Malta Company Tax System
Malta’s tax system is designed to:
promote international investment in Malta;
support actively the development of financial services in Malta
ensure that company profits are not taxed twice - i.e. at company and again at
Under Malta’s tax system, a company is considered resident if it is incorporated
in Malta or, in the case of a foreign body of persons, if its control and
management are exercised in Malta.
All companies pay 35% on chargeable income; however tax paid by the company is
then imputed to the shareholder in the event of a dividend distribution. As
Malta operates a full imputation system, there is no withholding tax on
Tax Imputation System & Tax
Upon distribution of dividends, shareholders will be entitled to a refund of a
part or whole of the tax paid by the company on the profits out of which the
dividends were paid.
The amount of the tax refund is set at 6/7ths of the tax paid by the company
(5/7ths in the case of passive interest and royalties). This refund will be
reduced where the distributing company would have claimed double taxation
Personal Taxation of
The resident shareholder will be taxable for the total amount of net dividend
and refund received. The non-resident shareholder is not taxed in Malta.
When dividends received from a participating holding are distributed by a
Maltese company to its shareholders such shareholders are entitled to claim a
refund of 100% of the tax paid on the distributed profits.
With regard to acquisitions of participating holdings made on or after 1 January
2007, where the non resident company, having mainly passive income, is not
resident or incorporated in an EU Member State or is subject to tax at a rate
which is less than 15%, the following additional conditions must be satisfied:
Resident individual shareholders will be subject to Malta tax on the dividend
and tax refund while non-resident shareholders and resident corporate
shareholders in receipt of the dividend and tax refund will not be subject to
As from 1 January, 2007 a participation exemption has also been introduced. This
exempts dividends derived from participating holdings and gains derived from the
disposal of such holdings. The participation exemption is also subject to the
anti-abuse provisions described above for participating holdings. Where the
participation exemption applies obviously the refund system in respect of
participating holdings will not apply.
If the conditions to qualify as a participating holding or for the participation
exemption to apply are not met the normal general tax system including the
normal tax refunds will be applicable.
of Malta Companies
Redomiciliation of companies
Virtual office services
Confidential shareholding services through our licensed Nominee Company
Bank account opening & admin services, credit facilities & project finance
Company secretarial service
Book-keeping, Accounting & Audit services
Location of commercial property/office space on sale or for rental
detailed information, please contact our Formations Team [contact