Income Tax Management Act, article 48
Malta tax refund calculator: what does the 6/7 tax refund pay back?
A Maltese company pays 35%: €35,000 on €100,000 of chargeable profit, leaving €65,000. A shareholder entitled to the 6/7ths refund claims €30,000 back after the dividend, so €95,000 reaches them and €5,000 of Malta tax remains: an effective 5%.
35%
tax on the chargeable income of every company, article 56(6) Income Tax Act
6/7ths
refund of Advance Company Income Tax on ordinary distributed profits
4 years
deadline for a refund claim, from the date the tax becomes eligible for refund
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Malta shareholder refunds on €100,000 of chargeable profit
Last updated
Each statutory refund fraction applied to the same company: €100,000 of chargeable profit, tax at 35%, the whole after-tax profit distributed, and the refund claimed by the shareholder. Every row is produced by the calculator's own formulas.
Company tax at 35% under article 56(6) of the Income Tax Act (Cap. 123). Refund fractions from article 48(4) and 48(4A) of the Income Tax Management Act (Cap. 372) as consolidated on 10 March 2026. Full distribution of after-tax profit assumed, with no double taxation relief claimed by the company, so the tax actually paid equals 35% of the profit and the statutory cap on the refund does not bite. Where a company has claimed double taxation relief, the tax actually paid is lower and the cap in the second proviso to article 48(4)(c) reduces the refund below the figures here. Effective rate is the Malta tax left after the refund, as a percentage of the original chargeable profit; tax payable by the shareholder in their own country is not included.
| Refund claimed | Company tax at 35% | Refund to shareholder | Malta tax left | Effective rate |
|---|---|---|---|---|
| 6/7ths, ordinary distributed profits | €35,000 | €30,000 | €5,000 | 5% |
| 5/7ths, passive interest and royalties | €35,000 | €25,000 | €10,000 | 10% |
| 2/3rds, foreign income account with DTR claimed | €35,000 | €23,333 | €11,667 | 11.67% |
| Full refund, participating holding | €35,000 | €35,000 | €0 | 0% |
| No refund, profits retained in the company | €35,000 | €0 | €35,000 | 35% |
- Malta charges every company 35% on chargeable income and grants relief only when profits are distributed: on €100,000 of profit the company pays €35,000 whatever refund the shareholder later claims.
- The 6/7ths refund returns €30,000 of a €35,000 Malta tax charge to the shareholder, leaving €5,000 and an effective Malta rate of 5% on distributed trading profits.
- Passive interest and royalties carry a 5/7ths refund rather than 6/7ths, leaving €10,000 of Malta tax on €100,000 of profit, an effective 10%.
- A refund claim must be made within four years of the date the tax becomes eligible for refund, and the Commissioner must pay within fourteen days of it becoming due, extendable by twelve months for due diligence verification.
Cite this page
“Malta shareholder refunds on €100,000 of chargeable profit”, Malta Tax Refund Calculator, https://maltataxrefundcalculator.com/ (updated 2026-08-15). Company tax at 35% under article 56(6) of the Income Tax Act (Cap. 123). Refund fractions from article 48(4) and 48(4A) of the Income Tax Management Act (Cap. 372) as consolidated on 10 March 2026. Full distribution of after-tax profit assumed, with no double taxation relief claimed by the company, so the tax actually paid equals 35% of the profit and the statutory cap on the refund does not bite. Where a company has claimed double taxation relief, the tax actually paid is lower and the cap in the second proviso to article 48(4)(c) reduces the refund below the figures here. Effective rate is the Malta tax left after the refund, as a percentage of the original chargeable profit; tax payable by the shareholder in their own country is not included.
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Related guides
Each one cites where its numbers come from.
- Malta's refundable tax credit system: how the 6/7ths refund is applied
The 6/7ths refund is of Advance Company Income Tax on a dividend from the Maltese taxed or foreign income account, claimed by a registered shareholder, not the company.
- Tax accounting rules in Malta: the five tax accounts
Final tax account, immovable property account, foreign income account, Maltese taxed account and untaxed account: how profits are allocated and which support a claim.
- Dividend tax in Malta: who can claim the corporate tax refund
Registration, the dividend certificate, the four-year claim deadline, the fourteen-day payment rule and the penalty for claiming a Maltese refund you are not due.
- Malta tax rebate: which refund are you looking for?
A Malta tax rebate can be the shareholder refund on a dividend, an individual's income tax refund or a property duty refund. What each is and when it is paid.
