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In this page: Accounting Rules | Tax Rates | Intellectual Property | Legal Framework | Standards | Business Practices

 

Accounting Rules

Tax Year
The financial year starts on 1st January and ends on 31st December of the same year.
Accounting Standards
The account reports need to conform to the norms decreed by the IAS (International Accounting Standards).
Accounting Regulation Bodies
Malta Institute of Accountants
Accounting Reports
The annual accounts should give a clear view of the company's assets, liabilities, financial position and profits or losses. It must comprise: the balance sheet, the profit and loss account, and the notes to the accounts.
Publication Requirements
According to the Companies Act of 1995, all Maltese companies are required to submit their account reports annually, showing correct and honest picture of the volume of the business done along with the justification of the various transactions performed.
Professional Accountancy Bodies
Accountancy Board
Certification and Auditing
The Maltese companies need to appoint one or more than one external auditors for validating the annual account statements which are presented during their annual general meetings. An auditor has to be competent enough to conduct such audits and should confirm to the requirements as given in the Chapter IX of the companies act (Companies Act of 1995). You can contact an external auditor: KPMG, Ernst & Young, PricewaterhouseCoopers and Deloitte.
Accounting News
Business News Portal
IAS Plus

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Tax Rates

Consumption Taxes

Nature of the Tax
Value Added Tax (VAT) - It-taxxa fuq (Local Name)
Tax Rate
18%
Reduced Tax Rate
7% on hotels; 5% on books, medical, newspapers, admission to cultural events; 0% on foodstuffs and pharmaceuticals to countries outside the European Union.
Other Consumption Taxes
Excise duty is applicable on the import of certain products like fuel, vehicles, cigarettes and alcohol. The exhaustive list of products subject to excise duty can be seen on the website of the Customs office.
More detailed information on excise duties is available concerning alcoholic beverages, tobacco products, energy products on the European Commission website.

Learn more about Service Providers in Malta on Globaltrade.net, the Directory for International Trade Service Providers.

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Corporate Taxes

Company Tax
35%
Capital Gains Taxation
Companies are taxed on the transfer of securities, business goodwill, copyrights, patents, trademarks and trade names and on the assignment of ownership rights over such properties.
Main Allowable Deductions and Tax Credits
The legislation provides incentives to qualifying companies that undertake certain target sector activities specified in the law (some manufacturing activities, R&D, production of films etc.). The principal tax incentives provide reduced taxation rates and investment tax credits. Expenses are deductible for depletion and depreciation, net operating losses, payment to foreign associates, some taxes...
Other Corporate Taxes
Stamp duties and social security contributions.
Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 

Country Comparison For Corporate Taxation

  Malta OECD United States Germany
Number of Payments of Taxes per Year 6.0 12.0 11.0 9.0
Time Taken For Administrative Formalities (Hours) 139.0 176.0 175.0 207.0
Total Share of Taxes (% of Profit) 41.6 42.7 46.7 46.8

Source: Doing Business - Last Available Data.

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Individual Taxes

Tax Rate

Income Tax - Single persons or married persons filing separately Progressive rate from 0% to 35%
EUR 0 to 8,500 0%
EUR 8,501 - 14,500 15%
EUR 14,501 - 19,500 25%
EUR 19,501 and over 35%
Allowable Deductions and Tax Credits
Various deductions are allowed:
1/ Certain fees in connection with schools, child care, sports for children specified by the Minister of Finance and fees with respect to a registered private kindergarten.
2/ Donations
3/ Homes for the elderly
4/ Interest paid on money borrowed is deductible from income generated by assets acquired through the application of the loaned funds.
5/ Interest on loans acquired by first-time buyers of immovable property.
6/ Alimony payments (including alimony payments ordered by foreign courts) paid by a taxpayer to an estranged spouse are allowed as a deduction, while the receipt of the alimony is taxable in the hands of the recipient.
No personal allowances are granted under Maltese law.
Special Expatriate Tax Regime
The term 'expatriate' is not defined by the Income Tax Acts. Temporary residents and persons who are neither ordinarily resident nor domiciled in Malta pay income tax on income arising in Malta. A guide to taxation for expatriates can be found at the following website: The Malta Institute of Accountants

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
See the list of double Taxation Treaties
Withholding Taxes
There is no tax on dividends, interest and royalties.

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Sources of Fiscal Information

Tax Authorities
IRD
Other Domestic Resources
Malta Taxation Center
Consult Taxation trends in the European Union.

