The tax system in Malta. What to know about it

There is a singularity in Malta: taxes benefits businesspersons and entrepreneurs, and also investors and other individuals who are wishing and wandering for a stable economy where to make business. Although Maltese citizens have to pay income taxes like any other place, with progressive rates (till 35 %), Malta is very attractive to foreign investors.

The colonial past of this region (it was a British colony) set a start point for its tax regulatory system. Things are this way: foreign people who lives in Malta can get a special treatment if they become resident of that country. These individuals are taxable on two kinds of income only:

The first one would be the capital gains and sourced income. It is applicable if you are an employee or when you are selling imported products to Maltese citizens. The second kind is the foreign sourced income.

In addition, foreign residents in Malta do not have to pay any tax related to foreign sourced capital gains, even when they declare these incomes to a Maltese bank.

Malta tax system has other advantages. Stamp duty only have to be paid if Maltese real estate transfers are made, or in case of transfers of shares in Maltese societies.

Opportunities to businessmen and investors in Malta are fabulous. Besides a legitimated and efficient tax regulatory frame, this place offers different residence arrangements to foreign people wanting to relocate it business and changing their lifestyle.

Corporate Malta tax

The tax rate in Malta for corporations is 35 %, and the taxable incomes for enterprises which are domiciled in this country includes the global income and some capital gains.

On the other hand, societies which doesn´t have their residence in Malta have to pay taxes for any income.

Taxable profits are the ones reported in the financial statements of the society, and are adjusted then by deducting exempt incomes and by adding non-deductible expenses.

Corporate income tax is charged on these entities: Partnership, limited liability company —or any other formed as such; fellowships, societies or associations of persons, vested with legal personality or not; and groups of persons constituted, incorporated or registered outside Malta, cooperative societies duly registered as such in Malta.

Either way, Malta is a known as a tax haven, a not very fortunate expression because it suggests that those countries where tax laws are stronger are some kind of hell.