Personal Income Tax

Malta applies the remittance basis of taxation which has been a crucial feature of Malta’s success as financial centre. In accordance with the Income Tax Act a person who is both domiciled and resident in Malta is subject to tax in Malta on its worldwide income. However a person who is resident but not domiciled in Malta is subject to tax in Malta only on Malta source income i.e. income accruing or derived in Malta and on income arising abroad but remitted to Malta. As regards capital gains the same person is subject to tax in Malta only if capital gains arise in Malta. The remittance basis of taxation applies to both individuals and corporate entities.

As of basis tax year 2015, where the spouse is ordinarily resident and domiciled in Malta, then a worldwide basis of taxation should apply for the other spouse. Income is taxable at graduated rates.

Maltese Residents

Tax rates for basis tax year 2016 are as follows:

Single rates (or married couples opting for a separate computation)

Taxable income (EUR) Rate (%) Deduct (EUR)
From To
0 9,100  0 0
9,101 14,500 15 1,365
14,501 19,500 25 2,815
19,501 60,000 25 2,725
60,001 and above 35 8,725

 

Married rates

Taxable income (EUR) Rate (%) Deduct (EUR)
From To
0 12,700  0 0
12,701 21,200 15 1,905
21,201 28,700 25 4,025
28,701 60,000 25 3,905
60,001 and above 35 9,905

 

Parent rates

Taxable income (EUR) Rate (%) Deduct (EUR)
From To
0  10,500  0  0
10,501 15,800 15 1,575
15,801 21,200 25 3,155
21,201 60,000 25 3,050
60,001 and above 35 9,050

 

Non-Malta Residents

The following table should be used by taxpayers not residing in Malta for computing the amount of tax on their chargeable income.

 

Tax rates for basis year 2008 onwards:

Taxable income (EUR) Rate (%) Deduct (EUR)
From To
0  700  0  0
701 3,100 20 140
3,101 7,800 30 450
7,801 and over 35 840