Doubt about abroad income tax

You are mixing up lots of issues. You only pay tax in Malta  on income you earn in or remit to Malta. What other countries do about the income you earn in that country is a completely separate issue

georgeingozo wrote:

You are mixing up lots of issues. You only pay tax in Malta  on income you earn in or remit to Malta. What other countries do about the income you earn in that country is a completely separate issue

Thanks. So I don't have to pay any taxes in Malta, but should I pay any taxes in the country where that income is generated and kept, even if I'm spending more than 6 months per year in Malta and therefore being a resident of that country?

Residency and tax liability are different things. You are generally liable to taxation in the country income is earned in.

georgeingozo wrote:

Residency and tax liability are different things. You are generally liable to taxation in the country income is earned in.

I think that's not true if you aren't a resident. For example, I'm from Spain but now I'm residing in the United Kingdom, so I pay here for the income produced in Spanish bank accounts.

In the case of Malta it would mean not paying there because I don't remit money and not paying in the UK because I don't reside in the UK.

Hi chaos,

I also think you are mixing issues!

In particular what money are you going to live of in Malta? Taxed money you declare elsewhere and send yourself to Malta ? If you don't remit money to Malta what are you going to live off ? Where is the money you are earning being taxed ?

What income are you going to declare to gain residency? No income . no residency !


Lots of issues .....

Cheers
Ricky

ricky wrote:

Hi chaos,

I also think you are mixing issues!

In particular what money are you going to live of in Malta? Taxed money you declare elsewhere and send yourself to Malta ? If you don't remit money to Malta what are you going to live off ? Where is the money you are earning being taxed ?

What income are you going to declare to gain residency? No income . no residency !


Lots of issues .....

Cheers
Ricky

I'm talking about remitting just what I need to live in Malta, and my doubt is what would happen with the rest of income, if I can just leave it growing tax free abroad.

"Foreigners residing in Malta are not taxed on their worldwide income but only on Maltese source income and on foreign income remitted to Malta."

UK has it's own laws, and so does Spain ... and all other countries.

And I think the source from this text would be the perfect contact for your question.

Markus

I read some where... that you can only be taxed in the country you physically carry out the work in..but...if the income generated is never remitted to Malta..what happens .... i.e. because your working in one country and not working in another country, that country (not physically working but where the income gets paid) cant tax you, but also Malta (physically working) cant tax you either until you remit it.....a bit of  black hole by the sounds of it and am sure its not that easy.

what you live on and where it comes from is another matter!

toonarmy9752 wrote:

I read some where... that you can only be taxed in the country you physically carry out the work in

Not necessarily, it depends on the situation, the country you live in and are a citizen of, and whether the work is of a permanent or temporary basis.

For example, at one extreme,  Americans are liable to pay US tax on worldwide income no matter where they live.

There is no simple yes/no answer to the questions in the original post.

I guess thats true... being dependant on circumstances - it wasnt meant as a global statement just when I read this it was relating to an article about UK and Malta.

The OP didn't mention his citizenship, or where he is currently resident :-)

sounds like the OP from Spain living and working in the UK and looking to move to malta

I suspect you are right

steady on GnG

toonarmy9752 wrote:

steady on GnG

:-) problem is we advise so many people on this forum, that I've learnt not to assume - we are often not given important info as the OP didn't realise it was important


eg
are the shares held in an ISA ?
is the interest on the savings paid net or gross ?
are they onshore or offshore ?
is the OP married, are the accounts share etc in joint names ?
where is the poker company based ? on line or off line

absolutely - and we must also remember this is not professional advice just opinion based on information and any tax and legal matters should be pushed in the direction of a professional advisor

yep, free advice can often turn out to be very costly

toonarmy9752 wrote:

sounds like the OP from Spain living and working in the UK and looking to move to malta

That's right, sorry for not being more clear in my first post.

georgeingozo wrote:

toonarmy9752 wrote:

steady on GnG

:-) problem is we advise so many people on this forum, that I've learnt not to assume - we are often not given important info as the OP didn't realise it was important


eg
are the shares held in an ISA ?
is the interest on the savings paid net or gross ?
are they onshore or offshore ?
is the OP married, are the accounts share etc in joint names ?
where is the poker company based ? on line or off line

No, they aren't in an ISA. If I don't pay taxes for being in Malta, interests should be net. They come from UK accounts, not offshore ones. No, I'm not married (but it seems like I would have to marry to be able to reside in Malta with my girlfriend, as she would depend on me). The poker company is based in the Isle of Man and offers their services online(PokerStars).

By the way, I have found in another forum that possibly if I play poker professionally online in Malta, their government could consider that I'm generating that income in Malta, and therefore I would have to pay 15%-35%.

Chaos Orb wrote:

By the way, I have found in another forum that possibly if I play poker professionally online in Malta, their government could consider that I'm generating that income in Malta, and therefore I would have to pay 15%-35%.

