Malta TaxesLast partial update, July 2022.
- In Malta The taxation of an individual's income is progressive.
In other words, the higher an individual's income, the higher the tax he pays.
The rates of tax for an individual in 2022 are 15% - 35%.
There are reduced rates of taxes for certain income earners.
- The rate of corporate tax in 2022 is fixed at 35% with participation exemption applying for dividends and capital gains.
There are reduced rates for certain companies.
Malta Income Tax for an Individual
- An individual who is a Maltese Resident pays tax on his income as a wage earner or as a self-employed person.
A person who meets the criteria of a "permanent resident" (usually, a stay of more than 183 days a year) will be taxed on his income in Malta and overseas.
A foreign resident who is employed in Malta pays tax only on the income he earns in Malta.
- An employer is obligated to deduct at source, each month the amount of tax payable on a wage.
- Certain payments are deductible from the taxable income of an individual that are allowable for tax purposes.
- Separate calculations - A couple each with separate sources of income may report separately on their income, however one of the couple must be nominated as "the representative partner" for the purposes of the tax authorities.
- Passive income, such as rental of an asset, is attributed to the one of the couple having the higher income.
Malta individual income tax rates 2022 (single resident):
|Tax base (EUR)||%|
|60,001 and over||35%|
Reporting Dates for an Individual in Malta
- The tax year is the calendar year ending on December 31.
- The date for filing an annual return is August 30.
- During the year, a self-employed person must make 3 equal advance payments on April 30, August 31 and December 31.
The advance payment is based on the taxable income for the previous year.
- Should there still be tax payable, it should be paid by the August 31 following the end of the tax year.
- An employed person whose employer has deducted monthly tax from his salary is not bound to file an annual return.
Nevertheless, an employed person must submit a declaration by June 15.
- A similar declaration must be filed by an individual in respect of his income from a pension, dividend from a local corporation, and income from an investment in respect of which tax of 15% was deducted at source.
Reporting and Payment Dates for a Limited Company in Malta
- The date for submitting a report is June 30.
In practice, a report may be submitted up until September 30.
- Advance payments for a company are on the dates and in the amounts specified for an individual.
- Annual tax differentials must be paid by September 30.
Malta Corporate Tax
- Malta Corporate tax in 2022 is 35%.
- A company is resident if incorporated in Malta.
Companies not incorporated in Malta but having their business management in Malta are regarded as resident too.
- There is no obligation to deduct tax at source from a dividend paid to foreign residents.
There is zero withholding tax on interest and royalties paid to foreign residents.
- Passive or capital income from a "participation holding" have participation exemption.
- "Participation Holding" is defined in general for holding of 5% or more in a non-resident entity, subject to some alternative tests.
Malta Deduction of Tax at Source (non-resident companies)Malta tax rates for deduction at source:
- Dividends- 0%.
- Interest- 0%.
- Royalties- 0%.
- Technical fees-0%.
Note: The information in this site is for general guidance only. Users of this site are advised to take professional advice before taking practical tax decisions.
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