---
name: mt-capital-gains
description: "Use this skill for any question about capital gains tax in Malta. Trigger on: \"CGT Malta\", \"capital gains Malta\", \"sell shares Malta\", \"dispose of shares Malta\", \"Malta tax on investment gains\", \"sell company Malta\", \"Malta no capital gains\", \"crypto gains Malta\", \"Malta property transfer tax\". Covers the absence of CGT on securities, property transfer rules, and what IS subject to gain taxation in Malta. ALWAYS load before computing Malta tax on any asset disposal."
license: "AGPL-3.0-or-later (code) / OpenAccountants Guide License v1.0 (content)"
metadata:
  source: openaccountants
  openaccountants_url: "https://www.openaccountants.com/skills/mt-capital-gains"
  jurisdiction: "MT"
  tax_year: "2026"
  last_updated: "2026-10-16"
  authored_by: "Michael Cutajar and the OpenAccountants team"
  trust_label: "Built by Michael Cutajar and the OpenAccountants team"
  review_status: "pending_review"
---

# Malta capital gains: article 5 gains and the article 5A property transfer tax, for individuals and companies

## Scope ([Income Tax Act, Cap. 123](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

This skill covers how Malta taxes gains when an **individual** or a **company** sells or otherwise transfers a capital asset: immovable property, shares and other securities, a business or goodwill, intellectual property, an interest in a partnership, and a beneficial interest in a trust. It covers the final tax on transfers of Malta property (article 5A of the Income Tax Act), the main exemptions (including the own-residence exemption), non-residents and non-domiciled residents, and how the tax is paid and reported.

- **Primary year: basis year 2026 = year of assessment 2027.** Malta taxes the income of a calendar year (the basis year) in the following year of assessment.
- **Returns being filed now:** gains made in 2025 (year of assessment 2026). See "Filing and payment".

**Malta does tax capital gains.** There is no separate capital gains tax act. Instead, article 5 lists the assets whose gains are taxable, and says those gains "shall be charged under article 4(1)". An article 5 gain is added to the person's chargeable income and taxed at their normal rates. Malta property is different: most transfers of Malta property fall under article 5A, which charges a **final tax on the transfer value** (usually 8%, [ITA art. 5A(5)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c)), not on the gain. Assets that are not in the article 5 list (for example cars, art, coins held as an investment) are outside the charge unless the profit is trading income.

**What we could not check.** The Malta Tax and Customs Administration (MTCA) site, mtca.gov.mt, refused our automated source checks on 25 September 2026. Everything below is sourced from the Laws of Malta (legislation.mt). Points that depend on MTCA forms, guidance or subsidiary rules we could not read are marked **"check"**.

**Related Skills.** Rate tables for individuals: malta-income-tax. Crypto-assets: mt-crypto-tax. Non-domiciled residents: mt-non-dom.

## Ask the client first

- **What exactly was transferred?** Malta property, foreign property, shares (Maltese or foreign, listed or not), fund units, a business, IP, a partnership interest, a trust interest? Sold, donated, exchanged, partitioned, inherited?
- **Who is the transferor?** An individual, a company, a partnership, a trustee?
- **Residence and domicile** of an individual in the year of the transfer: resident and domiciled, resident but not domiciled or not ordinarily resident, or not resident?
- **Dates.** Date of the transfer (deed date), date and way of acquisition (purchase, inheritance and the date of death, donation and its date). For Malta property: acquired before 1 January 2004? Was a promise of sale (konvenju) notified to the Commissioner before 17 November 2014?
- **Amounts.** Consideration, market value at transfer, and for article 5 assets the cost of acquisition and costs of the transfer.
- **Own home?** Did the client own **and** live in the property as their only or main residence for at least three consecutive years right before the sale, and is the sale within 12 months of moving out? If they held it for less than three years: did the deed of acquisition declare it was bought as their sole ordinary residence, is the sale within three years of acquisition, and do they own any other residential property at the sale (the 2% rate, [ITA art. 5A(5)(g)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))?
- **Development and projects.** Was the property developed into more than one unit? Any works needing a development permit in the last five years? Did a related person own it as part of a project in the last five years?
- **Trade or investment?** Does the client buy and sell property or shares as a business, or did they buy this asset in order to resell it at a profit?
- **Company facts** (for shares): is the company a "property company" (it owns Malta immovable property, directly or through other entities)? Is the holding a participating holding? Are the shares listed on a stock exchange recognised by the Commissioner?
- **Losses** brought forward from earlier article 5 transfers.

