Taxation

Other Taxation

Trusts

The taxable income of a trust is generally taxed at a flat rate of 35% on the taxable income. Settlement of property to the trustee is subject to tax in the hands of the settlor. Certain settlements of property whose beneficiaries are incapacitated or disabled persons are exempt of tax.

Shipping

Ships and yachts registered in Malta by non-resident owners and charterers qualify for various fiscal and other benefits, including income tax exemptions on profits generated from the ownership and operation of a ship. There is no stamp duty on the transfer of shares in shipping companies.

Gaming Activities

Companies registered in Malta engaged in overseas gaming activities, including e-gaming, require a licence from the Gaming Authority. A gaming tax of 0.5% is levied on the aggregate of stakes placed, but there is capping on the amount payable per annum. The mechanics of an International Trading Company can be used for companies carrying out such operations, whereby the distributable profits are available to the non-resident shareholder at a net income tax rate of 4.17%.

Filming

The Malta Government is currently contemplating a set of fiscal and non- fiscal incentives for local and foreign companies engaged in the filming industry.

Collective Investment Schemes

Licensed collective investment schemes are taxed at 10% or 15% depending on the category of income.

Tax Planning

Non-resident individuals or non-resident companies holding shares in Maltese registered International Trading Companies are subject to a net tax charge of 4.17% on dividends emanating from profits of such companies. In the case of shareholdings in International Holding Companies, the relevant net tax charge is of between 0% to 6.25% on dividends receivable from such shareholding.

Maltese companies with foreign income that was subject to a nil overseas tax rate are granted a deemed foreign tax credit of 25% in computing their Maltese tax liability.