Sky Bet moves to Malta, reducing UK tax burden
Sky Bet moved part of its operations to Malta, a decision that could reduce its annual tax bill in the United Kingdom by more than £55 million. The move takes advantage of corporate tax benefits and European VAT mechanisms, according to an analysis by Tax Policy Associates released by ITV News.
Sky Bet moves operations to Malta and significantly reduces its tax burden in the United Kingdom
Sky Bet, one of the largest bookmakers in the British market, has reorganized its operational structure by relocating its activity center to Malta, a decision that could result in an estimated tax saving of £55 million per year. The investigation, revealed by ITV News and analyzed by Tax Policy Associates, indicates that the company migrated its business to benefit from more favorable tax rules, although the company assures that there were also “strategic and commercial reasons.”
Sky Bet, now part of the Flutter Entertainment group, conducted its main operation under the British company Hestview Limited, which in 2024 recorded total tax liabilities of £136 million, including corporation tax, VAT on advertising, and the general betting duty. Its sponsorship of the English Football League, valued at £15 million per year, was part of that calculation.
The new operational structure in Malta
Flutter created SBG Sports Limited, a UK company with a branch established in Malta, which functions as the actual operational headquarters, with executive staff based on the island. The firm obtained a license from the Gambling Commission in October; however, it is unclear whether the British regulator was aware of the extent of the relocation.
In the new scheme:
- Sky Bet will continue paying around £75 million in general betting duty for bets placed by British customers.
- But the profits generated by the Maltese branch may be taxed under Malta’s corporate tax, which despite having a nominal rate of 35%, is reduced to an effective rate close to 5% after refunds contemplated in international agreements.
This would reduce the corporation tax from about £39 million to only £8 million annually.
Impact on VAT and possible use of complementary structures
The relocation also changes the VAT taxation on advertising and sponsorships. By now being located in Malta:
- Advertising services acquired in the UK no longer apply UK VAT.
- Malta’s 18% VAT is applied on an annual marketing budget of £132 million, which amounts to £24 million (compared to £26 million under the previous system).
In total, the move represents a minimum tax relief of £29 million, although industry experts suggest that Sky Bet could employ additional structures to further optimize VAT.
Analysts mention a possible “ServiceCo” in countries such as Belgium, Luxembourg, or Ireland, responsible for purchasing advertising services recovering local VAT, then reselling them internally to Malta without additional value-added tax costs.
Regulatory concern over incentives for offshoring
Specialists warn that Maltese tax rules and the European VAT framework will encourage more operators to relocate activities outside the UK, making tax collection and regulatory monitoring more difficult. British lawmakers have previously warned that these strategies create competitive asymmetries and erode the national tax base.
Tags: Malta, iGaming Malta, SkyBet, SkyBet Malta