Estonian Company Run from Malta: Tax Rules

Many people living in Malta form or buy an Estonian private limited company (OÜ), often as e-residents, and run it from Malta. The Maltese Income Tax Act looks at where a company is controlled and managed: a body of persons whose business is controlled and managed in Malta is resident in Malta. A person who is not ordinarily resident or not domiciled in Malta pays tax on income arising outside Malta only on the amount received in Malta. The controlled foreign company rule applies to companies taxed in Malta. And the Estonia–Malta tax treaty leaves a company resident in both countries to an agreement between the two tax authorities. This guide sets out these rules with the official texts, and what we do on the Estonian side.

The guide is general information, not tax advice. How your company and you are taxed depends on the facts of your case; ask a Maltese tax adviser before you form or buy the company. We read the Income Tax Act (Chapter 123) and the European Union Anti-Tax Avoidance Directives Implementation Regulations (Subsidiary Legislation 123.187) in their English versions on legislation.mt, the official legislation portal of Malta, and the Estonia–Malta tax treaty in Riigi Teataja, on 22 October 2026.

In Estonia: an Estonian company is Estonian

A company established under Estonian law is resident in Estonia for tax purposes (Income Tax Act § 6). Its profit is taxed when it is distributed, not while it stays in the company — the guide how Estonia taxes company profit explains the rule. The company keeps its Estonian duties wherever its owners live: accounts, an annual report to the commercial register and, if its address is abroad, a contact person in Estonia.

In Malta: the company side

Resident. "Resident in Malta", applied to a body of persons, means any body of persons the control and management of whose business are exercised in Malta (Income Tax Act, Chapter 123, article 2).
What is taxed. Income tax is payable on the income of any person accruing in or derived from Malta or elsewhere, whether received in Malta or not — but in the case of income arising outside Malta to a person who is not ordinarily resident in Malta or not domiciled in Malta, the tax is payable on the amount received in Malta (article 4(1) and its first proviso).

An Estonian OÜ is a body of persons for this rule. If you live in Malta and control and manage the company's business from there, Malta can treat the company as resident in Malta. How the company is then taxed — including whether it counts as domiciled in Malta — is a question for your Maltese tax adviser.

In Malta: the owner side

Controlled foreign company. The rule applies to companies and other entities taxed in Malta as companies (S.L. 123.187, regulation 2(2)). An entity is a controlled foreign company when the taxpayer, alone or with its associated enterprises, holds more than 50% of its voting rights or capital or is entitled to more than 50% of its profits, and the corporate tax it actually pays is lower than the difference between the Maltese tax and that tax (regulation 7(1)).
What is included. The taxpayer includes the entity's non-distributed income from non-genuine arrangements put in place for the essential purpose of obtaining a tax advantage (regulation 7(2)), unless the entity's accounting profits are no more than 750,000 euro and its non-trading income no more than 75,000 euro, or its accounting profits are no more than 10% of its operating costs (regulation 7(3)).

The rule is written for companies. How an individual owner living in Malta is taxed on dividends from the company is a question for your Maltese tax adviser.

The Estonia–Malta tax treaty

A company resident in both countries. The competent authorities shall endeavour to settle the question by mutual agreement; without agreement, the company is not considered resident of either country for treaty benefits (Convention signed in Tallinn on 3 May 2001, Article 4(3)).
Dividends from Estonia. Estonian tax on dividends paid to a resident of Malta who is the beneficial owner may not exceed 5 per cent of the gross amount if the owner is a company holding directly at least 25 per cent of the capital, and 15 per cent in all other cases (Article 10(2)(a)).
Directors' fees. Fees for a member of the board of a company resident in the other country may be taxed in that country (Article 16).
Income taxed when remitted. Where the other country taxes income only by the amount remitted to or received in it, the treaty relief applies only to the amount remitted or received (Article 26(1)).

Whether the Multilateral Instrument changes these articles is a question for your Maltese tax adviser. We do not give that ruling.

What to decide before you form or buy the company

Where the company is controlled and managed. Control and management exercised in Malta make it resident in Malta under article 2.
Who owns the company. A company taxed in Malta holding more than 50% brings in the controlled foreign company rule.
How you take money out. A dividend, a board fee and a salary fall under different articles of the treaty.

What we do on the Estonian side

online formation for an e-resident — €950 Registered address and contact person service for one year are included., or formation by power of attorney — €1,250;
a ready-made company bought remotely — €1,200 Registered address and contact person service for one year are included.;
accounting — from €150 / month and the annual report — from €450;
the registered address and contact person after the first 12 months — €350 / year.

Our accounting covers the Estonian company's Estonian obligations. Maltese tax returns and Maltese tax advice are not included. Owners in other countries: Estonian company run from abroad compares the rules side by side.

The two company forms side by side — members, capital, paying up, share transfer and the company tax: Estonian OÜ or Maltese Ltd.

Prices exclude VAT. All communication takes place by email.

Ready to start? A new Estonian company — online for e-residents or by power of attorney; Maltese tax advice is not included. Order.

Official sources

The laws this article names, by the name of their official text, as read on 9 October 2026. For the Estonian acts we read the English translation in Riigi Teataja; the legally binding text is the Estonian one.

Income Tax Act — Riigi Teataja, English translation

Sources are named in the text, without links. To see which of our services your company needs, open the Business Navigator.

Frequently asked questions

Is my Estonian company taxed in Malta if I run it from Malta?

It can be. Malta counts a body of persons as resident in Malta when the control and management of its business are exercised in Malta (Income Tax Act, Chapter 123, article 2). In Estonia the company stays resident because it was established under Estonian law (Income Tax Act § 6). Under the Estonia–Malta tax treaty, the two tax authorities try to settle the residence of a company resident in both by mutual agreement; without agreement it gets no treaty benefits (Article 4(3)). The Maltese controlled foreign company rule applies to companies taxed in Malta (S.L. 123.187, regulation 7). Ask a Maltese tax adviser before you form or buy the company; we handle the Estonian side.

Estonian company run from Malta: what is taxed where