Malta

Are foreign capital gains taxed in Malta?

No, and this is the most notable feature of the regime. Foreign-source capital gains realised by a non-domiciled resident are outside the scope of Maltese tax, including where the corresponding proceeds are remitted to Malta. The treatment therefore differs from that applicable to income, which becomes taxable as soon as it is remitted. For an investor whose performance is derived primarily from disposals of securities rather than dividends or interest, this distinction can completely change the economics of the structure. It does, however, require careful qualification: the boundary between a capital gain and income is not always straightforward depending on the instruments held, and a reclassification could undermine the treatment. This analysis should be carried out in advance, on an instrument-by-instrument basis, with a Maltese adviser.

What is the Global Residence Programme?

It is the programme most commonly used by nationals of third countries wishing to establish residence in Malta. It applies a flat rate of 15% to foreign-source income remitted to Malta, subject to a minimum annual tax liability of €15,000 regardless of the amount actually remitted. Maltese-source income remains subject to the ordinary progressive rates, with the top rate reaching 35% (Commissioner for Tax and Customs). Eligibility requires the applicant to own or rent qualifying immovable property meeting specified value thresholds, which vary depending on whether the property is located on the main island or in Gozo, as well as to have health insurance and stable financial resources. The status is maintained by continuing to satisfy these conditions. For an EU national, relocation does not require this programme, as freedom of movement is sufficient to establish residence.

How does the taxation of Maltese companies work?

The headline corporate income tax rate is 35% (Commissioner for Tax and Customs), one of the highest in Europe, which often comes as a surprise at first glance. Malta nevertheless operates a full-imputation system combined with a refund mechanism available to shareholders upon the distribution of profits, which substantially reduces the effective tax burden borne at group level. This mechanism is longstanding, regulated and widely used, but it calls for three precautions. Its benefits depend on correct structuring and compliance with specific conditions. It is subject to close attention from European institutions and OECD work, meaning that developments need to be monitored rather than the regime being taken for granted over a ten-year period. And it in no way removes the need for genuine substance in Malta.

What are the practical constraints of the remittance basis?

They are operational before they are legal, and this is where structures can deteriorate. The principle requires a continuous distinction between funds constituting income for the year, which are taxable when remitted, and funds constituting capital or capital gains, which are not. This requires a banking architecture designed in advance: separate accounts abroad, a Maltese account funded solely with flows intended to be taxed, and documentation making it possible to trace the origin of each transfer. Mixing different sources of funds in the same account creates an adverse presumption and may result in the loss of the benefit of the treatment. This organisation should be put in place before relocation. Reconstructing it afterwards is difficult and, in some cases, impossible.

Is Malta suitable for a family relocation?

The country has genuine advantages: membership of the European Union and the Schengen Area, English as an official and teaching language, good-quality international schools, a Mediterranean climate, satisfactory levels of safety and convenient air connections with France. The reservations relate primarily to geography. The archipelago is small and one of the most densely populated areas in Europe; traffic can be difficult during peak hours, the supply of high-quality family accommodation remains limited, and summer tourist pressure is significant. Access to specialised medical services may also require travel to Italy in certain circumstances. These factors do not rule out the destination, but they explain why families often remain there for shorter periods than individual profiles. We address these considerations before the project is undertaken.

Is there a minimum tax for non-domiciled residents in Malta?

Yes, since 2025, and many descriptions of the regime still overlook this point. An ordinary non-domiciled resident who does not fall under any special programme is subject to a minimum annual tax of €5,000 once their worldwide foreign-source income exceeds €35,000, regardless of whether that income is remitted to Malta (Malta Tax and Customs Administration). For a couple, the €35,000 threshold is assessed by reference to household income and the minimum tax applies once. This rule changes the equation for smaller estates: below a certain level of income, taxation on the remittance basis loses some of its appeal.

How does the Maltese shareholder tax refund work?

Through a full-imputation system that is unique in Europe. The company pays tax on its profits at the nominal rate of 35%, after which the shareholder may claim, upon distribution, a refund of part of the tax paid—six-sevenths in the case of trading income—which brings the effective tax burden down to approximately 5% (Malta Tax and Customs Administration). This mechanism is entirely lawful and recognised, but it requires sufficient liquidity to fund the tax before the refund is received, as well as an appropriate shareholder structure. It also attracts the attention of foreign tax authorities, making Maltese substance essential rather than merely ancillary.