## The method, step by step

Sources: [Income Tax Act, Cap. 123](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c) and [Income Tax Management Act, Cap. 372](https://legislation.mt/getpdf/69c65a5c7da36921dcc4f04b).

1. **Trading or capital?** If the asset was bought "for the purpose of profit-making by sale", or the client trades in such assets, the profit is trading income under article 4(1)(a), taxed at normal rates. A gain taxed as trading income "shall not be chargeable again as capital gains" (article 5(11)). For Malta property, article 5A still decides the tax on the transfer itself; refer property dealers.
2. **Is it Malta immovable property?** If yes, go to article 5A (step 3). Article 5A applies to "any immovable property situated in Malta and any right over such property", for transfers made on or after 1 November 2005, by anyone (individual or company, resident or not).
3. **Article 5A.** First check the exemptions in article 5A(4) (own residence, family donations, separation and divorce, intra-group, trusts). Then check the exclusions in article 5A(3) (for example the non-resident exclusion in 5A(3)(h), or a business-asset rollover). Otherwise pick the rate from the rate table below and apply it to the transfer value (or, in the inheritance case, to the gain). The tax is final.
4. **Is it an article 5 asset?** Foreign immovable property, "securities", a business, goodwill, business permits, copyright, patents, trademarks, trade-names, other IP, a partnership interest or a trust beneficial interest. If not, and it is not trading income, the gain is not taxed.
5. **Check the reliefs** for article 5 assets: listed shares (article 5(6)(b)), non-residents (article 12(1)(c)(ii)), foreign gains of non-doms (article 4(1), proviso (ii)), companies' participating holdings (article 12(1)(u)), group transfers, reorganisations and business incorporations (article 5(9), (14), (15)).
6. **Compute the gain.** Transfer price less cost of acquisition and allowable costs (article 5(2) and (3)). Set off article 5 losses brought forward.
7. **Pay provisional tax** of 7% within fifteen days of a non-5A transfer, unless an exception applies ([ITMA art. 43](https://legislation.mt/getpdf/69c65a5c7da36921dcc4f04b)).
8. **Report and settle.** Add the gain to chargeable income for the year and file the return. The provisional tax is set against the final liability.

## Figures and years ([Income Tax Act art. 5A](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

### Malta property: article 5A rates, transfers made on or after 1 January 2015, unchanged for 2026 and 2025 ([ITA art. 5A(5)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

Rates apply to the **transfer value**, which "is the higher of the market value of that property and the consideration paid or payable for the transfer" (article 5A(6)(a)), except the inheritance and donation row, which is charged on the gain.

| Transfer | Rate | Provision |
| --- | --- | --- |
| General rule | 8% of transfer value | 5A(5)(a), first proviso |
| Not part of a project, transferred not later than five years after acquisition | 5% of transfer value | 5A(5)(e) |
| Acquired before 1 January 2004 (no promise of sale notified before 17 November 2014), other than inherited or donated property under 5A(5)(b) | 10% of transfer value | 5A(5)(f) |
| Individual (or two co-owners) declared in the deed of acquisition that it was bought as their sole ordinary residence, transferred not later than three years after acquisition, and they own no other residential property at the transfer | 2% of transfer value | 5A(5)(g) |
| Inherited on a death after 24 November 1992, or received by donation more than five years before the transfer (not a project) | 12% of (transfer value − acquisition value), unless the transferor elects otherwise | 5A(5)(b) |
| Inherited on a death before 25 November 1992, or inherited and sold by judicial sale by auction | 7% of transfer value | 5A(5)(c) |
| Property restored under the article 31C restoration scheme | 10% of transfer value | 5A(5)(d) |
| Property in an urban conservation area or scheduled, restored under a permit applied for on or after 1 January 2015, works certified, transfer on or after 1 January 2016; the transferor declares the works to the notary; this rate and the 31C rate were "not applied in respect of any previous transfer of the same property"; the certificate goes to the notary and the Commissioner, with any forms required | 5% of transfer value | 5A(5)(h) |
| Legacy cases: property in a project or special designated area, or acquired before 2004, where a promise of sale was notified before 17 November 2014 | 12% of transfer value | 5A(5)(a), (f) |

**Which rule wins.** Work in this order:

1. Exemptions (5A(4)) and exclusions (5A(3)).
2. Inheritance and donation rows (5A(5)(b), (c)).
3. The pre-2004 10% (5A(5)(f)), which applies "notwithstanding the previous paragraphs (a), (d) and (e)". It overrides the 8% row, the 31C row and the 5% row only. It does **not** override 5A(5)(b). So property inherited on a death between 25 November 1992 and 31 December 2003 still pays 12% of the gain, unless the transferor elects out of 5A(5)(b); the 10% of transfer value then applies.
4. Then the 5%, 2%, restored-property and housing-scheme rows, and otherwise 8%.

