15% Flat Malta income tax option for high income foreign workers
Tax incentives for foreign executives earning over Euro 75K
Published on 07/04/2010
New tax rules provide that when income from qualifying contracts of employment is at least Euro 75K, the tax payer may opt to be taxed at a flat rate.of 15% Moreover, should income from a qualifying contract of employment exceed the sum of 5 million euro, no further tax will be charged on the excess.
Where income is paid by an employer (or a person related thereto) who has received a benefit under Malta’s business incentive laws, such income will not be eligible and will not be taken into consideration.
The new scheme is targeted at the following executive positions: Chief Executive Officer, Chief Risk Officer, Chief Financial Officer, Chief Operations Officer, Chief Technology Officer, Portfolio Manager, Chief Investment Officer, Senior Trader/Trader, Senior Analyst (including Structuring Professional), Actuarial Professional, Chief Underwriting Officer, Chief Insurance Technical Officer, Head of Marketing, Head of Investor Relations.
Moreover, as expected, the scheme contains a number of anti-abuse provisions which enable the authorities to see through artificial arrangements. This scheme is subject to several other restrictions and limitations. In particular, it is not available for (i) persons who are domiciled in Malta (the beneficiary will be typically resident in Malta but not domiciled therein); and (ii) any person who was employed for a period exceeding two years preceding the 1st January, 2011, under a contract of employment requiring the performance of his duties in Malta;
It is up to the MFSA to formally decide whether the activities of the particular applicant fall within the executive positions mentioned above. The applicant must therefore first submit an application on the appropriate form to this authority. Upon receiving the MFSA’s endorsement, eligible individuals will then be required to submit the prescribed form to the local tax authorities together with their tax return.
For further information regarding eligibility conditions/procedures contact: firstname.lastname@example.org
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