Tax laws Malta
Malta's taxation system is administered by the Commissioner for Tax and Customs and encompasses a variety of taxes, including income tax, value-added tax (VAT), and social security contributions.
1. Income Tax:
Individual Income Tax:
- Residents and Domiciled Individuals: Subject to tax on worldwide income.
- Non-Residents or Non-Domiciled Individuals: Taxed only on income arising in Malta.
- Progressive Tax Rates for Residents (2017):
- Up to €9,100: 0%
- €9,101 to €14,500: 15%
- €14,501 to €19,500: 25%
- €19,501 to €60,000: 25%
- Above €60,000: 35%
- Non-Resident Tax Bands:
- First €700: Exempt
- €701 to €3,100: 20%
- €3,101 to €7,800: 30%
- Above €7,800: 35%
- Note: Married individuals and parents may have different rates and bands.
Corporate Income Tax:
- Standard rate: 35%
- Shareholders may receive tax refunds of 6/7 or 5/7 of the tax paid, resulting in effective rates of 5% or 10%.
2. Value-Added Tax (VAT):
- Standard Rate: 18%
- Reduced Rates:
- 5%: Applies to certain goods and services, including electricity, medical accessories, and specific printed materials.
- 7%: Applies to certain accommodation services.
- Exempt Goods and Services:
- Include exports, international transport, certain financial services, and specific cultural and educational services.
3. Social Security Contributions:
- Employed Individuals:
- Contribution rate: 10% of basic weekly wage, up to a maximum of €42.57.
- Employer contributes an additional 0.3% to the Maternity Fund.
- Self-Employed Individuals:
- Contribution rate: 15% of annual net income, paid in three installments.
- The state contributes half of the self-employed individual's contribution.
4. Other Taxes:
- Import Duties: Payable on goods imported from non-EU countries, with rates depending on the type of good.
- Excise Duty: Applied to certain products like alcoholic beverages, tobacco, and energy products.
- Stamp Duty:
- 5% on transfers of immovable property.
- 2% on certain securities.
- Rates vary for insurance policies.
5. Recent Developments:
- Attractive Residency Programs: Malta offers programs like the Global Residence Programme, providing a special tax status with a flat rate of 15% on foreign income remitted to Malta. A minimum property investment of €275,000 or an annual rent of €9,600 is required.
- No Annual Property Tax: Malta does not impose annual property taxes, council taxes, or inheritance taxes, making it appealing to international investors.
Note: Tax laws and regulations are subject to change. For the most current information, it is advisable to consult official sources such as the Commissioner for Tax and Customs or seek professional tax advice.
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