**Loss of the 5% rate** (article 5A(5)(e) provisos). The 5% rate does not apply if, in the five years before the transfer:

- a person related to the transferor owned the property and it formed part of a project at that time; or
- the transferor or a related person carried out works that needed a development permission under the Development Planning Act, unless the transferor bought it as their sole ordinary residence and declared this in the deed of acquisition.

**Housing-scheme leases** (article 5A(5)(i), transfers on or after 1 January 2022). Where the property was leased for at least ten years ending on the date of the transfer, and for that whole period the tenant was entitled to a benefit under the Private Rent Housing Benefit Scheme, the Nikru Biex Nassistu Scheme or the Rehabilitation of Vacant Dwellings for Rent Scheme:

- transfer to the tenant: "no tax shall be chargeable on the first two hundred thousand euro (€200,000) of the transfer value"; the excess is taxed at the normal rate;
- transfer to someone else: half the normal rate on the first €200,000, normal rate on the excess;
- lease or benefit period at least three but under ten years: half the normal rate on the first €200,000.

A Housing Authority certificate of the benefit period must be produced to the notary.

**Donations within five years.** A person who received the property by donation five years or less before the transfer is treated as having acquired it on the date the donor acquired it (article 5A(5)(b), third proviso). The rate then follows the donor's acquisition date.

### Article 5 gains and related figures ([Laws of Malta](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

| Item | Figure | Year | Source |
| --- | --- | --- | --- |
| Company rate on chargeable income (includes article 5 gains) | 35% ("thirty-five cents (0.35) on every euro") | 2026 and 2025 | ITA art. 56(6) |
| Transfer of a beneficial interest in a trust that includes taxable trust property (assets whose direct transfer by the beneficiary would be taxable) | 35% of the consideration, no deductions | 2026 and 2025 | ITA art. 5(19)(a)-(c) |
| Provisional tax on non-5A transfers | 7% of the consideration (or of the higher of market value and consideration for a controlling interest in securities or a partnership interest), within fifteen days | 2026 and 2025 | ITMA art. 43(1)(b) |
| Provisional tax on securities in a property company | as prescribed, not exceeding 35% of the higher of market value and consideration | 2026 and 2025 | ITMA art. 43(1)(b) |
| Reduced provisional tax on request | allowed if the gain is less than 20% of the consideration | 2026 and 2025 | ITMA art. 43(3) |
| Article 5A tax payment | within fifteen working days of the transfer | 2026 and 2025 | ITA art. 5A(11) |
| Interest on late tax (including article 5A tax) | 0.6% for every month or part of a month, capped at the tax | tax due on or after 31 August 2022 | ITMA art. 44; ITA art. 5A(12)(g) |
| Commissioner's order on under-declared value | only if the declared value is less than 85% of market value, and within twelve months of notification; the order adds additional tax equal to the shortfall, on top of the correct tax | 2026 and 2025 | ITA art. 5A(12)(d)-(f) |
| Participating holding (companies) | at least 5% of the equity shares, among other tests | 2026 and 2025 | ITA art. 2(1) |
| Duty on transfer of immovable property | 5% of the higher of consideration and value | 2026 | Duty on Documents and Transfers Act art. 32(1) |
| Duty on transfer of marketable securities | 2%, plus 3% more where 75% or more of the company's assets are immovable property | 2026 | Duty on Documents and Transfers Act art. 42 |

### Individual rates for article 5 gains ([Act III of 2026](https://legislation.mt/getpdf/69d8ed326fe5fd3994d17430))

An individual's article 5 gain is added to chargeable income and taxed at the normal rates. **Resident individual, single table, basis year 2026 (year of assessment 2027):** tax = chargeable income × rate − subtraction.

| Chargeable income | Rate | Subtract |
| --- | --- | --- |
| Not over €12,000 | 0% | nil |
| Over €12,000 and under €16,000 | 15% | €1,800 |
| Over €16,000 and under €60,000 | 25% | €3,400 |
| Over €60,000 | 35% | €9,400 |

For 2025 gains (year of assessment 2026) the single table in [Act IX of 2025](https://legislation.mt/getpdf/6811d803cf7b7f36a4f360f5) has the same bands and subtractions. Married, parent and non-resident tables differ: use malta-income-tax.

