Malta Tax rebate for pensioners

John Huber & associates

By means of LN 22 of 2018, the Government has amended LN 42 of 2017 which had originally introduced new tax rebates for pensioners in line with what was announced in the Budget Speech for 2017.  This new measure will ensure that pensioners whose pension income exceeds the tax-free bracket will have an increased amount of their pension income which will not be subject to income tax.

Pensioners that are over 61 years of age and who are in receipt of pension income will for the year 2018, be exempt from income tax on their pensions up to certain amounts, depending on the tax status of the individual.  This applies to all types of pensions including social security pensions, treasury pensions as well as other local and foreign pensions. 

Pensioners taxed at the single rates of tax will have an amount of €13200 of their pension income exempt from tax.  Pensioners taxed at the married rates of tax will have an amount of €13200 of their pension income exempt from tax.  Pensioners taxed at the parent rates of tax will have an amount of €13200 of their pension income exempt from tax.   Married couples in receipt of a pension will benefit from an additional exemption on their total income amounting to €1000.

These exemptions have been introduced by means of a tax rebate which naturally cannot give rise to any refunds of tax nor can be carried forward if not fully utilized.