Chetcuti Cauchi Advocates was chosen as the Malta Chapter Specialist for the International Comparative Legal Guides (ICGL)’s Private Client Review. This review covers common issues in private client laws and regulations – including pre-entry tax planning, connection factors, taxation issues on inward investment, succession planning, trusts and foundations, immigration issues and tax treaties in 29 jurisdictions.
Managing partner Dr Jean-Philippe Chetcuti, and partner Dr Priscilla Mifsud Parker at Chetcuti Cauchi have prepared Malta’s Chapter for this edition. The 28th Chapter of the 5th Edition of the Private Wealth & Private Client Law review deals with Maltese legislation with regards to the private client.
In this review, all the issues which directly impact the Private Client are meticulously explored in order to see the Maltese legislative order in their regards.
The chapter, which can be accessed from here, contains eleven sections dealing with Private Client Law:
- Pre-entry Tax Planning
Subjects discussed include pre-entry estate and gift taxes (which are not applicable in Malta) and pre-entry income and capital gains tax planning.
- Connection Factors
Unlike nationality, domicile or habitual residence is relevant to determine if a person is liable to taxation in Malta. Moreover, another important connecting factor is the source of income, as all income which arises in Malta is taxable in Malta, irrespective of whether the recipient is a resident or is domiciled in Malta.
- General Taxation Regime
This section gives an excellent overview of the taxation regime in Malta which is often seen as one of Malta’s an attractive factor. Non-domiciled persons who establish their residence in Malta will be liable to remittance basis of taxation, meaning they will be liable to tax on income and taxable capital gains arising in Malta and foreign source income which is received in Malta. The section also goes into supplementary direct and indirect taxes, as well as anti-avoidance taxation provisions and general anti-avoidance or anti-abuse rules to counteract tax advantages.
- Taxation Issues on Inward Investment
This section explores the tax liabilities which arise on the acquisition, holding or disposal of, or receipt of income from investment, taxes on the importation of assets (including excise taxes) and any particular tax issues with regards to the purchase of residential properties.
- Taxation of Corporate Vehicles
This section deals with tax vis-a-vis corporations, dealing with the requisites for a corporation to be taxable, the main tax liabilities payable by a corporation which is subject to tax and how branches of foreign corporations are taxed in Malta.
- Tax Treaties
Malta has entered into approximately 70 double taxation agreements which continue to encourage the growth of trade between two countries. Moreover, Malta’s treaties generally follow the OECD model.
Focusing on Chapter 16 of the Maltese Civil Code which is the main legislation on succession and Article 682 which is the only conflict of law rule within the Maltese Civil Code dealing with wills made outside of Malta which have effect in Malta, this section also goes into depth on rules on the essential validity of wills, as well as rules which apply to real estate held in Malta or elsewhere. Our Private clients Practice at Chetcuti Cauchi includes a number of lawyers who deal with succession law.
This section goes into detail about the taxation of trusts and foundations and how succession affects them.
- Matrimonial issues
The subject of matrimony has seen a number of changes, especially in the past 5 years with the introduction of civil partnerships in 2014 and divorce in 2011. Thus, this sub heading goes into detail about those changes and their respective legislation, matrimonial property regimes as well as pre or post marital agreements contracts. With regards to divorce, the sub-heading also explores the main principles which apply in Malta in relation to financial provisions on divorce.
Apart from outlining who may enter the country, the subheading also summarises the framework for the Malta Citizenship by Investment Programme, which is granted to investors seeking to obtain a European passport within one year. The Malta Citizenship by Investment Programme is the only EU-approved economic passport programme. It also highlights a number of other programmes, including the Malta Ordinary Residence Scheme, Malta Golden Visa Programme (Malta Residency & Visa programme), the Residence Programme Rules (previously Malta High Net Worth Residence Scheme –European Nationals) and the Malta Global Residence Programme ( previously Malta High Net Worth Residence Scheme –Non- European Nationals). Our Private Client Practice at Chetcuti is particularly specialised in this area, being one of the oldest firms in Malta specialising in Immigration law.
- Reporting Requirements/Privacy
This sub-heading deals with the automatic exchange of information agreements which Malta has entered into with other countries.
