ITS - International Tax Structures

ITS - International Tax Structures

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  • Joe Vassallo Gatt
    Joe Vassallo Gatt
    The company name is only visible to registered members.
    Malta Companies & PIFs
    The benefits of registering a company in Malta are:

    • the tax advantages (5% for non-resident shareholders)
    • membership of the European Union
    • excellent telecommunications
    • legislative framework in line with EU directives.

    By exploiting the tax advantages and other facilities in Malta, companies and individuals who are involved in international trade, could derive great benefits by relocating their trading activities to originate from Malta.

    FUNDS IN MALTA

    Malta is fast becoming a very popular jurisdiction in which to register funds of various types.

    Below is a very brief introduction regarding one type of fund that is available, namely the
    Professional Investor Fund (PIF).

    The Investment Services Act, allows for the setting up of a variety of retail collective investment schemes both UCITS and Non-UCITS together with funds for professional investors, more commonly known as PIF’s. Various structures are also possible, from a stand alone type of fund to multi-funds and multi-classes, whether open-ended or closed-ended.

    PIF’s (PROFESSIONAL INVESTOR FUNDS).
    Professional Investor Funds (PIF’s) are collective investments schemes designed for professional and high net worth investors aggregated under the term ‘authorised investors’. There are three categories of PIF’s depending on the experience of the targeted investor.

    a) PIF’s targeted to Experienced Investors must have a minimum entry level of EUR15,000 or FC equivalent.
    b) PIF’s targeted to Qualifying Investors must have a minimum entry level of EUR 75,000 or FC equivalent.
    c) PIF’s targeted to Extraordinary Investors must have a minimum entry level of EUR 750,000 or FC equivalent.

    Alternative Investment Funds, such as hedge funds, private equity funds and property funds, are set up in the form of PIFs, which by their nature are different from a normal retail fund, in that they are regulated by specific rules relating to their establishment, management and marketing.
    In most cases, a PIF would take the form of an incorporated open-ended or closed-ended investment company, but can also be set up as a limited partnership or a unit trust.

    TAXATION OF COLLECTIVE INVESTMENT SCHEMES
    In terms of current legislation, “non-prescribed” collective investment schemes / funds licensed under the Investment Services Act, 1994 as amended in 2002, are exempt from Malta income tax on any income and capital gains. In general terms, a non-prescribed fund is one which would possess 15% or more of the portfolio invested in assets not situated in Malta.

    Capital gains realised by investors who are non-resident of Malta are not subject to tax in Malta.

    Should you require any further information please contact me
    • 11 Mar 2010, 4:46 pm