Malta and Italy signed their first double taxation agreement in 1948. The convention contains provisions about the avoidance of double taxation with respect to the following taxes:
The agreement was amended in 2011 and now contains provisions about the prevention of fiscal evasion. The new Malta-Italy double taxation agreement also covers the regional tax on productive activities in Italy.
The new double tax treaty between Malta and Italy was amended with five articles meant to update the economic relations between the two countries and to promote investments in Malta and Italy. The new agreement replaces the elimination of double taxation with a new article referring to the taxation of Italian and Maltese residents by first determining which incomes are taxable in each state, while the old treaty provided for the taxation of individuals based on the tax residency.
The new double taxation agreement provisions the Italian tax authorities will deduct the income tax paid in Malta by an Italian resident. The Maltese taxation system is based on tax credits for the taxes paid in other countries, when it comes to the elimination of double taxation. The Malta-Italy double taxation agreement also provisions that each country will inform the other about any alterations to their taxation systems. Our Maltese agents may provide you with information about the country’s taxation system.
The double taxation treaty Malta signed with Italy also contains provisions about the exchange of tax information as it is based on the Organization for Economic Co-operation and Development model. The agreement establishes the Italian and Maltese tax authorities will exchange tax information relevant for the purpose of the treaty or to the administration of the tax legislation.
The exchange of information has the scope of preventing fiscal evasion in both countries. Also, all information collected will be confidential and will only be disclosed to the authorities and courts.
For additional information about the double taxation treaty with Italy, you may contact our agents in Malta.