty flows
When this works best: Your business generates IP-driven income, you operate across multiple jurisdictions and want to centralise IP ownership
How the structure performs:
- Royalties paid to Malta under DTT → reduced or 0% WHT
- Income taxed in Malta:
- ~1.75% effective rate (if IP Box applies), or
- ~5% fallback via refund system
Practical example:
- German operating company pays royalties to Malta IP company
- Treaty eliminates or reduces German WHT
- Income taxed efficiently in Malta
- Profits distributed without further withholding
Critical insight: Most founders focus on qualifying for IP Box. Smart structures plan the fallback (5%) from day one.
Malta Trading / Operating Company
For e-commerce, services, and international trade
When this works best: you invoice globally, you work with suppliers/customers in multiple countries and you need banking-friendly EU presence.
How the structure performs:
- Active trading profits taxed at 35%
- Refund mechanism reduces effective tax to ~5%
- Treaty access reduces foreign withholding taxes
Practical example:
- Malta company sells to EU and non-EU clients
- Receives payments without unnecessary tax leakage
- Pays suppliers abroad efficiently
- Distributes profits at shareholder level without WHT
Outcome:
A practical, bankable EU company – not an “offshore workaround”.
Our Approach
We don’t sell “company formation”. We build working structures.
With 1st Step Solution Ltd you get:
- Structure design aligned with your business model
- Clear tax outcome before incorporation
- Coordination of:
- company setup
- VAT, tax registrations
- accounting & compliance
- banking / EMI onboarding support
- One point of contact
What This Means for You
A properly structured Malta company allows you to:
- Receive income from abroad efficiently
- Reduce or eliminate withholding taxes
- Avoid double taxation
- Operate within a respected EU framework
- Scale internationally without restructuring later
If you are considering: a holding structure, an IP company, or an international trading setup, we will map your exact model and show you: expected tax outcome, treaty access, structure diagram, setup timeline.
Contact us to structure it properly from day one.
Full List of Countries with Malta Double Tax Treaties (Ratified / In Force)
Europe & Nearby
Albania, Andorra, Armenia, Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany, Greece, Guernsey, Hungary, Iceland, Ireland, Isle of Man, Italy, Jersey, Kosovo, Latvia, Liechtenstein, Lithuania, Luxembourg, Moldova, Monaco, Montenegro, Netherlands, Norway, Poland, Portugal, Romania, San Marino, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turkey, Ukraine, United Kingdom
Middle East & Africa
Bahrain, Botswana, Egypt, Israel, Jordan, Kuwait, Lebanon, Libya, Mauritius, Morocco, Qatar, Saudi Arabia, South Africa, Syria, Tunisia, United Arab Emirates
Asia-Pacific
Australia, China, Hong Kong, India, Korea, Malaysia, Pakistan, Singapore, Vietnam
Americas & Others
Barbados, Canada, Mexico, United States, Uruguay
When structuring cross-border business or holding international assets, one concept sits right at the core of efficient tax planning: double tax treaties (DTTs). Malta has built one of the most practical and business-friendly treaty networks in the EU – and understanding how it works is essential if you’re advising clients or structuring internationally. We are here to help – contact us now!