The Seed Investment Scheme (SIS) has been introduced in order to help start-ups raise equity finance.

The Seed Investment Scheme offers incentives in the form of tax credits to individual investors resident in or operating in Malta, who invest in a qualifying Maltese start-up or early stage companies. The scheme offers young entrepreneurs a route to vital funding in the initial stages of their project by effectively minimizing the risk to investors.

Some important points to consider are:

• SIS investors can receive a maximum of €250,000 tax credit in a single tax year,
• A company can raise no more than €750,000 in total via SIS investment.
• Investors can receive up to 35% tax relief in the tax year the investment is made.
• The company seeking investment must be incorporated and based in Malta.
• The company must not have more than 10 employees.
• The company must be no more than three years old.
• The company must have assets of less than €250,000.

Most commercial activities are acceptable for SIS funding, however there are some exclusions:

• Dealing in immovable property, shares, securities and/or other financial instruments; Dealing in goods other than in the normal course of business;
• Carrying on banking, insurance or any other activity covered by the Investment Services Act, the Banking Act, and the Financial Institutions Act;
• Providing legal, accounting or other professional services;
• Activities relating to development of immovable property;
• Receiving royalties or license fees;
• Operating or managing hotels, hostels, guest houses or residential care homes;
• Carrying on activities in connection with the generation of electricity and other energy sources;
• The holding of shares, whether directly or indirectly, in any company which carries out any of the activities listed in any one or more of paragraphs above.

Visit the below link to read further.

Information and image source: