Incorporate in Estonia, Residence in Malta

[JustAnotherNomad]

Dividends will always first be taxed in Estonia, then potentially a second time somewhere else. The way they do that is that it’s officially not a tax on dividends, but a deferred corporate income tax. Estonia is not a tax haven.

 

[lonizzita]

Dividends will always first be taxed in Estonia, then potentially a second time somewhere else. The way they do that is that it’s officially not a tax on dividends, but a deferred corporate income tax. Estonia is not a tax haven.
[/CITAZIONE]

yes, I understand, so they will be taxed in Malta only in the case above 35k, The Remittance Basis

quite right?

 

[JustAnotherNomad]

If you work from Malta, the income will probably be considered as locally sourced and subject to Maltese tax. But I don’t know a lot about Malta. This setup just doesn’t seem like a very good idea to me.
Why do you want to move to Malta?

 

[lory]

Rent an office and hire a few locals in Estonia (approx 50K a year) to make the company "sufficiently" managed and controlled from Estonia. Then it will work.

is that really required. If you have to spend 50K you will need to have a big business there otherwise it looks like not making much sense.

 

[Dandyline]

Just have company and residency in Estonia and live in Malta without visa. If you are EU citizen of course.

 

[lonizzita]

Just have company and residency in Estonia and live in Malta without visa. If you are EU citizen of course.

do you intend to also take personal residence in Estonia and remove the Maltese one?

 

[biz1]

Why don't you simply set up your business in Malta? Normally a Maltese company that owns a Maltese company in Malta will only have like 5% total corp tax rate.. isn't there a way to make it 5% total here, no additional personal taxes for the Maltese resident?

Also, with your suggested Estonia setup, if you would spend 179 days a year operating that business from Estonia and have 183 days a year vacation in Malta, I'm thinking the classification that the Estonia business "would be taxed in Malta too" should not apply, though not sure - anyone thouhgts?

This is an excellent solution until you find out that Malta and Estonia have a bilateral DTA agreement where they specify slightly different conditions.

Ask the Maltese tax office about it for a definitive answer, but unless the EE company is controlled and managed from Estonia, the agreement allows Malta to tax the Estonian company as if it were their own.

Rent an office and hire a few locals in Estonia (approx 50K a year) to make the company "sufficiently" managed and controlled from Estonia. Then it will work.

Tax Cow, what in the Estonia-Malta DTA is it you are thinking of, is there some company tax residency clause in there, what does it say?

Anyhow off hand I don't understand why Estonia is needed at all if you're going to Malta anyhow, which has good structural options already.

 

[Martin Everson]

I think people are overthinking the issue. If he moves to Malta just stay below the CFC threshold and declare everything.