One of the first decisions you will need to make when you are about to set up your business is what legal format you want to operate under. This is one of the most important decisions you need to take at an early stage as it will determine how you will operate your business.
The type of legal format you choose depends on what type of business you will be setting up and what industry sector you will be operating in. In addition, it also depends on the number of people investing money in the new venture.
The possible registration options are:
- Self-employed
- Partnership
- Limited Liability Company (Ltd)
- Cooperative
Business First can provide information on the formalities related to registering your business.
SELF-EMPLOYED
MALTESE AND EU nATIONALS
The commencement of employment for
self-employed persons requires the following:
Registration for Maltese Citizens is to be made via eform by following this link.
For
EU citizens that are already in possession of a Social Security number and an Income Tax
number they require to fill in the Jobsplus Engagement form and the VAT new number registration form. These may be effected either by accessing the
links provided or alternatively applicants can come to Business First office for assistance.
EU citizens who are yet to start Self-Employment must first
apply for a Social Security number and fill in a Jobsplus Engagement form. Once the social security number has been
issued, within 2-3 working days the Income tax number is then generated and
applicants may proceed with the VAT new number registration form. Alternatively, applicants can
come to Business First office for assistance.
What documents do I need to bring with me to register as a self-employed through Business First?
- You will need to get your Social Security Number and Income Tax number (if known);
- A valid Identity Card or Passport
General Provisions
No citizen of the EU or his/her dependant can pursue activities as a self-employed, unless s/he
- is registered as a self-employed person;
- operates from a registered address and satisfies all other requirements that are normally required for a self-employed Maltese national, including all matters relating to registration and taxation; and
- has the ability to support him/herself and such dependents as may be accompanying him/her.
Non-EU Nationals
In respect of third country nationals, an employment licence is required and is only granted in
exceptional cases. In order to qualify for self-employed status, a third country national must meet one or more of the criteria found in the following guidelines.
non-registered Partnerships
The persons wishing to form a partnership are to create a 'Deed of Partnership' through a notary. Once done partners have to be individually registered with Jobsplus as self-employed. For further information click here or submit the application online. Note that in order to make use of the online application, one is required to log in on the Jobsplus portal first. Following that partners are to submit the Registration of a Partnership form including a copy of the Deed of Partnership in order to obtain an Income Tax number. Subsequently the VAT application form has to be filled in by one of the partners; however both partners need to fill in the Partnership Registration form. The partnership can start trading as long as the required permits and registrations have been carried out.
REGISTERED PARTNERSHIPS
The different types of commercial partnerships:
(a) The Partnership En Nom Collectif;
(b) The Partnership En Commandite; and
(c) The Limited Liability Company.
All 3 types of commercial partnerships enjoy a legal personality distinct from that of its members.
Partnership en nom collectif:
Is formed by two or more partners;
Operates under a partnership name;
Has its obligations guaranteed by the unlimited and joint and several liability of all the partners;
The partners will be exposed to a joint and several liability if the partnership does not have enough assets; and
Must have a deed of partnership which is signed and delivered to the registrar before the Certificate of Partnership is issued.
Partnership en commandite:
Operates under a partnership-name;
Must have at least one ‘general partner’ with unlimited liability, and if more than one, the general partners must have a joint and several liability;
Must have at least one ‘limited partner’ with limited liability who agrees to contribute the capital of a specific sum to the partnership;
Has a separate legal personality which is separate and distinct from that of its partners and has its own legal personality;
Must have a capital which may or may not be divided into shares;
Cannot be liable to a debt which is beyond the amount contributed or agreed to be contributed but not yet paid;
The administration of the partnership is vested in the general partner; and
Must have a deed of partnership which is signed and delivered to the registrar in order for the Certificate of Partnership to be issued.
The deed of partnership shall state:
(a) the name and residence of each of the partners;
(b) the partnership-name;
(c) the registered office in Malta of the partnership;
(d) the objects of the partnership, that is to say, whether the objects are trade in general or a particular branch of trade, and in the latter case, the nature of the trade;
(e) the contribution of each of the partners, specifying the value of the respective contribution of every partner; and
(f) the period if any fixed for the duration of the partnership.
LIMITED LIABILITY COMPANY (LTD)
What are the obligations when setting up a company?
When registering as a Limited Liability Company, a business should have the following in place:
- Registered Office
- Objects
- Capital Requirements
- Shareholding
- Directors and Company Secretary
- Meetings
- Company returns and annual accounts
Registered Office: Every company registered in Malta must have a registered office in the Maltese Islands. This may be at your own business premises, the office of a firm of lawyers, accountants or other providers of corporate services. Any changes to the company's registered office must be notified to the Registry of Companies.
Objects: The Memorandum of Association must specify the objects for which the company is set up. The objects may not be simply stated to be any lawful purpose or trade in general.
Capital Requirements: In the case of a private company, the minimum authorised share capital is EUR 1,164.69. The authorised share capital shall be subscribed by at least two persons. The minimum authorised share capital of a public company is EUR 46,587.47.
