Table of Contents Malta as a Tax Haven for Consultants: Why I Made the Leap Non-Dom Status Malta: The Key for International Consultants and Coaches Tax Planning Opportunities for Consulting Companies in Malta Invoicing as an International Service Provider: Practical Steps Malta Residency for Consultants: Requirements and Pitfalls Costs and Time Investment: What the Malta Move Really Costs My Experience: 18 Months as a Consultant in Malta Frequently Asked Questions Malta as a Tax Haven for Consultants: Why I Made the Leap When I moved my consulting business from Munich to Malta in 2023, my colleagues thought I’d gotten too much sun. “Malta? Where even is that? The answer is simple: right in the Mediterranean, right in the EU – and with a tax system that makes international consultants and coaches dream. After 18 months on the island, I can tell you: the decision was spot on. Not just because of 300 days of sun a year, but above all because of the tax advantages Malta offers specifically for consulting services. If you’re a coach, consultant, or trainer thinking about taking your business international, keep reading. Why Malta is Particularly Attractive for Consultants Malta has become a genuine hotspot for international service providers in recent years. That’s not only due to the Non-Dom status (Non-Domiciled Status – a tax category for foreigners living in Malta not of Maltese origin), but a whole series of factors: EU Membership: Full EU rights without restrictions English as an Official Language: No language barrier with authorities Strong Financial Services Sector: Well-established infrastructure for international business Double Taxation Agreements: Malta has over 70 DTAs worldwide Time Zone: CET – perfect for European and African clients The Difference Compared to Other Tax Havens Forget Dubai, Cyprus, or the Caribbean. Malta offers something most other jurisdictions don’t: full EU membership combined with genuine tax benefits. As an EU citizen, you can settle here without visa stress or complicated residence permits. The crucial point: Malta isn’t a classic offshore construction but a regular EU country with a legal, transparent tax system. That makes all the difference if you’re planning long term and don’t want to fear changing laws all the time. Who Malta is Worthwhile For Not every consultant should move to Malta. The system works best for: International consultants with clients in several countries Coaches with digital business models Trainers who work primarily online Experts with passive income (licenses, royalties) Consultants with annual revenues from 150,000 euros If most of your clients are in Germany and you make less than 100,000 euros, the cost of moving to Malta is probably higher than the tax savings. Non-Dom Status Malta: The Key for International Consultants and Coaches The Non-Dom status is at the heart of Malta’s tax strategy for international service providers. But beware: it’s often misunderstood. Non-Dom doesn’t mean “tax-free,” but “remittance-based taxation” – you only pay tax on income actually brought into Malta. What Does Non-Dom Status Actually Mean? As a Non-Dom resident in Malta (Non-Domiciled Resident – someone living in Malta who’s not of Maltese origin), you benefit from a special tax system: Maltese income: Normally taxed (15–35%) Foreign income: Only taxed if remitted to Malta Capital Gains: Not taxed if realized abroad Minimum Tax: 5,000 euros per year (since 2021) Sounds complicated? It is. So here’s an example from my own practice: I consult for companies in Germany, Austria, and Italy. My fees are paid to a German business account. From there, I transfer only the money I need for my living expenses to Malta — around 3,000 euros per month. Only these 36,000 euros are taxed in Malta, not my full consulting income of 180,000 euros. Requirements for Non-Dom Status Non-Dom status is granted automatically if you meet the following conditions: Maltese tax residency: At least 183 days per year in Malta Non-Maltese origin: You weren’t born in Malta No Maltese domicile: Malta isn’t your permanent center of life Tax authority registration: Formal application required The third point is the key: domicile is a complex legal concept. Simply put, you keep your original domicile (usually Germany) as long as you don’t formally declare Malta as your permanent home. The 5,000 Euro Minimum Tax: What You Need to Know Since 2021, every Non-Dom pays at least 5,000 euros of tax per year – regardless of how little money is brought into Malta. Sounds like a lot, but is fairly moderate internationally. Jurisdiction Minimum Tax Special Features Malta 5,000 EUR EU