Tax in Malta
The Maltese tax regime remains an important pediment on which Malta has registered steady and significant economic growth. However, the complexity of direct taxes and indirect taxes has required a proficient understanding of the enactments and the landmark court judgements both at a domestic and European level.
In recent years, this body of law has sought to balance fiscal sovereignty of Malta with the need to eliminate distortions of competitions within the European single market. It has also brought with it more obligations pertaining to tax transparency requiring more synergies and compliance work.
GVZH applies its specialised knowledge of (inter)national and EU tax law to clarify and solve any complicated tax questions in an efficient and decisive manner. These services which are intended to deliver tax certainty to our clients include tax dispute resolution, advisory and consultancy support. We also provide support to other tax professionals requiring collegial consultation in complex cases or those cases which involve a large financial interest. Our specialised knowledge and proficiency in procedural law allows us to represent clients successfully through the whole process both through experienced negotiations with the Office of the Commissioner for Revenue and through litigation.
It is well-known that the Maltese tax offering brings important benefits including a wide double tax treaty network and the lack of withholding taxes on dividends, interest, and royalties. Furthermore, Malta generally applies a traditional full imputation system and a tax credit refund system which has proved to be an attractive solution to many international businesses. From an individual taxation perspective, the Maltese system incorporates special schemes which significantly lower tax rates incentivising comprehensive relocations (e.g. Global Residence Programme / Highly Qualified Persons Schemes).
Malta is expected to legislate provision for transfer pricing generally in terms of article 51A of the Income Tax Act. In addition, commercial arrangements would have to be counterbalanced against the obligations emanating from the EU Anti-Tax Avoidance Directives. In this regard, our practice works to structure commercial arrangements in a manner which reflect the economic reality. We focus our attention on ensuring substance is maintained in Malta whilst taking into stock applicable governmental incentives through the leveraging of strong Notional Interest Deduction Rules to address debt bias; a patent box regime to drive innovation and other similar instruments which are tailor made for the trading activity being led.
Our support extends to indirect taxes such as VAT to ensure that commercial arrangements are as much as possible VAT neutral. Our contention is that tax planning without a combined good understanding of the implications of other Indirect Taxes is equivalent to missing the wood for the trees. Therefore, our technical expertise aims to provide high quality content which keenly underlines the whole picture. Thus, our service line will equivalently provide holistic support on Eco-Contributions, Stamp Duty, Excise Duties, and Import Duties.
Last but not least our tax team also retains a select portfolio of private clients for the provision of routine tax compliance services both for both direct and indirect tax purposes. These tax services which are led by our tax accountants form an integral part of our accounting services. These tax services include the filing of routine tax returns and other relevant documentation.