Family Business Transfer of Ownership

Introduction on Family Business Transfer of Ownership Incentive The purpose of the incentive is to assist and facilitate family businesses to transfer their business from one generation to the next by providing benefits including governance and fiscal benefits for the better management and organisation within the family and the business.   Duration of the incentive This scheme […]

Written By Stephen Balzan

On January 16, 2017
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Introduction on Family Business Transfer of Ownership Incentive

The purpose of the incentive is to assist and facilitate family businesses to transfer their business from one generation to the next by providing benefits including governance and fiscal benefits for the better management and organisation within the family and the business.  

Duration of the incentive

This scheme will remain ongoing until 31st December 2020.

Eligibility   

This incentive is available to all undertakings registered as a Family Business.  A Family Business is an undertaking as defined in Article 3 of the Family Business Act that is duly registered as a Family Business and holds an updated certificate issued by the Regulator for Family Businesses.

The incentive

The incentive consists of a reduced rate of stamp duty on the following transfers:

  1. Stamp duty payable on the transfer of immovable property that had been used for a period of at least three (3) years;
  2. Stamp duty payable on the transfer by an individual of shares or interest in a partnership, trust or foundation to family members.

Duty shall be charged on the first €500,000 of the value of the property transferred at the rate of €3.50 per €100. 

With respect to the transfer of shares or interests in a partnership, a trust or a foundation held in a family business which carries on a business, no account shall be taken of the first €150,000 or such other greater amount as may be prescribed of the value of shares, or interests in a partnership, trust or foundation transferred.  

In line with the De Minimis Regulation, the total amount of de minimis aid granted to a single business shall not exceed the amount of €200,000 over any period of three (3) consecutive fiscal years.

De minimis aid 

The total value of de minimis aid granted to a single undertaking may not exceed the amount of €200,000 over any period of three consecutive fiscal years.

How can we help?  

For further information, please contact one of the firm’s tax partners, Stephen Balzan on [email protected] or Elaine Camilleri [email protected]. ACT can help you understand the changes to the tax rules and how these can impact your business.  

Apart from its offices in St. Julian’s Malta, ACT operates from a second office in Gozo, which is situated in the capital city of Victoria.  For an appointment in our Gozo office, please call on 00356 21378672 or send us an email on [email protected]. 

Disclaimer: This article contains general information only and is not intended to address the circumstances of any particular individual or entity. ACT, by means of this article is not rendering any accounting, business, financial, investment, legal, tax, or other professional advice or service. This article is not a substitute for such professional advice, nor should it be used as a basis for any decision or action that may affect your finances or your business. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. Before making any decisions or before taking any action that may affect your finances or your business, you should consult a qualified professional adviser. ACT shall not be responsible for any loss whatsoever sustained by any person who relies on this article.