## Article 5A exemptions and exclusions ([Income Tax Act art. 5A(3) and (4)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

**No tax is chargeable** (article 5A(4)) on these transfers, among others:

- **Own residence (5A(4)(c)).** All of these must be met:
  - a dwelling house, not forming part of a project;
  - owned **and** occupied by the transferor as their own residence "for a period of at least three consecutive years immediately preceding the date of transfer";
  - disposed of "within twelve months of vacating the premises or such other period or condition as may be prescribed" (prescribed variations: check);
  - declared by the transferor to be their main residence through an election to the Commissioner (form and manner: check).

  "Own residence" means the principal residence, the owner's "only or main residence", with garden or grounds needed for its reasonable enjoyment, and a garage attached to it or of not more than seventy square metres within five hundred metres, transferred on the same deed (article 5(5)(c)). Absences abroad for work, holiday, study, illness or care count as residence if the premises are not used for anything else meanwhile. A part used exclusively for commercial purposes within two years of the transfer is excluded proportionately. Periods count from a spouse or direct ascendant from whom the property was inherited, and from a spouse who assigned it on separation. If only an undivided share qualifies, the exemption is restricted proportionately. On divorce or separation, the house counts as vacated only when the other spouse also stops occupying it.
- **Family donations (5A(4)(a)).** A donation to a spouse, a descendant or ascendant in the direct line or their spouse, or, if there are no descendants, to a brother or sister or their descendant; or to an approved philanthropic institution. On a later sale the donee takes the donor's acquisition date.
- **Separation and divorce (5A(4)(d)-(e)).** Assignments between spouses on separation or divorce, and on dissolving the community of acquests.
- **Intra-group and restructuring (5A(4)(f)-(g)).** Transfers between companies that qualify for group relief under article 5(9), and a business incorporated into a company under article 5(15). A company that leaves the group within six years is charged 8% (10% if acquired before 2004) on the value at which it took the property (article 5A(12A)). Refer.
- **Trusts (5A(4)(h)), exempt persons (5A(4)(i)), and 95% shareholder liquidation transfers (5A(4)(j))**, each with conditions: refer.

**Outside article 5A** (article 5A(3)), so article 5 and the 7% provisional tax apply instead, in these main cases:

- **Non-resident taxed abroad (5A(3)(h)).** A person not resident in Malta who gives the notary a statement from their home tax authority confirming residence and that they are taxed there on gains from Malta immovable property. It does not apply if the person is owned or controlled by, or acts for, Malta-resident individuals. Provisional tax paid on such a transfer from 1 January 2015 is not refundable.
- **Business-asset replacement (5A(3)(g)).** Property used in a business for at least three years and replaced within one year by property used solely for a similar purpose, if the transferor elects. The gain reduces the cost of the new property (article 5(8)). The relief is lost if the replacement is disposed of or stops being used in the business within two years.
- **Judicial sale by auction or winding up by the Court (5A(3)(f)).**
- **The twelve-year election (5A(3)(b))** is closed for new transfers: from 1 January 2015 it needed a promise of sale notified before 17 November 2014 and a transfer before 1 January 2016.


## Article 5 assets: computing the gain ([Income Tax Act art. 5](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

**What is an article 5 asset.** Gains or profits from a "transfer" (sale, exchange, donation, settlement on trust, redemption or cancellation of fund units, distributions in a winding up, and more; not a transfer causa mortis) of:

- immovable property (in practice, foreign property, and Malta property outside article 5A);
- "securities, business, goodwill, business permits, copyright, patents, trademarks and trade-names and any other intellectual property";
- a beneficial interest in a trust;
- an interest in a partnership.

**"Securities"** means "shares and stocks and such like instrument that participate in any way in the profits of the company and whose return is not limited to a fixed rate of return", units in a collective investment scheme, and units relating to linked long-term insurance. So an ordinary bond or a preference share with a fixed return is not an article 5 security, and a non-trading gain on it is not taxed.

