How to set up a business in Malta

Time to turn your dream idea into reality and set up that business that you’ve always dreamed of? Or maybe you already run a successful business elsewhere and you’ve now set your sights on Malta?

Setting up a business may feel like an overwhelming process if you’re not familiar with bureaucracy and admin. The good news is that it’s actually quite easy to set up a business in Malta, especially if you’re starting small. Here’s a guide to the main steps you’ll need to follow, and how to make them happen.

Step 1: Choose your legal model

Before you launch your business you’ll need to decide what legal model your business will take. The below are the most common options:

• Sole ownership – This works best if you’re a small goods or service provider
• Registered partnership – This is a great choice for small to medium sized businesses that are owned by more than one party. The partnership is drawn up by means of a notarised public deed.
• Limited liability company – This is a more formal business model that comes with a specific set up process. The advantage is that your personal assets will be kept separate from the business accounts. However, should you need to wind up the business the process is more cumbersome.

Step 2: Obtain any permits pertaining to your sector

This one very much depends on your area of business. Some sectors require no permits – content creators and photographers are two examples. Others, such as caterers, tourist guides, architects and so forth need to make sure that they’re properly licensed by the correct authority.

Step 3: Register for a VAT number

Even if you’re a small business and your projections don’t exceed the VAT threshold of €30,000 turnover annually, you will still need to register for a VAT number. However, you can request an ‘exempt’ registration, which means that you won’t need to charge VAT. Be aware that as soon as you reach an annual turnover of $25,000 you’ll need to revoke your exempt status and start charging VAT at 18%.

In Malta there is a list of business and service providers that is actually VAT exempt. You can find whether you qualify on the official government website. Unless you’re a sole trader, you will also need to register for a tax registration number for your business.

Step 4: Set up a meeting with Business First

Business First is the government’s point of contact in this regard. The centre offers full support to all businesses based in Malta and, besides guiding you through the process of setting up your businesses will also inform you about any grants, subsidies or support schemes that you’re entitled to.

Step 5: Register with JobsPlus

You will need to inform JobsPlus of your new status as business owner. Moreover, if you’re employing people you will also need to be registered as an employer so that you can pay your workers’ National Insurance (NI) contributions.

Congratulations! Your business can now go live

Once the above formalities are done and dusted, you’re close to launch! Don’t forget details like applying for a business bank account, setting up your social media platforms and – most of all – enjoying this very exciting phase of your project.