Basically, Malta has a progressive tax system of personal taxation, with tax rates ranging from 0% to 35%. The higher the income, the higher the tax rate will be. Persons who are ordinarily resident and domiciled in Malta are subject to income tax in Malta on their worldwide income and certain capital gains.
An individual is considered a tax resident in Malta if they spend more than 183 days in the country in a calendar year. If an individual spends less than 183 days in Malta, they may still be considered a tax resident if are “domiciled” in Malta.
Dividends are taxed at 8.75% (basic rate), 33.75% (higher rate), and 39.35% (additional rate).
The standard VAT rate is 18%.
Companies are subject to tax in Malta at the standard corporate tax rate of 35%.
The TDS on Fixed Deposit is 10% if your interest for the entire financial year exceeds Rs 40,000 for the Assessment Year (AY) 2024-25. If you do not provide your PAN Card to the Bank, the TDS on FD interest will be 20% or the maximum marginal rate according to existing Income Tax rules.
According to the Maltese laws, there are no inheritance taxes in this country. Considering an inheritance can also take the form of a donation, it is also useful to know that there is no gift tax in Malta either.
Passive royalties are taxed in Malta as part of the company's income at the rate of 35%. However, upon the subsequent distribution of income as dividend, the shareholder may claim a refund of 5/7ths of the Malta tax paid by the company, thus reducing the effective tax paid in Malta to 10%.
Malta imposes a rate of maximum 10% withholding tax on royalties, but royalties can also be tax-free, as a part of the double taxation treaties signed by Malta with several states (associated companies that belong to the European Union's space are exempted from the payment of the withholding tax).
The main taxes on real estate in Malta are paid when signing a sale and purchase contract. The tax rate for buying real estate ranges between 8 and 15% of its value. There is no annual property tax in Malta, but in some cases, you need to pay tax on land.