Yep, I've heard the same. You should speak to a tax advisor to clarify as it depends on the circumstances

"If I don't pay taxes for being in Malta, interests should be net. "

Should be gross, as long as the bank allows it

and if you earn more than around 70k per year you can apply for a tax flat rate of 15% as "high qualified person" ... that'a a pretty nice rate for income tax;)

georgeingozo wrote:

"If I don't pay taxes for being in Malta, interests should be net. "

Should be gross, as long as the bank allows it

You are right.

matm911 wrote:

and if you earn more than around 70k per year you can apply for a tax flat rate of 15% as "high qualified person" ... that'a a pretty nice rate for income tax;)

Are you talking about the High Net Worth Individual Tax Residence Scheme? It seems like the requirements are different from earning X per year: http://www.mxpmalta.com/malta-high-net- … nce-scheme

I was talking about this, but as you can see, there exists a lot of differnet tax incentives in Malta

Chaos Orb wrote:

By the way, I have found in another forum that possibly if I play poker professionally online in Malta, their government could consider that I'm generating that income in Malta, and therefore I would have to pay 15%-35%.

I'd be interested in seeing what was said in that forum if you could provide a link. I was of the understanding that in Malta, just as in the UK, income from online poker was considered "gambling" and therefore not taxable. I sincerely hope that I'm not wrong on this.

TheDarkman wrote:

Chaos Orb wrote:

By the way, I have found in another forum that possibly if I play poker professionally online in Malta, their government could consider that I'm generating that income in Malta, and therefore I would have to pay 15%-35%.

I'd be interested in seeing what was said in that forum if you could provide a link. I was of the understanding that in Malta, just as in the UK, income from online poker was considered "gambling" and therefore not taxable. I sincerely hope that I'm not wrong on this.

It's a thread about trading, but the government could also consider poker winnings as income: http://www.trade2win.com/boards/home-tr … ncome.html

Thanks Chaos. That's an interesting read, but I don't think it's relevant to what we're doing. However, I don't want to get in deep before finding out that I'm wrong, so I'll be contacting the Maltese Inland Revenue department for clarification. I'll post their answer when I receive it.

Hi,

Could someone advise me with this? I moved away from Malta around a year ago when I quit my job on the island. I returned to my home country, which is an EU country as well. I kept my Maltese bank account as I had VISA card linked to it, which is something that I don't have in my home country. I've transferred some of my money (around 1000 eur in 2014) to my Maltese bank account from my bank account in my home country, in order to book flights & hotels etc, something that I am not able to do with my domestic card.

I've not been present in Malta for a year and in 2013 I was present for approximately 150 days. As the money I transferred to my Maltese account was my own money from my own account, am I subject to report anything to the Inland Revenue (the source of money is my income in my home country, made from employment in the home country & taxes are already paid there)? It is also worth mentioning that the Maltese account itself is now closed as I hardly used it.

Thanks!

j0nass wrote:

Hi,

Could someone advise me with this? I moved away from Malta around a year ago when I quit my job on the island. I returned to my home country, which is an EU country as well. I kept my Maltese bank account as I had VISA card linked to it, which is something that I don't have in my home country. I've transferred some of my money (around 1000 eur in 2014) to my Maltese bank account from my bank account in my home country, in order to book flights & hotels etc, something that I am not able to do with my domestic card.

I've not been present in Malta for a year and in 2013 I was present for approximately 150 days. As the money I transferred to my Maltese account was my own money from my own account, am I subject to report anything to the Inland Revenue (the source of money is my income in my home country, made from employment in the home country & taxes are already paid there)? It is also worth mentioning that the Maltese account itself is now closed as I hardly used it.

Thanks!

Sorry to ask, but are you a born worryer ?

I think you're looking for a problem that doesn't exist. Sleep easy on this one.

One question though. What made you transfer funds to your Maltese bank account rather than just paying the credit card company ?

TheDarkman wrote:

j0nass wrote:

Hi,

Could someone advise me with this? I moved away from Malta around a year ago when I quit my job on the island. I returned to my home country, which is an EU country as well. I kept my Maltese bank account as I had VISA card linked to it, which is something that I don't have in my home country. I've transferred some of my money (around 1000 eur in 2014) to my Maltese bank account from my bank account in my home country, in order to book flights & hotels etc, something that I am not able to do with my domestic card.

I've not been present in Malta for a year and in 2013 I was present for approximately 150 days. As the money I transferred to my Maltese account was my own money from my own account, am I subject to report anything to the Inland Revenue (the source of money is my income in my home country, made from employment in the home country & taxes are already paid there)? It is also worth mentioning that the Maltese account itself is now closed as I hardly used it.

Thanks!

Sorry to ask, but are you a born worryer ?

I think you're looking for a problem that doesn't exist. Sleep easy on this one.

One question though. What made you transfer funds to your Maltese bank account rather than just paying the credit card company ?

As a foreigner, I was only entitled to open a normal account with debit card and also a VISA, which worked in a way that it had a initial 'safe deposit' of sum X, and I was entitled to kinda borrow my own money till that limit. If I wanted to use more money, I had to 'load the card' with my own money. So in other words, almost like a prepaid Visa but still not a prepaid Visa.

Hi guys,

Another theoretical question for you all;

Assume that all your income is sourced from outside of Malta and therefore you remit all that you spend on the island and pay your taxes based on this amount.
However, the apartment you rent is owned by another foreigner and therefore you pay him directly from your foreign account to his foreign account. In other words that money never passes through Malta in any way.

Would this rental money that you 'consume' in Malta, because you live in the rented flat, need to be included in your  annual income tax declaration in Malta even though technically you never had these funds in Malta or drew them out of a Maltese ATM or paid via debit/credit card in Malta?

What's the view on this?