MALTA: DOUBLE TAX TREATIES

Malta Double Tax Treaties

The table below shows the countries which have double-tax treaties with Malta.

A treaty with Barbados was signed in December 2001. In September, 2004, Malta signed a DTAA with Iceland.

In May, 2005, Malta and San Marino held discussions on the terms of a DTAA. In the same month, Maltese officials conceded that they faced a difficult task in trying to persuade US officials of the merits of a Double Taxation Avoidance Agreement, after what was termed a successful visit to the US. Malta is the only member of the European Union not to have a DTAA with the United States.

In March, 2006, Maltese Foreign Minister Michael Frendo and H.E. Dr. Mohammed Khirbash, Minister of State for Finance and Industry of United Arab Emirates signed an Agreement for the Avoidance of Double Taxation.

The signing ceremony took place at the Ministry of Finance and Industry in Abu Dhabi after bilateral talks between Minister Michael Frendo and Minister Khirbash.

“We are very happy to sign this Avoidance of Double Taxation Agreement with the Emirates” commented Minister Frendo after the signing ceremony, “because this strengthens the framework for increased trade, investment and business opportunities between the two countries.”

In the same month, an Agreement for the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income was signed between the Republic of Singapore and Malta.

Mr Raymond Lim, Second Minister for Foreign Affairs and Finance, signed on behalf of Singapore and Dr Michael Frendo, Foreign Minister of Malta, signed on behalf of Malta at a ceremony in Singapore.

The Agreement aims to alleviate the burden of double taxation which arises when the resident of a contracting state derives income from the other contracting state. It also makes clear the taxing rights between Singapore and Malta on all forms of income from cross-border economic activities between the two contracting states. There are also provisions for reduction or exemption of tax on certain types of income.

The Agreement facilitates the cross-flow of trade, investment, financial activities and technical know-how between Singapore and Malta.

The Agreement will enter into force after its ratification by both countries. The provisions of the Agreement will apply to income arising in the year after its entry into force.

Albania Australia Austria Barbados Belgium Bulgaria Canada China Croatia Czech Republic Cyprus Egypt Federal Rep. of Germany Finland France Hungary Iceland India Italy Korea Kuwait

Lebanon Libya Lithuania Luxembourg Malaysia Netherlands Norway Pakistan Poland Portugal Romania Singapore Slovakia South Africa Sweden Switzerland Thailand Tunisia Turkey United Arab Emirates United Kingdom USA (suspended)

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Malta Table of Treaty Rates

This table lists the percentage rates of withholding tax on payments made from Treaty countries to Malta.

Country	Dividends		% share to qualify	Interest	Royalties
	Minor Share-holding	Major Share-holding
Australia	15	15		15	10
Austria	15	15		5	10
Belgium	15	15		10	10
Bulgaria	nil	nil		15	10
Canada	15	15		15	10
China	10	10		10	10
Cyprus	15	15		10	10
Czech Rep.	5	5		nil	5
Denmark	15	0	25	nil	nil
Finland	15	5	25	10	10
France	15	5	10	10	10
Germany	15	5	25	10	10
Hungary	15	5	25	10	10
India	15	10	25	10	15
Italy	15	15		10	10
Korea	15	5	25	10	nil
Libya	15	15		15	15
Luxembourg	15	5	25	nil	10
Malaysia				15	15
Netherlands	15	5	25	10	10
Norway	15	15		10	10
Pakistan	15	15	20	10	10
Poland	15	5	20	10	10
Romania	5	5		5	5
South Africa	15	5		10	10
Sweden	15	nil	10	nil	nil
UK	nil	nil		10	10

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Malta Other International Agreements

In January, 2004, the Guernsey Financial Services Commission and the Malta Financial Services Authority signed a Memorandum of Understanding which provides a framework for closer cooperation between the two regulatory bodies. The Memorandum provides a formal basis for cooperation, including the exchange of information and investigative assistance.

Peter Neville, Director General of the Commission, commented: “I am very pleased to have taken this step. I advised Malta on the setting up of its investment service regulation, and I have known the Maltese regulators for many years.”

He added: “This Memorandum of Understanding between the Commission and the Malta Financial Services Authority is another step towards strengthening our relationship, providing a formal basis by which we can cooperate and exchange vital information."

In May, 2004, the respective chairmen of the Maltese and United Kingdom financial regulators signed a memorandum of understanding, facilitating the exchange of information and investigative assistance.

The agreement was signed by Professor Joe Bannister, head of the Malta Financial Services Authority and Callum McCarthy, the UK’s Financial Services Authority chief in London, and lays down a “formal basis for cooperation” between the two bodies.

“The MFSA and the FSA believe such co-operation will enable them to more effectively perform their functions," stated the text of the MOU.

Noting that the authorities of Malta and the UK have long cooperated on an informal basis, Professor Bannister explained that the growing complexity of the global financial system necessitated the inking of a formal agreement to combat the threat of financial crime.

In July, 2004, the Malta Financial Services Authority (MFSA) and the Gibraltar Financial Services Commission entered into a Memorandum of Understanding on exchange of information. The Memorandum was signed in Malta by MFSA Chairman Prof. J.V. Banister and Mr. Marcus Killick, Chairman and Commissioner of Gibraltar’s Financial Services Commission.

The MOU sets out to establish “a formal basis for co-operation, including the exchange of information and investigative assistance in the fields of banking, insurance, investment services and the provision of professional trusteeship and company management services, and the exchange of information on supervisory practices and techniques.”

During Mr. Killick’s visit, bilateral talks were held on how regulatory and supervisory collaboration between the two organizations may be further enhanced, including proposals for reciprocal visits by staff and other means of improving mutual understanding of the operations and supervisory techniques of the organizations.

In November, 2005, the Jersey Financial Services Commission and the Malta Financial Services Authority signed a Memorandum of Understanding, which provides specifically for the exchange of information between the two financial services regulators.

The Memorandum of Understanding constitutes a statement of intent by the regulators to create a formal framework for regulatory collaboration, investigative assistance and co-operation. Such collaboration should help to protect investors and depositors and to promote the integrity of financial services markets in the two jurisdictions.

The Memorandum of Understanding commits both regulators to providing help within the limits of each jurisdictions’ laws, and setting up procedures and liaison points so that requests for information needed for tackling financial regulatory offences can be handled rapidly and efficiently. The agreement also provides an environment for the development of additional business between the two jurisdictions.

Commenting on the MoU, David Carse, Director General of the Jersey FSC noted that: “I am delighted to sign this Memorandum of Understanding with the MFSA. It is the latest in a number established between the Commission and regulators in the European Union.”

Meanwhile, Mr Carse's counterpart at the MFSA, Joe Bannister, observed that: “This is part of our process to increase collaboration with recognised finance centres. There is extensive collaboration between practitioners in Malta and Jersey, and this Memorandum of Understanding will further enhance business between the two finance centres.”

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