Does the France–Malta tax treaty provide sufficient security for a relocation?

It provides the framework. France and Malta are bound by a double tax treaty containing hierarchical tie-breaker criteria in cases of dual residence and establishing mechanisms for the elimination of double taxation (list of tax treaties concluded by France). Malta is also a member of the European Union, meaning that EU directives apply and eliminate withholding taxes in a number of intra-group situations. This combination of treaty protection and the European framework provides a degree of legal certainty that neither the Bahamas nor Paraguay offers. It does not, of course, remove the need to genuinely relocate one's residence, as the treaty applies only to an actual tax resident.

How are Maltese-source income streams taxed?

Under the ordinary progressive rates, with the top rate reaching 35% (Malta Tax and Customs Administration, tax rates). This is the point that the remittance regime does not cover: only foreign-source income benefits from taxation on the remittance basis, whereas income generated in Malta is taxed in full, whether or not it is remitted. An entrepreneur carrying on their business from Malta for the benefit of Maltese clients would therefore be taxed under the local progressive rates, without any specific advantage. The structuring exercise consists precisely in distinguishing what constitutes Maltese-source income from what does not, and that distinction must be properly documented.

How is an estate administered for a Maltese resident?

Malta does not levy inheritance tax as such, but it applies duty on documents upon the transfer of certain assets, notably Maltese immovable property and shares in property-holding companies, at the rate prescribed under local legislation. From the French perspective, Article 750 ter of the French General Tax Code remains applicable: assets located in France remain taxable, while worldwide assets may be taxable where the heir has been resident in France for six of the preceding ten years (BOFiP, territorial scope of inheritance and gift taxes). The absence of a specific inheritance tax treaty between the two countries makes this interaction particularly sensitive for a family whose children have remained in France.

What social security contributions apply in Malta?

A mandatory contributory system applies to both employees and self-employed individuals, with rates based on income and weekly ceilings revised annually. As Malta is a member of the European Union, the EU coordination regulations apply, allowing insurance periods to be aggregated with France for pension purposes and providing access to healthcare in both countries, depending on the circumstances. This is a practical advantage compared with non-EU destinations, where healthcare and social protection generally have to be rebuilt through costly private insurance. For a family, this factor can carry more weight than anticipated when comparing Malta with Dubai or Mauritius.

Is it difficult to open a bank account in Malta?

This is the main operational friction point in a Maltese relocation, and it has become more pronounced. Local institutions apply extensive verification procedures, require detailed evidence of the source of funds and regularly refuse applications where there is no genuine economic connection with the island. Processing times are measured in weeks and sometimes months. This strictness reflects Malta's efforts to move away from international monitoring lists. It has a positive effect, but it means the project needs to be sequenced properly: the banking relationship should be secured before entering into a lease, purchasing property or incorporating a company.

Does the remittance basis require particular discipline?

Yes, and this is its real constraint. Taxation on the remittance basis requires a strict distinction between foreign income remitted to Malta and foreign income that is not remitted, which in turn requires strict segregation of accounts, traceability of funds and documentation supporting transfers (Malta Tax and Customs Administration). Mixing pre-existing capital and current income in the same account makes it impossible to demonstrate the distinction and exposes the taxpayer to taxation on the entire amount. This documentary requirement is the real cost of the regime: it requires ongoing accounting and financial monitoring, which we organise from the outset of the relocation rather than waiting until the first tax audit.

How does Coreway Consulting support a relocation to Malta?

We begin by mapping your income streams, separating amounts that constitute income taxable upon remittance from those that constitute capital and capital gains. This is the analysis that determines the regime's actual relevance to your situation, well before selecting a programme. We then build the corresponding banking architecture in advance of the relocation, since it is fundamental to the application of the regime. We manage the application for the appropriate status based on your nationality and profile with our Maltese correspondents, as well as the corporate structuring where appropriate. Finally, we coordinate the termination of French tax residence with the relevant advisers.