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In Malta there are no land taxes, no municipal taxes and no council taxes – The following are the only property taxes that exist.

Stamp Duty - 5 % of purchase price of a property

Capital Gains:

In Malta, Capital Gains Tax is actually a transaction cost and not a tax on capital gains.
Capital gains earned when a property is held for less than seven years can be taxed in one of two ways. It can be taxed at a flat rate of 12% on the selling price or at progressive rate under the old system. – 35% on profit (after expenses)

Capital Gains Tax is generally levied at a flat rate of 12% on the transfer value or the selling price. Only brokerage fees can be deducted from the selling price. During the sale, a provisional tax equal to 12% of the selling price must be paid to the notary public who will then pass it on to the Inland Revenue as payment of the tax liability.
Under the old system, a provisional tax levied at 7% of the deed must be initially paid through the notary public, who will then pass this on to the Inland Revenue as initial payment. This amount is credited to the total tax payable.

The capital gains realised from the sale of the property must be declared on the income tax return and will then be taxed at progressive income tax rates. To calculate the capital gain under the old system, the following can be deducted:

• the price at which the property was acquired
• the inflation element
• any ground-rent paid on the property and for which a deduction has not been already claimed in any other way
• a maintenance allowance at the rate of 0.4% for every year that the owner held the property
• improvements carried out
• any duty paid on acquisition
• notary's fees
• brokerage fees
• other expenses directly related to the transfer but not exceeding 5% of the selling price

If the property is held for less than seven years, Capital Gains Tax is generally levied at a flat rate of 12% on the transfer value or the selling price. Only brokerage fees can be deducted from the selling price. During the sale, a provisional tax equal to 12% of the selling price must be paid to the Notary Public who will then pass it on to the Inland Revenue as payment of the tax liability.

In heritance Tax

There are no inheritance, gift, or wealth taxes in Malta. However, a transfer duty is payable by the heir at 5% of the declared property value.
If the property is jointly owned by spouses, and one of the spouses has died, 5% is levied on only half the value of the property. Note that under Maltese law, the spouse is not entitled to any inheritance. The whole estate is divided between the children or next of kin. To avoid such complications, make sure that a will is written and registered.

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