Malta Non-Domiciled Tax Regime: A Guide for Global Investors

Under Malta’s Non-Domiciled tax regime, foreign income and capital gains are not subject to Maltese income tax. Only income or gains earned in Malta and the percentage of foreign income sent to Malta are subject to taxation for residents who are not domiciled in Malta.

Many who benefit from this regime also explore additional opportunities, such as securing residency through the Malta Residency by Investment program or obtaining full EU citizenship via Malta Citizenship by Investment.

In this guide, we’ll explore:

How the Malta non-dom tax regime works
Who qualifies
How to maximize its benefits.

What is the Malta Non-Domiciled tax regime?

The Malta Non-Domiciled tax regime is a preferential system for those who become tax residents in Malta but are not domiciled there. Under this regime, you are taxed only on:

Income generated within Malta.
Foreign-source income remitted to Malta.

Foreign income kept outside Malta is exempt from Maltese income tax, and foreign-source capital gains are entirely tax-free, even if brought into Malta.

Only income originating in Malta is subject to taxation for non-resident individuals. Income earned in a calendar year (also known as the basis year) and assessed for tax in the year after the year of occurrence (also known as the year of assessment) is liable to individual taxation.

Those with foreign incomes under €35,000 are exempt from the minimum tax obligation for non-domiciled individuals.

The €35,000 barrier for married couples is determined by taking into account their combined income, and they are subject to a minimum tax of €5,000.

This system is particularly attractive to non-domiciled residents, such as entrepreneurs, expatriates, and investors.

How does the Malta Non-Dom Tax system work?

The remittance basis of taxation of the Malta Non-Dom regime means the following.

Taxable Income:

Income generated within Malta is fully taxable.
Foreign income remitted to Malta is subject to Maltese tax laws.
Employment income from work performed in Malta is taxable.

Exempt from Taxation:

Foreign source income that remains outside Malta is not subject to tax.
Foreign source capital gains are exempt, even if remitted to Malta.

Malta Non-Dom Tax Regime Eligibility Criteria

Eligibility Criteria for Tax Residency in Malta

Individuals who do not have a domicile in Malta but establish tax residency by:
- Spending 183 days or more in Malta during the tax year, or
- Demonstrating a clear intention to reside in Malta.
Possessing a Maltese residency card alone does not automatically grant Non-Dom (Non-Domiciled) status, although it is generally considered a requirement.

Taxation Rules for Non-Domiciled Residents in Malta

Non-Dom individuals in Malta are taxed on:
- Foreign-source income only if it is remitted (transferred) to Malta.
- Local-source income and chargeable capital gains.
- Overseas capital gains remain tax-free in Malta, even if transferred.
Individuals who are neither tax residents nor domiciled in Malta are only taxed on:
- Income originating within Malta.
- Capital gains generated within Malta.

Benefits of the Malta Non-Dom Regime

Low or zero tax on foreign income

Foreign source income is only subject to tax if it is remitted to Malta.
Any foreign income kept outside Malta remains entirely tax-free.
Foreign investment income, such as dividends, interest, and rental income, is only taxable if transferred to Malta.
Employment income derived from work performed outside Malta is not taxed locally unless remitted.

Exemption on capital gains outside Malta

Malta tax haven system allows full exemption on foreign-sourced capital gains, even if those gains are remitted to Malta. This means that:

Capital gains arising from investments, stocks, or real estate sales outside Malta are not subject to tax.
High-net-worth individuals and entrepreneurs can structure their wealth through foreign investments without triggering Maltese tax liabilities.
This exemption applies to all resident non-dom individuals, making Malta a tax-friendly jurisdiction for wealth accumulation.

Access to Malta’s Double Tax Treaties

Malta has an extensive network of double taxation treaties with over 70 countries, ensuring that individuals do not pay tax on the same income in multiple jurisdictions.

Key Benefits of Malta’s Double Tax Agreements:

Reduced tax rates on foreign dividends, royalties, and interest payments.
Protection from double taxation, allowing individuals to claim tax credits for taxes paid abroad.
Enhanced tax efficiency for individuals and businesses with foreign-source income, enabling strategic financial planning.

Notable Countries with Double Tax Agreements with Malta:

United States
Canada
United Kingdom
Australia
New Zealand
Most EU countries, including Germany, France, Italy, and Spain

Requirements to Maintain the Malta Non-Dom Status

Individuals must fulfill certain tax residency requirements and properly manage their foreign income to continue benefiting from Malta’s Non-Dom taxation.

