Corporate Structuring: Designing the Foundation for Your Global Success.

1. What exactly is meant by “Corporate Structuring” in an international context?
Answer: Corporate Structuring refers to the legal and tax architecture of your entire corporate group. Rather than treating companies as isolated standalone entities, we design a coordinated network of holding companies, operational establishments (Operating Companies) and specialized IP or asset protection vehicles. The objective is to minimize liability risks, legally segregate operational revenues, safeguard intellectual property, and legally and sustainably optimize the global tax burden within the framework of European legislation.

2. Why does the separation between a holding company and an operational Limited make sense in Malta?
Answer: This classic two-tier structure is the cornerstone of the Maltese tax system. The operational Limited (OpCo) generates profits and taxes them at the standard rate of 35%. Once these profits are distributed to the Maltese holding company (HoldCo) as dividends, the holding company is entitled to a statutory claim for the 6/7 Tax Refund.

This offers two fundamental advantages:

1. The effective tax burden at the operational level decreases to 5 %.

2. The refunded funds flow directly to the holding level, where they are protected from the operational liability risks of the OpCo and are immediately available for reinvestment, crypto investments, or wealth accumulation.

3. What advantages does a Malta Fiscal Unit offer for you? 

Answer: A Fiscal Unit (also known as a Tax Unit) in Malta allows a parent company (HoldCo) and its subsidiaries (OpCos) to be treated as a single taxpayer for income tax purposes under the Consolidated Group (Income Tax) Rules.
In this structure, the parent company acts as the Principal Taxpayer. The subsidiaries are treated as fiscally transparent entities (Transparent Subsidiaries).

Key Advantages
Major Cash Flow Advantage: Under the standard system, a Maltese Ltd initially pays 35% corporate income tax, and the shareholders subsequently claim a 6/7 refund (effective tax burden: 5%). Within a Fiscal Unit, this pre-financing requirement is eliminated: tax is calculated and settled directly at the effective tax rate of 5% via the group's consolidated tax return.

No Dividend Distribution Required: Tax optimization takes effect directly upon assessment, without the need to formally distribute profits or submit refund applications beforehand.
Simplified Reporting: The parent company files only a single consolidated tax return for the entire group. The transparent subsidiaries are not required to submit separate income tax returns.
Neutral Intra-Group Transactions: Transactions between entities within the Fiscal Unit are disregarded for tax purposes.

Key Requirements:
95% Shareholding: The parent company must hold at least 95% of the shares in the subsidiary.
Identical Accounting Reference Date: All participating entities must share the same financial year-end.

Joint and Several Liability: All members of the Fiscal Unit are jointly and severally liable for the tax liabilities of the group.

4. What is the difference between substance on paper and genuine "economic substance"?
Answer: In modern international tax law, the principle of Substance over Form . A lease agreement for a mere co-working desk or a pure letterbox address (Letterbox) is far from sufficient today to establish the tax residency of a company abroad.

Genuine economic substance means that your company in Malta must have adequate physical premises and that key, day-to-day management decisions are demonstrably made in Malta by qualified corporate bodies (such as local directors or yourself following a relocation). We structure your setup from the outset to ensure it withstands international substance scrutiny.

5. How does corporate structuring protect my intellectual property (IP)?
Answer: In an unstructured business, trademarks, software source code, customer databases, and patents are often held directly within the operational company. Should this entity face a liability claim, litigation, or insolvency, your most valuable intellectual property is at severe risk.

Through intelligent corporate structuring, we separate risk from value: intellectual property is legally secured within a separate IP holding entity or foundation and licensed to the operating company for use via professional license agreements at an arm's-length royalty fee. This ensures your core asset remains entirely protected, even in the event of severe crises affecting the operating entity.

6. What do I need to keep in mind if I already own an active operating GmbH in my home country?
Answer: Integrating a Maltese structure into an existing national corporate group after the fact is high-stakes legal surgery. Critical tax pitfalls, such as German exit taxation (Sec. 6 of the German Foreign Tax Act / § 6 AStG) or the deemed realization of hidden reserves (Entstrickungsbesteuerung), must be strictly avoided.

Through structured mechanisms such as a cross-border share-for-share exchange or the establishment of a parent holding structure under the EU Parent-Subsidiary Directive, existing setups can often be internationalized in a tax-neutral manner. We rigorously analyze these avenues in advance as part of our preliminary tax analysis.

7. How does the corporate structuring process work with Dr. Kresse & Partners International Law Firm?
Answer: We do not sell off-the-shelf standard setups. The process is structured into three clear phases:

1. Analysis: We thoroughly examine your current business model, your IP assets, your personal residency plans, and the tax framework of your home country.

2. Blueprint: We draft a customized corporate structure chart, including all contracts, fund flows, and substance requirements.

3. Implementation: Only once the tax assessment is fully definitive do we execute the setup—from incorporating the companies and drafting the intercompany agreements through to establishing the local operating business.