The definition of shipping activities is given in the law as “the international carriage of goods or passengers by sea or the provision of other services to or by a ship as may be ancillary thereto or associated therewith including the ownership, chartering or any other operation of a ship engaged in all or any of the above activities or as otherwise may be prescribed”.Ĭonsequently, given all the above conditions are satisfied, no further tax (besides the Tonnage Tax) will be chargeable on profits generated by the shipping organisation through shipping activities. In order for a company to benefit from this tonnage tax regime, it must be registered as a ‘ shipping organisation’ and such activities must be provided for in the company’s constitutive documents.Īny ship of any net tonnage, which is engaged in shipping activities can qualify for this beneficial tax regime, excluding only the following:- fish factory ships, private yachts and ships used primarily for sport or recreation fixed offshore installations and floating storage units non-ocean going tug boats and dredgers ships whose main purpose is to provide goods or services normally provided on land stationary ships employed for hotel and or catering operations (floating hotels or restaurants) ships employed mainly as gambling and/or casinos (floating or cruising casinos) and non-propelled barges.įurthermore, such tax exemption is limited solely to the company’s income arising out of Shipping Activities, therefore it is important that Shipping organisations keep distinct accounts for their shipping activities and ancillary related activities. Such treatment of commercial vessels in Malta helps reduce significant expenses on the operational costs of the vessel. This tax regime exempts any income derived by a licensed shipping organisation that owns, charters or operates a tonnage tax ship from being liable to pay any income tax in Malta. ![]() The taxation system in Malta is based on the tonnage specifications of the vessels, meaning that income arising from the operations on eligible vessels would be calculated by means of a tonnage tax system. Once registered under the Malta flag, Commercial vessels shall abide by the Commercial Yacht Code 2020, developed by the Merchant Shipping Directorate of Transport Malta, which came into force on the 1 st January 2021. The Certificate of Compliance is subject to renewal every five years, which is to be issued upon a renewal survey carried out by an Appointed Ship Surveyor or by a Recognised Organisation. Furthermore, commercial vessels must undergo a specific commercial survey and be granted with a Certificate of Compliance in order to be registered permanently under the Malta flag. To register a commercial vessel in Malta one is to follow a standard procedure for yacht registration in Malta. ![]() Apart from yacht registration being a fast and straightforward process, registering commercial vessels in Malta can be considered very advantageous due to the Maltese favourable tax system, offering special treatment for yachts used for commercial purposes.īy definition, commercial vessels are vessels engaged in commercial operations, which do not carry cargo or more than 12 passengers, and have a minimum overall length of 15 meters.
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