Tax rate for qualifying expatriates in
the digital gaming industry
INTRODUCTION
In 2012, through the digital gaming strategy report, a number of key steps were identified as being
required by Malta to develop a strong gaming industry.
With this aim in sight, and through Legal Notice 106 of 2013, another incentive was introduced aiming at
‘rewarding’ expatriates working in the development of innovative and creative digital products.
Whereby, such individuals benefit from a special tax rate of 15% provided that certain conditions are
met.
QUALIFYING CONDITIONS
In order to benefit from this advantageous tax rate, the following conditions have to be fulfilled:
1. income must be derived from a qualifying contract of employment (the individual occupies a role
directly related to the development of innovative and creative digital products);
2. income has to be received by a beneficiary;
3. income must not be less than forty-five thousand euro (€ 45,000) per annum (exclusive of any fringe
benefits) and must consist of emoluments from an eligible office; and
4. application must be sent to the Malta Enterprise Corporation, which must satisfy that the individual
holds a qualifying contract of employment in an eligible office, that the employer has not benefitted
from any business incentive laws and that the remuneration is not paid by a person who is related to
the employer and who has received a benefit under business incentive laws.
These conditions have to be read in conjunction with the definitions of the terms Eligible Office and
Beneficiary.
© 2015 Nexia International Limited. All rights reserved.
Nexia International is a leading worldwide network of independent accounting and consulting firms, providing a comprehensive portfolio of audit, accountancy, tax and advisory services. Nexia International is the trading name of Nexia International Limited, a company registered in the Isle of Man. Company registration number: 53513C. Registered office: 1st floor, Sixty Circular Road, Douglas,
Isle of Man, IM1 1SA. The trademarks NEXIA INTERNATIONAL, NEXIA and the NEXIA logo are owned by Nexia International Limited. Nexia International and its member firms are not part of a worldwide partnership. Member firms of Nexia International are independently owned and operated. Nexia International does not accept any responsibility for the commission of any act, or omission to act
by, or the liabilities of, any of its members.
Closer to you
BENEFICIARY
Lead In-World Writer, Lead Game Programmer, Software Engineering Director, Game Developer,
In terms of the incentive, a beneficiary is an individual who:
Commercial Director (Digital Licensing), Head of Game Design, Game Director, Audio Director, Game
• is protected as an employee under the Maltese law, is paid and has the required adequate and
Designer, Video Director, Producer and Head of Marketing.
specific competence, as proven to the satisfaction of Malta Enterprise corporation;
• proves to the satisfaction of the Corporation that s/he performs a function which is directly related
to the development of innovative and creative digital products and that s/he is in possession of the
requisite qualifications and experience to carry out that function;
• declares for income tax purposes in Malta any emoluments received from the qualifying contract of
employment and all income received from a person related to his/her employer;
• receives emoluments payable under a qualifying contract of employment and in respect of work or
duties carried out in Malta, or in respect of any period spent outside Malta, in connection with such
work or duties, or on leave during the carrying out of such work or duties;
• satisfies Malta Enterprise corporation that s/he does not need to recur to the social assistance
Director of Online Community, Head of Art Design and Visualisation, Art Director, Digital Artist,
MALTA TAX TREATMENT
Income derived from a qualifying contract will be deemed to constitute the first part of the individual’s
total income and subject to tax at a flat rate of 15%. This rate shall apply without the possibility to claim
any relief, deduction, reduction, credit or set-off of any kind. Additionally, no further tax would be
charged on income from a qualifying contract of employment in excess of five million euro (€ 5,000,000).
DURATION OF THE SCHEME
system in Malta and hence that s/he receives regular resources which are sufficient to maintain him/
The flat rate of 15% with respect to EEA, Swiss nationals and third country nationals applies for a
herself and his/her family;
consecutive period of not more than 3 years. This period commences from the year preceding the first
• proves to the satisfaction of Malta Enterprise corporation that s/he is in possession of a sickness
year of assessment in which the person is first liable to tax in Malta. As soon as the three-year period
insurance, a valid travel document, and that s/he resides in an accommodation which meets the
expires, the income derived from employment would then be chargeable to tax at normal rates of tax
general safety standards in force in Malta; and
applicable to individuals.
• is not domiciled in Malta.
ELIGIBLE OFFICE
WITHDRAWAL OF RIGHTS
In case of third country nationals, the rights acquired shall be deemed to have been withdrawn if a
The term ‘eligible office’ refers to specific eligible employments or offices in a role directly connected
beneficiary physically stays in Malta, in the aggregate for more than 1,460 days or directly or indirectly
with the development of innovative and creative digital products. These specific eligible employments
acquires real rights over immovable property situated in Malta or holds a beneficial interest directly or
or offices are: Chief Executive Officer, Chief Technical Officer, Chief Creative Officer, Head of Writing,
indirectly, consisting of real rights over immovable property situated in Malta.
www.nexiabt.com
WHY NEXIA BT?
Nexia BT provides a wide range of services ranging from basic company incorporation and
compliance to specialised advisory services, audit, tax and accounting, for particular sectors
such as financial services, international trade, remote gaming, investment funds, shipping and
aviation. We offer international support including back office operations and advisory services,
in a responsive, proficient and professional manner.
Nexia BT can provide assistance for a portfolio of services in connection with the gaming
industry in Malta, including: incorporation and tax advice of the appropriate corporate
structures, assistance in the licensing application, provision of Key Official, tax compliance,
accounting, assurance and IT audit services. Whether you want to start-up your business
operations in Malta or you plan to relocate your established business to Malta, we are
committed to offer and devise a tailor made service to your company needs. We understand
that the gaming industry has specific needs and our services are intended to cater for them.
CONTACTS
For further information please contact:
Karl Cini
Partner
The Penthouse, Suite 2
Capital Business Centre
Entrance C, Triq taz-Zwejt
San Gwann SGN 3000
Malta EU
[email protected]
www.nexiabt.com
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T: +356 21637778 F: +356 21634383
The material has been prepared by professionals in the firm of Nexia BT. It is intended as a general guide only, and its application to specific situations will depend on the
particular circumstances involved. Accordingly, we recommend the readers seek appropriate professional advice regarding any particular problems that they encounter.
The information should not be relied upon as a substitute for such advice. While all reasonable attempts have been made to ensure that the information contained herein
is accurate, Nexia BT accepts no responsibility for any errors or omissions it may contain, whether caused by negligence or otherwise, or for any losses, however caused,
sustained by any person that relies upon it.
© 2015 Nexia International Limited. All rights reserved.
Nexia International is a leading worldwide network of independent accounting and consulting firms, providing a comprehensive portfolio of audit, accountancy, tax and advisory services. Nexia International is the trading name of Nexia International Limited, a company registered in the Isle of Man. Company registration number: 53513C. Registered office: 1st floor, Sixty Circular Road, Douglas,
Isle of Man, IM1 1SA. The trademarks NEXIA INTERNATIONAL, NEXIA and the NEXIA logo are owned by Nexia International Limited. Nexia International and its member firms are not part of a worldwide partnership. Member firms of Nexia International are independently owned and operated. Nexia International does not accept any responsibility for the commission of any act, or omission to
act by, or the liabilities of, any of its members.