**Cost and deductions.**

- *Immovable property (article 5(2)(a)):* deduct the cost of acquisition, the inflation element, ground-rent not otherwise deducted, maintenance, improvements, other expenses that increased the value, and expenses directly related to the transfer, "in such manner and amount as may be prescribed".
- *Shares (article 5(3)):* shares acquired after 25 November 1992 at cost of acquisition. Shares paid up out of reserves (other than profits available for distribution or a capital redemption reserve) have a nil cost. Older shares have special valuation rules: refer.
- *Donations (article 5(2)(e)-(f)):* a donation is a deemed sale at market value, except to close family or approved charities. If the donee sells within five years, the donor's cost is used.
- *Partial transfers (article 5(13)(a)):* cost is apportioned by the consideration over the market value of the whole asset.

**Losses (article 5(10)).** A capital loss is computed like a gain. It "shall not be set off against other income for the year of assessment but shall be carried forward and set off against capital gains in respect of subsequent years of assessment until the full loss is absorbed". Losses on article 5A transfers are never deductible (article 5A(9)(b)).

**Main reliefs for shares.**

- **Listed shares (article 5(6)(b)).** The capital gains rule does not apply to "transfer of shares listed, or in consequence of a listing, on a stock exchange recognised by the Commissioner", other than fund units. Whether a given exchange is recognised: check.
- **Share-for-share reorganisations (article 5(14))** and **group transfers (article 5(9))** are treated as no gain, no loss, on prescribed conditions. Refer.
- **Property companies.** Shares in a company that owns Malta property carry extra rules: an intra-group exemption lost if the group breaks up within six years (article 5(9A)), higher provisional tax, and no non-resident exemption. Refer.

**Trust beneficial interests (article 5(19)).** This rule applies only to a trust that includes "taxable trust property": assets whose transfer, "had it been carried out directly by the relevant beneficiary, would have given rise to gains or profits chargeable to tax". The gain is "equal to the consideration" declared in the transfer instrument, with no deductions, taxed at the article 56(6) rate (35%) with no relief or credit. The transferor must give the trustee a copy of the instrument within forty-five days, and the trustee collects the tax and pays it by the fourteenth day after the end of the month of collection. The gain is not declared in the transferor's return.

**Partnership interests (article 5(1)(a)(v)).** A transfer of a full or partial interest, and a deemed transfer when a partner acquires or increases a partnership share, are article 5 transfers.

## Residence, domicile and non-residents ([Income Tax Act art. 4(1) and 12(1)(c)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

| Person | Malta property | Article 5 gains arising in Malta | Article 5 gains arising outside Malta |
| --- | --- | --- | --- |
| Resident and domiciled individual | Article 5A | Taxed | Taxed (worldwide) |
| Resident, not domiciled or not ordinarily resident | Article 5A | Taxed | Not taxed, even if brought to Malta (art. 4(1), proviso (ii)) |
| Non-resident individual or company | Article 5A (or 5A(3)(h) exclusion) | Taxed, unless exempt under art. 12(1)(c)(ii) | Not taxed |
| Company incorporated in Malta | Article 5A; profits go to the final tax account | Taxed at 35% | Taxed at 35%, subject to the participation exemption |

A company managed in Malta but incorporated abroad (resident, not domiciled) is taxed on foreign income only when received in Malta, and on foreign capital gains not at all (art. 4(1) provisos). Refer.

- **Non-domiciled residents.** "No tax shall be payable on capital gains arising outside Malta to a person who is not ordinarily resident in Malta or not domiciled in Malta". This is broader than the remittance rule for foreign income: foreign capital gains stay untaxed even if remitted. The €5,000 minimum tax applies only to a non-dom whose income arising outside Malta is at least €35,000 and is not received, or not fully received, in Malta. It counts other tax paid under the Act towards the minimum, but not article 5A tax ([ITA art. 56(27)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c)). See mt-non-dom.
- **Non-residents and Maltese shares (article 12(1)(c)(ii)).** Exempt: gains of a person not resident in Malta on a transfer of units in a collective investment scheme, linked long-term insurance units, an interest in a partnership that is not a property partnership, "and any shares or securities in a company ... which is not a property company". Condition: the beneficial owner is not resident in Malta and "is not owned and controlled by, directly or indirectly, nor acts on behalf of an individual or individuals who are ordinarily resident and domiciled in Malta".
- **"Property company"** means a company that owns Malta immovable property or real rights over it, or holds interests in an entity that does, where five percent or more of the value of those interests is attributable to that property. A trading company that owns only its own factory, showroom, warehouse or office is not a property company if Malta property is not more than fifty percent of its assets and it has no income from Malta property (article 2(1)).
- **Leaving Malta.** We found no article in the Income Tax Act that charges an individual on unrealised gains when they stop being resident. After leaving, the person stays taxable on Malta property (article 5A) and on shares in Malta property companies. Company exit taxation (anti-tax-avoidance rules outside the Act): check.
- **Double tax treaties** may change who taxes a gain, especially on shares. Refer any treaty claim.

