In Malta, tax rates are low compared to other countries in the world. Income tax rates range from 15%-35% (depending on income).
If you are planning to live and work in Malta, check your tax and social security position to ensure you are not paying too much or not receiving entitled benefits.
In Malta, both employers and employees contribute 10% of their gross salary to the social security system. Self employed citizens also make contributions. The system receives additional funding from government subsidies (about 50% of total funds). The social security system covers residents aged 18 or more, employees and employers in Malta, and students in certain work-study programs. For more information, go to the Maltese Inland Revenue website .
Sick Leave: Sick leave benefits are paid to employees and those who are self-employed after three days of leave. During the first three days, employees are paid their full wage. The self-employed have to cover the first three days of sick leave themselves.
Maternity Leave: Thirteen weeks of fully paid maternity leave are granted by employers to their employees. However self-employed women are not entitled to this. Instead, they receive thirteen weeks of half the minimum wage by the social security.
Old-age benefit: In some cases, the social security system pays a minimum of old-age benefits. However, these are only for those who do not receive regular pensions from earning-related pension contributions.
In Malta, contributions to the public pension system are mandatory and are based on earnings. The pension scheme provides for old age pensions, survivors' benefits and invalidity pensions through a means-tested welfare programme. The minimum pension guarantee is approximately 50% of the average wage. Private pension schemes are not running in Malta at the moment of writing. Legislation is being implemented for the introduction of private pensions based on occupation and personal savings.
Malta has Double Taxation treaties with 34 other countries. People from these countries who retire in Malta can have their pensions sent to them free of tax, and they will only pay 15% tax on their pensions in Malta. This is if they have permanent residence status.