Umbrella Company Malta

About Umbrella Company in Malta

Independent contracting in Malta isn’t as straightforward as some people might hope. You’ve got immigration issues, tax compliance, and an array of complex administrative details. 

Before you consider taking a contract in Malta, you should be aware of what you’re getting into – and how you can make it simpler.  This is where umbrella company services in Malta have value for contractors and hiring companies.

Umbrella Company Malta
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Contracting with an Umbrella Company Malta

There are two key benefits of using an umbrella company in Malta: visa sponsorship and tax calculation.  Taking these on DIY is more than most contractors can easily manage.

Visa Sponsorship

Generally, you need to have an employer sponsor to secure the appropriate work permit and visa for Malta.  But contractors often don’t have this option, unless their client is offering to be the sponsor.

But if you’re working independently, it can be difficult to find clients willing to sponsor you. Moreover, even if your client can do this, you’ll need a new sponsor each time you decide to take on a new contract. 

When you contract through an umbrella company, they become the visa sponsor for you.  They can do this because they are a valid registered entity in Malta. And the best part is that if you switch clients, you remain on the same work visa with the umbrella company.

Tax Calculation

Are you deeply familiar with the intricacies of the tax system in Malta, as well as your own country’s laws on overseas earnings? 

If you’re like the rest of us, figuring out (much less reducing) your tax liability in Malta and your home country can be daunting.  This is another key role the umbrella company fills, as they will calculate your income tax, and withhold the right amount.

The umbrella company can also advise you on double taxation treaties with your home country, to minimise overseas taxes.  They will let you know your tax residency status, and how that affects your tax rates.

How Umbrella Companies in Malta work

International contractors are aware they have more challenges than many workers.  From taxes to immigration to secure payments, if you are contracting abroad each of these are critical.

Most freelance workers aren’t experts who successfully tackle these issues all on their own. There are companies that specialise in helping workers make the most out of their contracts.

They’re called umbrella companies (or, contractor management companies).  Malta umbrella company formation originated from the need for an intermediary and ally for contractors just getting started.  They are ready to help you at every stage of your contracting journey.

How do they work?

An Umbrella Company Malta acts as your de facto employer, even though you maintain your independence as a contractor. They collect and filter payments from your clients, withholding out the necessary taxes, social security and fees. 

You send them your timesheets or project specifics, and they send you payments.  It couldn’t be any simpler.

Facilitating Client Payments

The umbrella company acts as an intermediary between you and your client.  The client forwards the agreed contract rate each month to the umbrella company, who then withholds taxes and social contributions.  You receive a payslip and net payment to your designated account.

Visa Sponsorships to Work in Malta

Because they act as your “employer,’ they can sponsor you and provide a single work permit for multiple contracts.  Getting a self-employment work visa in Malta may prove to be too big an obstacle to overcome on your own.

Tax Advantages of Umbrella Companies in Malta

Even better, they have experts in Malta tax law, meaning they’ll also help you optimise your earnings.  They will calculate and withhold the correct taxes at the applicable rates, so you don’t have to.

Contractor Management Tasks

Although the umbrella company is technically your “employer,” you’re essentially freeing yourself to work even more independently. You still dictate your contracts, your hours and your schedule. The umbrella company simply handles the time-consuming administrative and immigration issues, allowing you to focus on your new contract.

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How we help with Umbrella Companies in Malta

There’s a huge variety of Umbrella Companies out there; they all have different specialities and advantages.?  Choosing the right umbrella company Malta is easy with Contractor Taxation.

We work closely with Umbrella Companies throughout Malta and match contractors with the right company for them. If you’ve already secured a contract in Malta, we can help you find your best match (for free). Or, we can simply give you feedback on your situation.  Please let us know your questions, and take a look at some common contractor inquiries below.

More about Contracting in Malta

Is an umbrella company legit?

The umbrella companies that we refer to you are all verified legal entities in the country, with deep experience hiring foreign contractors.  They are as ‘legit’ as any other registered business entity, with an excellent track record

What does an umbrella company do?

An umbrella company hires foreign contractors who need visa sponsorship, client/payment management and compliant tax calculation.  The umbrella company is a de facto employer for the contractor administering all details, while the contractor fulfils their client work obligations.

How much do you lose through umbrella company?

While umbrella companies do charge a monthly fee, it is unlikely that the contractor loses anything from the relationship.  All one has to do is compare the cost with DIY visa applications, getting tax advice, self employment registration and risk of employee misclassification.

What are the disadvantages of an umbrella company?

The primary disadvantage would be for a contractor with their own limited company.  Because they are hired directly by the umbrella company, they will not be able to claim as many business deductions.  This could result in higher net income and taxes.

How do I legally create an umbrella company that will house all my school businesses under it, instead of creating and registering several LLC?

Why go to the time and expense of creating your own umbrella company?  You are better off using one of our experienced entities already in place and ready to serve your needs.

How can I find a job in Malta?

Some contractors will just show up in Malta and hope to network for a job.  But if you prefer, you can use various online contractor job boards and narrow the search to Malta.  You can also use recruiters in your field to send you current opportunities.

How do I set up a foreign owned company in Malta?

If you are going to work for Maltese clients you are better off using an umbrella company.  Setting up a foreign owned company simply to work in Malta is an expensive and time consuming option.

How does an umbrella work in Malta?

It works the same as in any country, stepping into the shoes of an ‘employer’, while allowing you to work for offshore companies.  There are no special requirements for you or your client.  The umbrella company will walk you through each step from the initial contract to hiring and payment.

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