## Companies ([Income Tax Act art. 5, 12(1)(u) and 56(6)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

- **Rate.** A company's article 5 gains form part of its chargeable income, taxed at 35% ([ITA art. 56(6)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c)). Shareholder refunds on distributions are outside this skill.
- **Malta property.** A company selling Malta property pays article 5A tax like anyone else. It must allocate the distributable profits from that transfer to its final tax account (article 5A(10)(d)).
- **Participation exemption (article 12(1)(u)).** Gains of a company registered in Malta "from a participating holding or from the transfer of such holding" are exempt where the company does not show them as chargeable income. A participating holding includes a direct holding of "at least five percent of the equity shares" carrying at least five percent of any two of votes, profits and assets on a winding up, and other tests in article 2(1). The anti-abuse conditions in 12(1)(u) apply to dividends; gains on holdings in property companies raise extra questions. Refer.
- **Group relief, reorganisations and incorporations** (article 5(9), (14), (15)): no gain, no loss on conditions; base cost and acquisition date carry over. Refer.

## Boundary and exception table ([Income Tax Act art. 5 and 5A](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

| Situation | Treatment | Why |
| --- | --- | --- |
| Own home owned and lived in for three consecutive years, sold 11 months after moving out, main residence election made | Exempt | 5A(4)(c) |
| Same, but sold 13 months after moving out | Taxed at the normal 5A rate (8%, or 5% or 10% if those rows apply) | Outside "within twelve months of vacating" |
| Own home lived in for 2 years 10 months | Not exempt. 2% of transfer value if the deed of acquisition declared it their sole ordinary residence, the sale is within three years of acquisition and they own no other residential property; otherwise 5% (within five years), else 8% | Less than "at least three consecutive years"; 5A(5)(g), (e) |
| Flat bought, not lived in, sold four years later, no permit works | 5% of transfer value | 5A(5)(e) |
| Same, but the owner did works needing a development permit | 8% of transfer value | 5A(5)(e), second proviso |
| Bought in 2001, sold in 2026 | 10% of transfer value | 5A(5)(f) |
| Inherited from a parent who died in 2012 | 12% of the gain, unless the transferor elects out of 5A(5)(b); then the rate on transfer value applies | 5A(5)(b) |
| Inherited from a parent who died in 1990 | 7% of transfer value | 5A(5)(c) |
| Price declared below market value | Tax on market value; order possible if declared value is under 85% of market value | 5A(6)(a), 5A(12)(d) |
| Unlisted shares in a Maltese trading company, resident domiciled seller | Article 5 gain at normal rates; 7% provisional tax | 5(1)(a)(ii); ITMA 43 |
| Shares listed on a recognised exchange | Outside the capital gains rule | 5(6)(b) |
| Non-resident sells shares in a Maltese non-property company | Exempt, if not owned or controlled by Malta ordinarily resident and domiciled individuals | 12(1)(c)(ii) |
| Non-resident sells shares in a Maltese property company | Taxable article 5 gain | 12(1)(c)(ii) excludes property companies |
| Non-dom sells shares in a foreign company, proceeds brought to Malta | Not taxed | 4(1), proviso (ii) |
| Fixed-rate bond sold at a gain, not trading | Not taxed | Not "securities" |
| Car, boat or art sold at a gain, not trading | Not taxed | Not in the article 5 list |
| Coins held as an investment | Not taxed; see mt-crypto-tax | Not in the article 5 list |
| Loss on shares | Carried forward against future capital gains only | 5(10)(b) |

## Worked cases ([Income Tax Act art. 5 and 5A](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

All amounts are hypothetical. Transfers are in basis year 2026 unless stated.

**Case 1: investment flat, held more than five years.** Bought in 2019, never lived in, no permit works, not part of a project. Sold in September 2026 for €320,000; market value is not higher.
- Not within five years, acquired after 2003, so the general rate applies.
- Tax: 8% × €320,000 = €25,600, final, paid through the notary within fifteen working days.
- The gain is irrelevant, and the tax is not declared as income.

