What is the Res, Non-Dom Status in Malta?
Malta offers a special taxation regime for individuals who are resident but not domiciled in the country, known as Res, Non-Dom. This regime can be beneficial for digital and content creators whose income arises outside Malta.
Under the Res, Non-Dom regime, individuals are not taxed on any foreign income or foreign gains. Only the portion of the remitted income to Malta is subject to income tax in Malta. Foreign capital gains are not taxed in Malta, even if remitted. This can result in significant tax savings for those who have income sources outside Malta.
Establishing Tax Residency in Malta
To qualify for the Res, Non-Dom regime, individuals need to establish their tax residency in Malta. There are two routes to establishing this:
- By spending 183+ days in Malta in a calendar year, or
- By expressing intention to reside in Malta ordinarily.
The prospective tax residents would need to follow the tax registration procedure and adhere to the annual tax reporting obligations in Malta. They may be subject to the minimum tax of €5,000 per year, depending on their circumstances and income level.
What are the Tax Rates for Res, Non-Dom Digital and Content Creators in Malta?
As a Res, Non-Dom, individuals will benefit from the following tax rates on their income:
- 0% on foreign capital gains, regardless of whether they are remitted to Malta or not
- 0% on foreign income, unremitted to Malta.
- 0-35% or 15% on foreign income remitted to Malta, subject to a minimum tax of €5,000 or €15,000 per year
- 0-35% on income and capital gains arising in Malta
Digital and content creators may also be eligible for double taxation relief, if they have paid tax on their foreign income in another country. Malta has an extensive network of double taxation treaties with over 70 countries, as well as unilateral relief provisions.
Malta is a great option for digital and content creators who want to enjoy a low-tax and high-quality lifestyle. By becoming a Res, Non-Dom, they can take advantage of the attractive taxation regime and the opportunities that Malta has to offer.
How can we help?
Moving to Malta may lead to a change of tax status from an individual who is not a tax resident – to a tax resident. A frequent misconception from prospective clients is that that holding a residency card presumes tax residency status in Malta and vice versa. Change of status will impact on how an individual is being taxed in Malta and what tax reporting obligations he has in this regard. While residency cards grant the right to live in a country, the tax residency status determines one’s tax liabilities.
These concepts are separate, and it’s instrumental to be aware of both before embarking on the journey of acquiring or terminating your residency.
Our Personal Tax Lawyers are able to assist with pre-immigration tax planning by advising on Malta basis of taxation applicable to non-resident and Malta tax residents; assist with foreign remittance planning by consulting on differences in tax treatment for various sources of income and means of their channeling. We are also able to provide guidance in relation to annual tax compliance obligations.
