Malta has invariably become a very attractive jurisdiction for the registration of vessels, and some very attractive tax breaks have been created over the years in order to attract international clients utilising the Maltese flag for their operations.
The departing point for the advantageous tax regime applicable to vessels is that profits earned from the operations of vessels in the transport of goods and persons, including the chartering thereof, are exempt from income tax in Malta, provided the vessel operating is a tonnage tax ship weighing at least one thousand (1,000) net tonnes.
To this effect, it is a customary structure to have a Maltese company own a tonnage tax ship also flagged in Malta. However, Maltese tax law extends this tonnage tax exemption to ships owned by Maltese companies/partnership/trusts/foundations and registered within other EU or EEA members states, or else foreign companies/partnerships/trusts/foundations owning a tonnage tax ship having the latter vessel registered in Malta.
Such exemptions are further extended to licensed shipping organisations engaged in the administration and management of tonnage tax ships.
• Blanket tax exemption on profits earned by “tonnage tax” ships
• Maltese law allows cross-registration, and foreign companies flying the Malta flag to benefit from tax exemptions.
• Maltese companies with foreign EU/EEA vessel registrations may benefit from the relative tax exemptions.