**Case 2: flat sold within five years.** Bought in 2023, sold in 2026 for €250,000. No works needing a permit, and no related person held it as part of a project.
- Tax: 5% × €250,000 = €12,500.
- If the owner had done permit works in the five years, 8% × €250,000 = €20,000.

**Case 3: inherited house.** Inherited from a parent who died in 2010. Assume the acquisition value, determined as prescribed, is €150,000. Sold in 2026 for €300,000.
- Death after 24 November 1992, so article 5A(5)(b) applies unless the transferor elects out.
- Tax: 12% × (€300,000 − €150,000) = 12% × €150,000 = €18,000.
- If the transferor elected out, the general rule would give 8% × €300,000 = €24,000. The election would cost more here.
- Confirm with the notary how the acquisition value is determined (subsidiary rules: check).

**Case 4: property acquired before 2004.** Bought in 1998, no promise of sale notified before 17 November 2014, sold in 2026 for €400,000.
- Tax: 10% × €400,000 = €40,000.

**Case 5: own home.** Owned and lived in since 2018 as the only residence, moved out in March 2026, sold in November 2026, main residence election made.
- At least three consecutive years of ownership and occupation right before the transfer, and sold within twelve months of moving out: exempt under article 5A(4)(c).
- If sold in April 2027 (13 months after moving out), the exemption fails. The property was acquired in 2018, more than five years before, so 8% of transfer value applies.

**Case 6: unlisted shares, resident individual.** A resident, domiciled, single individual with no other income sells shares in a Maltese trading company that is not a property company. Cost €20,000 (bought in 2015), sale price €70,000 (market value), not a controlling interest.
- Gain: €70,000 − €20,000 = €50,000, an article 5 gain added to chargeable income for basis year 2026.
- Tax, single table 2026: €50,000 × 25% − €3,400 = €12,500 − €3,400 = €9,100.
- Provisional tax within fifteen days: 7% × €70,000 = €4,900.
- Balance due with the return by 30 June 2027: €9,100 − €4,900 = €4,200. The €4,900 is credited only if the gain is declared in the return.

**Case 7: non-resident selling Maltese shares.** An individual resident in another country, not controlled by anyone ordinarily resident and domiciled in Malta, sells shares in a Maltese software company that owns no Malta property.
- Exempt under article 12(1)(c)(ii). To avoid the 7% provisional tax, file the prescribed form claiming the exemption (ITMA art. 43(2)(a); form: check).
- If the company owned its Malta office and Malta property was more than fifty percent of its assets, it would be a property company: the exemption fails and the gain is taxable. Refer.

**Case 8: losses.** In 2025 a resident made a €10,000 loss on unlisted shares. In 2026 they made a €15,000 gain on other unlisted shares.
- The 2025 loss cannot reduce 2025 salary. It is carried forward.
- 2026 taxable capital gain: €15,000 − €10,000 = €5,000.

**Case 9: company with a participating holding.** A Maltese company sells its whole holding in an EU subsidiary (not a property company) at a gain of €200,000.
- Exempt under article 12(1)(u) if the company does not show the gain as chargeable income.
- The prescribed form does not remove provisional tax if article 33 applies as a result of claiming 12(1)(u) (ITMA art. 43(2)(a), proviso). Refer.
- If the exemption did not apply, tax would be 35% × €200,000 = €70,000.

## When to refuse or refer

Refuse to give a rate for a Malta property transfer until you know: the acquisition date and method, whether it is part of a project, any permit works or related-party project in the last five years, the own-residence facts, and for a sale within three years of acquisition whether the deed declared it the sole ordinary residence and whether the seller owns any other residential property.

Refer:

- property dealers and developers, projects, and anyone whose profit may be trading income;
- transfers by or of shares in property companies, and any intra-group, reorganisation, incorporation or group-exit case (articles 5(9), 5(9A), 5(14), 5(15), 5A(12A));
- trusts, partnerships, capital reductions and value-shifting (articles 5(13)(b), 5(18)-(25));
- promise-of-sale (konvenju) assignments, which are not article 5A transfers (article 5A(2)(d)), partitions with owelty, emphyteusis and usufruct;
- non-residents relying on article 5A(3)(h) or on a double tax treaty;
- shares acquired before 25 November 1992, share options, and share reductions;
- company exit taxation and participation exemption questions on property companies;
- any case turning on an MTCA form, guideline or rule we could not read.