Shareholding: The maximum number of shareholders for a private company is fifty, whereas there is no maximum number of shareholders in the case of a public company. The minimum number of shareholders is normally two; however a “single member company” may also be registered under the Companies’ Act. A single member company is a private limited liability company, which qualifies as an exempt company and which is incorporated with one member or whose membership is reduced to one person after incorporation. In the case of a single member company, the Memorandum of Association should also indicate the main trading activity of the company.
Directors and Company Secretary: Every public company must have at least two directors whereas every private company must have at least one director. Every company must have a Company Secretary. No company may have as company secretary its sole director unless the company is a private exempt company or as sole director of the company a body corporate, the sole director of which is company secretary to the company. It shall be the duty of the directors of a company to take all reasonable steps to ensure that the company secretary is an individual who appears to them to have the requisite knowledge and experience to discharge the functions of company secretary. The law does not require that the company secretary be resident in Malta.
Meetings: Every company must hold an Annual General Meeting. Every general meeting other than this annual general meeting is called an extraordinary general meeting.
Company returns and annual accounts: All companies must prepare an annual return in the prescribed format to be made up, upon each anniversary of its registration. The return must be filed with the Registry of Companies within 42 days after the date to which it is made up. A payment between EUR100 and EUR1,400 depending on the authorised capital is to be submitted along with the return. Companies are also required to file a copy of the annual accounts. These must generally be accompanied by a copy of the auditors' report thereon, and the directors' report. The annual accounts must be filed within 10 months from the end of the financial year, with a grace period of 42 days. The format of the accounts to be submitted depends on the size of the company. Small companies may draw up abridged balance sheets and abridged layouts of profit and loss accounts. Private companies which on their balance sheet date do not exceed the limits of two of the three following criteria:
- balance sheet total: EUR 46,587.47
- turnover: EUR 93,174.94
- average number of employees during the accounting period stands at 2;
shall be exempted from the requirements concerning auditing of accounts and such companies may draw up abridged balance sheets and abridged layouts of profit and loss account and abridged notes to the accounts.
Registration process
In order to be registered, the company should submit the required documentation to the Registry of Companies(ROC). Additional information can be viewed on the Registry of Companies Guide.
Alternatively you can register directly with the ROC online. First you need to register for an account and install a digital certificate using your local electronic identification (e-ID). For further information on how to use the on-line Registry of Companies and filing services kindly refer to these guidelines. We strongly suggest you use a local practitioner to guide you and register your business online.
What documents do I need to take with me to register my company at ROC?
The Memorandum and Articles of Association of the company duly signed in original by the shareholders or their authorised representatives (in the latter case, including powers of attorney/resolutions as appropriate). It is recommended that you seek an accountant, lawyer or consultant to help you compile this documentation.
Documentary evidence (including expert's report in the case of non-cash consideration) that the paid up share capital has been made available to the company in formation. The Bank advice slip should show the name of the company in formation.
Documentary evidence of identity (copy of passport/official I.D. card) of all individuals involved in the company (directors, shareholders and secretary). In the case of foreign corporate directors or corporate shareholders, a certificate of good standing issued by the foreign company registry is to be submitted.
Satisfactory bank or character references on non-EEA resident shareholders, including on corporate shareholders.
Cheque for registration fees (kindly refer to FAQs for fees). If certified copies are ordered, these are to be added to the appropriate charges.
All documents submitted in copy (not original) are to be certified true copies (i.e. signed as a true copy of the original by a notary/lawyer. ROC may also accept copies endorsed by an accountant/auditor).
Fees
The Registry of Companies is responsible for the registration of companies in Malta. For a whole list of fees charged for registering a company and submitting annual returns. To note that the fee for an electronic format has been updated and is in the link.
Payment of fees can be done directly with the Registry of Companies, manually or online, or through Business First where only cheque payments are accepted. For more detailed information refer to Companies Act (Fees) Regulations 2008.
Additional information can also be accessed through the Registry of Companies Agency or by downloading the Authority’s guide to Registration of Companies.
COOPERATIVES
What needs to be done?
A group of people registering their activity as a co-operative society need to register directly with the Cooperatives Board by filling out and submitting the relevant application form. Together with the application form and the cooperatives’ statute, the cooperative must also submit a business plan to the Cooperatives Board for evaluation. It also needs to inform the Board who the members are by filling out Form B ‘Notification of Members of a Cooperative Society’. All relevant forms, a guideline statute as well as information on the fees involved may be accessed on the Cooperatives Board website. Assistance and guidance on matters relating to co-operatives is also available from Koperattivi Malta and the Malta Cooperative Federation.
Online Application
Company Registration
Employment Engagement or Termination form Note: In order to access the online applications, one is required to login on the Jobsplus portal first.
RESOURCES
Doing Business in Malta
Downloadable forms
Jobsplus Resources (forms)