Malta Back Office Operations

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December 03 08:44 2015 by The Editor Print This Article

Back Office Operations

The Concept
The Maltese authorities encourage the setting up of foreign operations that offer back office administration and support services to other foreign enterprises.
Back office services include routine administrative and clerical service in relation to or in support of any type of business or professional activity.
Qualifying activities may include the processing and recording of invoices, sales transactions, and accounts management information reporting. Any routine or administrative tasks that is carried out in support of any business or professional activity pertaining to a financial services concern may be hived off or out-sourced in a way as to qualify as a back office activity as required by the MFSC. Financial services activities include banking, insurance and investment services.
Back office activities could therefore include such a diverse range of administrative tasks and routine services such as form-filling work in support of trust services, shipping and maritime trade, processing and filling of insurance claims forms, repetitive administrative work involved in fund administration business and other professional services. In other words, generally any routine administrative, basic book-keeping and analogous administrative support services.
This incentive is applicable to a wide sphere of activities as back office services are widely defined as “routine administration services”, with unlimited application to any business or professional activity.
There are no restrictions as to the type or nature of the back office services that may be accepted for the purposes of this tax benefit. Thus it is possible for the entrepreneurial and professional class to identify activities which could be classified as the provision of back office administrative or support services.
The services may be, for example, in support of companies engaged in airlines, hotel or hospitality industry, or administrative tasks in support of trust services, shipping and maritime trade, insurance or fund administration business. Indeed most administrative tasks can be out-sourced in a way as to qualify as a back office activity for purposes of law.
  • Low rate of tax for back-office ITCs
  • An extensive range of double taxation agreements which supports effective tax planning.
  • Training grants for approved programs are offered to employees and management.
  • Factory and office space is available at low rental costs.
Malta is in a good position to encourage local set-ups of this nature because of a well-educated workforce and its high number of professionally qualified and trained personnel.

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