Do not:

- say Malta has no tax on gains from shares. Article 5 taxes them, subject to the reliefs above;
- apply the own-residence exemption without all of: three consecutive years, sale within twelve months of moving out, and the main residence election;
- apply 7% to all inherited property. 7% needs a death before 25 November 1992 or a judicial sale by auction ([ITA art. 5A(5)(b)-(c)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c));
- treat 10% for pre-2004 property as optional or as a tax on the gain. It is on transfer value, except inherited property under 5A(5)(b), which stays at 12% of the gain unless the transferor elects out ([ITA art. 5A(5)(f)](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c));
- set a capital loss against salary or business income.

## Filing and payment ([Income Tax Management Act art. 43](https://legislation.mt/getpdf/69c65a5c7da36921dcc4f04b))

| What | When | Source |
| --- | --- | --- |
| Article 5A tax on Malta property | Due by the transferor; remitted "within fifteen working days of the relative transfer", normally by the notary on the deed | ITA art. 5A(11) |
| Provisional tax on other transfers (article 5 assets, and property outside 5A) | Within fifteen days of the transfer | ITMA art. 43(1)(b) |
| No provisional tax | Exempt transfers where the prescribed form is filed (but still due where article 33 applies as a result of claiming 12(1)(u)); partition deeds; shares in public companies | ITMA art. 43(2) |
| Individual return declaring 2026 article 5 gains | 30 June 2027; tax due the same day | [S.L. 372.16](https://legislation.mt/getpdf/6022595cbc8272018c0f2ad2) rules 2(c)(ii), 5(b) |
| Individual return for 2025 gains | Was due 30 June 2026. MTCA usually announces a later date for online filing: check | S.L. 372.16 rule 2(c)(ii) |
| Company return | Later of the last day of the ninth month after the accounting period ends and 31 March of the year of assessment | S.L. 372.16 rule 2(c)(i) |
| Trust beneficial interest transfer | Transferor to trustee within forty-five days; trustee pays by the fourteenth day after the end of the month of collection | ITA art. 5(19)(d)-(e) |
| Late tax | 0.6% a month or part of a month, capped at the tax | [ITMA art. 44](https://legislation.mt/getpdf/69c65a5c7da36921dcc4f04b); ITA art. 5A(12)(g) |
| Commissioner's order on an article 5A transfer | Within six years from the end of the year the transfer is notified; for undervalue only, within twelve months. Additional tax equal to the shortfall is payable on top of the correct tax | ITA art. 5A(12)(d) |

**Reporting.** Article 5A tax is final: the transferor "shall not be required to declare any such income" in a return (ITMA art. 43(4)(a)), and it is not a credit against other tax. Article 5 gains are declared in the return for the year of assessment after the transfer; the provisional tax is set off only if the gain is declared (ITMA art. 43(4)(b)).

**Records.** Every owner of Malta immovable property must keep an account of all proceeds and expenditure on article 5A transfers (ITA art. 5A(10)(c)). Keep deeds, valuations, cost records and loss computations.

**Duty.** Separate from income tax. Duty on documents is charged on a transfer of immovable property at 5% of the higher of consideration and value (Cap. 364 art. 32(1)), and on marketable securities at 2% (art. 42). Reliefs and who bears the duty: see the [Duty on Documents and Transfers Act](https://legislation.mt/getpdf/68c1374a22d5d32e6c111563) or refer.

## Completion checklist ([Income Tax Act, Cap. 123](https://legislation.mt/getpdf/69d8a9187da37f0580d5140c))

- Asset identified and classified: Malta property (article 5A), article 5 asset, or outside the charge.
- Trading versus capital decided and recorded.
- Transferor's residence, domicile and ordinary residence for the year recorded.
- For Malta property: exemption tested, exclusion tested, rate row chosen with the reason, transfer value = higher of market value and consideration.
- Own-residence conditions evidenced: three consecutive years, sale within twelve months of moving out, election.
- For article 5 gains: cost, allowable costs and losses brought forward computed; reliefs (listed, non-resident, non-dom, participation) tested.
- Property-company status checked for any share transfer.
- Provisional tax paid within fifteen days, or the exemption form filed.
- Return for the year of assessment filed with the gain declared; balance paid.
- Duty on the deed considered.
- Every "check" item confirmed with MTCA or referred.

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## Today's figures and who stands behind this skill

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