Behind the numbers
- The company rate is 35 cents on every euro of chargeable income for every company and body corporate, article 56(6) of the Income Tax Act (Cap. 123). There is no reduced Maltese company rate; the relief is entirely at shareholder level.
- The refund fractions are those in article 48(4) and 48(4A) of the Income Tax Management Act (Cap. 372). Six-sevenths of the Advance Company Income Tax applies on a dividend from the Maltese taxed account or the foreign income account.
- Five-sevenths where the profits are passive interest or royalties, or dividends from a participating holding that fails the article 12(1)(u) conditions. Two-thirds of the Malta tax where the dividend comes from the foreign income account and the company claimed relief of double taxation. A full refund where foreign income account profits derive from a participating holding or its disposal.
- The calculator applies the fraction to the tax pertaining to the profits actually distributed. Retained profits generate no refund until they are distributed, which is why the distribution percentage changes the answer.
- A statutory cap applies in both sub-articles: the refund shall in no case exceed the amount of tax actually paid by the company to the Commissioner on the distributed profits. Where double taxation relief reduced the tax paid, this tool's two-thirds figure can overstate the entitlement. Treat the 2/3rds line as an upper bound; have it computed on real numbers.
- The refund is a shareholder entitlement, claimable only by a person registered for the purpose in the prescribed manner. The Commissioner pays it not later than the fourteenth day after it becomes due. That can be extended by twelve months where further due diligence verification is required (article 48(8)).
- Not modelled: the company's own tax computation, allocation of profits between the five tax accounts, and tax accounted for under the investment income provisions. Nor the tax the shareholder pays in their own country of residence, or the EU global minimum tax for large groups. This tool computes a statutory fraction; not whether you qualify for it.
Malta Tax Refund Calculator is an information site. It is not affiliated with the Malta Tax and Customs Administration, the MFSA or any Maltese authority, and nothing here is tax, legal or investment advice. Figures are computed from the Income Tax Act and the Income Tax Management Act as published on legislation.mt at the updated date above; entitlement to any refund depends on facts a calculator cannot test, and on the tax rules of the country where the shareholder is resident.
Frequently asked
How does the Malta 6/7 tax refund work?
The company pays 35% on chargeable income. Under article 48(4A) of the Income Tax Management Act, a registered shareholder can reclaim six-sevenths of the Advance Company Income Tax on the dividend. That applies to dividends from the Maltese taxed or foreign income account. On €100,000 of profit, a €30,000 refund against €35,000 tax leaves €5,000, an effective 5% Malta rate.
When is the Malta refund 5/7ths rather than 6/7ths?
Where the dividend is paid out of profits consisting of passive interest or royalties. Or of dividends from a participating holding that does not satisfy the conditions in the proviso to article 12(1)(u) of the Income Tax Act. The proviso to article 48(4A)(a) sets five-sevenths in those cases, leaving an effective Malta rate of about 10%.
What is the 2/3rds refund for?
Under article 48(4), where double taxation relief has been claimed, two-thirds of the Malta tax paid on foreign income account profits distributed as a dividend can be refunded. The refund is capped at the tax actually paid to the Commissioner on those profits. So the arithmetic depends on how much relief was taken, and needs computing on real figures.
How long does a Malta tax refund take to be paid?
Article 48(8) of the Income Tax Management Act makes the refund a debt payable not later than the fourteenth day after it becomes due. It expressly allows a further twelve months where the Commissioner needs further due diligence verification. Plan cash flow for the longer case.
Is there a deadline for claiming?
Yes. Article 48(5) requires a claim under article 48(4) or 48(4A) not later than four years from the date the tax is eligible for refund. A late claim is simply out of time, however clearly the entitlement existed.
Does the refund apply to profits from Maltese property or rental income?
Not through these sub-articles. Profits taxed under the final withholding charges go to the final tax account. These include the property transfer tax in article 5A and the 15% option on rental income in article 31D. Profits from Maltese immovable property go to the immovable property account. Neither account appears in article 48(4) or 48(4A).
Sources
This site's own datasets, every figure quoted from its source and dated:
- The Malta Refund Fractions carries 4 published figures read from 4 sources' own pages; the 3 published figures given by income class run from 35 to 35 percent, read 7 November 2026.
- The Malta Tax Parameters carries 13 published figures read from 3 sources' own pages; the 10 published figures given by taxpayer category run from 35 to 35 percent, read 7 November 2026.
Model the refund before you build the structure
Every statutory fraction, applied to your own profit figure.
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