FAQ: Personal Taxation
Our Frequently Asked Questions (FAQ) provide you with information about personal taxation in Malta.
I am considering relocating to Malta, what tax rates will be applicable to me?
Maltese resident individuals are taxed at progressive rates of tax which fall within three categories, the ‘single’, ‘married’ and the ‘parent’ rates. The highest rate of tax is 35%, which is only applicable to income in excess of €60,000 a year. In addition, Malta offers various types of Residence Schemes that grant the beneficiaries a Special Tax Status.
For more information about these schemes kindly visit the FAQs on Residence in Malta.
Am I allowed any deductions against my taxable income?
Yes, if you are engaged in business activity, you are allowed to deduct all business-related expenses provided these are properly documented. There are also other personal expenses that are deductible for tax purposes, including alimony payments, school fees, and childcare fees and fees paid in respect of tertiary studies.
For more information about both personal and business-related tax deductions, do not hesitate to contact us on [email protected].
Am I entitled to claim relief for tax paid abroad?
Yes, you are entitled to claim a credit for the foreign tax suffered, which is normally set-off against your Maltese tax liability, either by application of the applicable double tax treaty which Malta would have signed with the country in which you have paid tax or by means of provisions found in Maltese tax legislation.
For more information about double taxation relief, do not hesitate to contact us on [email protected].
What income and capital gains will be subject to tax in Malta?
Individuals who are ordinarily resident and domiciled in Malta are taxed in Malta on their world-wide income and capital gains. However, if you are either ordinarily resident or domiciled in Malta you are subject to tax in Malta on income and capital gains arising in Malta and on any foreign income that is remitted to Malta. Non-resident individuals are only subject to tax in Malta on income and capital gains arising in Malta.
For more information about the basis of taxation, do not hesitate to contact us on [email protected].
What tax declarations do I need to file with the tax authorities?
As an individual you need to file an income tax return and pay tax (if any) for each fiscal year (being a calendar year) by June of the following year. Malta’s income tax system is a self-assessment system thus you will be required to declare the taxable income and capital gains (if any) for that particular year in your tax return.
For more information about tax compliance obligations, do not hesitate to contact us on [email protected].
If I relocate to Malta, am I subject to property, capital, wealth, inheritance and gift taxes?
Malta does not impose any property, capital, wealth, inheritance and gift taxes. A tax is however imposed on the transfer of certain capital assets, such as immovable property and shares.
For more information about taxation of capital gains, do not hesitate to contact us on [email protected].
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ACT is a well-known and respected boutique tax advisory firm providing high-quality tax advice to Multinational Enterprises, SMEs including family owned and other owner-manged companies, family offices, trusts, foundations, employees and high net worth individuals.
Maltese companies are subject to tax at the rate of 35% on their worldwide income and capital gains. Malta grants various fiscal incentives to both companies and their shareholders upon the distribution of a dividend.
Malta has recently seen an increase in the number of Electronic Money Institutions (EMIs) looking to set up their operations in Malta. This has been largely due to the growth in the e-commerce and the i-gaming industries.