Meeting residency obligations

Individuals must be residents of Malta, meaning they spend at least 183 days in the country each year.
Proof of residency status (evidencing res) may be required, including rental agreements, utility bills, or economic ties to Malta.
Long-term resident non-dom individuals must ensure they do not trigger deemed domicile rules, which could result in taxation on their worldwide income.
Failing to meet tax residence requirements may lead to the loss of non-dom status and exposure to Maltese income tax on global earnings.

Proper management of foreign income and remittances

Foreign source income that remains outside Malta is not subject to tax, but once remitted to Malta, it becomes taxable income.
Income generated outside Malta should be structured carefully to avoid unnecessary taxation.
Foreign source capital gains remain exempt from tax, even if remitted, providing a significant tax advantage.
Proper tax reporting is necessary to ensure compliance with Maltese tax authorities and avoid penalties.

Exclusions for Maltese domiciled individuals

Individuals domiciled in Malta do not qualify for non-dom status and are subject to income tax in Malta on their worldwide income.
Those who establish deemed domicile rules by residing in Malta for an extended period may lose eligibility for non-dom taxation benefits.

How to Apply for Malta Non-Dom Status

Here are the steps to become a Malta Non-Domiciled resident:

Establish tax residency status in Malta.
Provide proof of economic ties to Malta, such as renting property or opening a bank account.
Submit an application to the Maltese tax authorities confirming residency status.
Ensure compliance with the remittance basis of taxation to maintain tax advantages.

Comparing the Malta Non-Dom Tax to Other Non-Dom Regimes

Malta’s Non-Dom taxation system is one of the most competitive in Europe.

Malta vs. UK Non-Dom Regime: Which is more tax-friendly?

Both Malta and the UK offer a non-dom tax system, which closes in April 2025, based on the remittance basis of taxation, but Malta provides several advantages:

Tax rates: The UK imposes a high flat rate annual charge (£30,000–£60,000) after a certain period, whereas Malta does not have such fees for non-domiciled residents.
Capital gains: Unlike the UK, Malta does not tax foreign-source capital gains, even if they are remitted to Malta.
Tax residency: UK Non-Dom status is time-limited due to deemed domicile rules, while Malta offers long-term resident non-dom status with fewer restrictions.
Wealth tax: The UK imposes an inheritance tax on worldwide income for long-term resident non-dom individuals, while Malta does not impose a gift tax, wealth tax, or inheritance tax.

How Malta Non-Dom Regime outperforms Cyprus and Ireland

Compared to Cyprus and Ireland, Malta’s Non-Dom tax structure provides better tax efficiency:

Malta Non-Dom Regime: No tax on foreign investment income unless remitted (15% flat rate under Resident Non-Dom (RND), min €5k tax; 15% under GRP for non-EU nationals, no stay requirement). No Capital Gains Tax, wealth, or inheritance taxes on foreign assets. Unified Grant (UG) available for high-net-worth individuals.
Cyprus Non-Dom: 17% flat tax on dividends (vs. Malta’s 0% if unremitted).
Ireland Non-Dom: 40% progressive tax on remitted income, 33% Capital Gains Tax on worldwide gains.

How Can Global Citizen Solutions Help You?

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Frequently Asked Questions About the Malta Non-Dom Regime

How to become a tax resident in Malta?

Tax residency in Malta is primarily determined by spending 183+ days per year in the country. However, the rules are flexible—individuals who establish “habitual residence” may qualify even with fewer days. Proof such as a rental agreement, property ownership, or employment in Malta supports residency claims.

Do I need to file a tax return as a Malta tax resident non-domiciled?

Yes, you must file a tax return if you earn income in Malta or remit foreign income to Malta. However, foreign income is kept abroad, and foreign capital gains are exempt from taxation.

How can I ensure compliance with the Malta tax system?

To stay compliant, report all taxable income accurately and understand the remittance basis. Seeking advice from a Maltese tax expert can help avoid mistakes and optimize your tax position.

How does Malta tax residence differ from domicile?

Tax residence is based on the number of days spent in Malta, while domicile refers to an individual’s permanent home and long-term intentions. Non-domiciled residents in Malta are not taxed on foreign income unless remitted to the country.