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Learn more about Taxes and Accounting in Malta on Globaltrade.net, the Directory for International Trade Service Providers.

Intellectual Property

National Organizations
The organization responsible for the protection of brands, industrial drawings and patents in Malta is the Industrial Property Registration Directorate.
Regional Organizations
Malta is member of the UCC (Universal Copyright Convention) since 1968.

 

Malta signed the Convention of Paris for the protection of industrial property, the Convention of Berne for the protection of literary and artistic works and also the Universal Convention of authors' rights.

 

National Regulation and International Agreements

 
Type of property and law Validity International Agreements Signed
Patent
 
Patents Act 2002
20 years
Trademark
 
Trademarks Act, 2001
A trademark is granted for a period of ten years which is renewable.
Design
 
Industrial Designs.
A design right is protected for a period of five years from the date of filling in the application and is renewable for one or more periods of five years up to a total term of 25 years.  
Copyright
 
Copyright Act 2000

 

Protection lasts 70 years after the end of the year in which the author dies, irrespective of the date when the work is made available to the author. WIPO Copyright Treaty
Industrial Models
 
Industrial Designs.
20 years  

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Legal Framework

Independence of Justice
The judiciary in Malta is independent.
Equal Treatment of Nationals and Foreigners
Foreign nationals can expect an impartial trial form the country's judicial system.
The Language of Justice
Maltese and English are the two judicial languages used in the country.
Recourse to an Interpreter
Malta is country's national language. However, English is widely used and considered as a second language. Therefore, the recourse to an interpreter is easy.
Sources of the Law and Legal Similarities
The main source of the law is the constitution of 1964 (amended many times). The country's legal system is based on English common law and Roman civil law (Napoleonic codes). English law has had since the early part of the last century, its fair share of influence on certain areas of criminal law and procedure (for example, the presumption of innocence). Malta being a member of the European Union, the national law in the country needs to comply with the conditions of the community legislation. 
Checking National Laws Online
Malta's main laws online (English and Maltese)

Learn more about Lawyers and Legal in Malta on Globaltrade.net, the Directory for International Trade Service Providers.

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Standards

National Standards Organizations
MSA, Malta Standards Authority
Integration in the International Standards Network
As Malta is member of the European Union, EU legislation in terms of standardization is applied in this field. The organization responsible for defining technical standards is the Malta Standards Authority (MSA).The MSA is an affiliated member of the European Standardization Committee and a member of the International Standard Organization (ISO), of the European Committee for Standardization (CEN), of the European Committee for Electrotechnical Standardization (CENELEC), of the European Telecommunications Standards Institute (ETSI), of the International Electrotechnical Commission (IEC), and of the International Telecommunication Union (ITU).
Classification of Standards
Malta being part of the European Union, all products sold in the country are regulated by specific EU legislation (EU's General Product Safety Directive) as well as to possible additional national requirements. An important feature of EU standards is CE marking which is necessary for products which may pose a health or safety risk.
Online Consultation of Standards
A catalogue of Malta's standards can be found on the Malta Standards Authority website.
Certification Organizations
MSA Malta Standards Authority

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Business Practices

General Information
Chamber of Commerce of Malta
Opening Hours and Days
Shops are generally open from 9.00 am to 1.00 pm and again from 4.00 pm to 7.00 pm. In tourist zones, various shops remain open till 10.00 pm. Shops are normally closed on Sundays and on public holidays.

Bank timings are generally from 8.30 am to 12.30 pm from Monday to Friday and from 8.30 am to 11.30 a.m. on Sunday.

The working hours for public administration offices are: 8.00 am to 4.30 pm during winters and 7.30 am to 1.00 pm in summers (Monday to Friday).

Finally, the companies generally remain open from 8.30 am to 4.00 pm from Monday to Friday.

 

Public Holidays

New Year's Day January 1
St Paul's shipwreck February 10
St Joseph March 19
Good Friday Depending on the dates
Freedom Day March 31
Worker's Day May 1
Sette Giugno June 7
St Peter and St Paul June 29
Assumption August 15
Victory Day September 8
Independence Day September 21
Immaculate Conception December 8
Republic Day December 13
Christmas Day December 25
 
 

Periods When Companies Usually Close

New Year holidays 3 days to a week closure around Christmas and New Year's eve
 

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Last Updates: October 2014