membership Cyprus 0 EUR More complex regulations Monaco 0 EUR High cost of living Switzerland (lump-sum) from 150,000 CHF Differs by canton Non-Dom Status Pitfalls The most common mistake: consultants think they can do all business through a Maltese company and pay just 5% corporate tax. That doesn’t work if the business is mainly managed from Malta. Other pitfalls: Substance requirements: Pure mailbox companies don’t work Remittance timing: When is money considered “transferred to Malta”? Offshore accounts: Complex rules for third-country accounts German CFC rules: These may trigger additional taxation My tip: Invest in professional advice before transferring your first euro. Maltese tax advisors know the pitfalls and help you avoid costly mistakes. Tax Planning Opportunities for Consulting Companies in Malta The real art isn’t just in Non-Dom status, but in intelligently combining different structuring opportunities. After 18 months of diving into Malta’s tax system, I can share: there are several routes – but not all are equally safe. Understanding the Maltese Full Imputation System Malta has a unique full imputation system. Simply put: corporate tax is later credited against income tax. For consultants, this creates some interesting opportunities: Corporate tax: 35% on company profits Tax refund: 6/7 of tax paid is refunded upon dividend distribution Effective rate: 5% on distributed profits Sounds too good to be true? It almost is—unless you pay attention. The system works only if certain criteria are met. Participation Exemption for Consulting Income This is where it gets exciting: Malta offers a participation exemption for specific foreign income. This means: profits from foreign participations or licensing can be completely tax-free. For consultants, this applies to: License fees: Sale of consulting methods or tools Royalties: Intellectual property income Participation profits: Dividends from foreign investments Capital gains: Selling company shares Practical Structuring Models Model 1: Pure Non-Dom Structure You work as a sole proprietor or using a foreign company. All income stays abroad, only living expenses are sent to Malta. Advantages: Simple, cost-effective, flexible Disadvantages: Limited planning flexibility, higher German tax risks Model 2: Maltese Company with 6/7 Refund You found a Maltese Ltd and get paid dividends. With the imputation system, your effective tax rate is 5%. Advantages: Low tax rate, EU-compliant structure Disadvantages: Substance requirements, higher costs Model 3: Hybrid Model with IP Holding Combination of Maltese consulting company and IP holding for license fees. Advantages: Optimal tax efficiency, scalability Disadvantages: Complex, expensive to set up What I Learned After 18 Months The reality is different from the brochures of tax advisors. Here’s my honest experience: You only get a 5% tax rate if all conditions are perfectly met. In reality, you’ll usually end up with 8–12% depending on structure and substance. Still excellent, but keep your expectations realistic. Substance Requirements: The Decisive Factor Malta requires genuine economic substance on the ground, i.e.: Office space: Not just a postal address, but an actual office Staff: At least one qualified person on site Business activity: Key decisions must be made in Malta Board meetings: Regular shareholder meetings in Malta These requirements cost money. Expect at least 15,000–20,000 euros annually for a substantial structure. Tax Risks and How to Protect Yourself The biggest risk is German CFC taxation. This applies if: You own more than 50% of the Maltese company The company mainly earns passive income The effective tax burden is below 25% Possible solutions: Treaty shopping: Use the German-Maltese double taxation agreement Substance proof: Demonstrate real business in Malta Structure optimization: Smart distribution of company shares Important: Get advice from both German AND Maltese tax consultants. The systems are complex and always changing. Invoicing as an International Service Provider: Practical Steps Here’s where theory meets practice: how do you invoice properly as a consultant in Malta? After countless chats with tax advisors, lawyers, and the Maltese tax office, I finally understood the system. Spoiler: it’s more complicated than you think, but doable. VAT in Malta: The Basics Malta’s standard VAT rate is 18%. For consultants, however, there are several exceptions and exemptions: B2B services EU: Reverse charge – 0% VAT B2B services outside the EU: Generally 0% VAT B2C services EU: Complicated – depends on several factors Local services Malta: 18% VAT The EU VAT Nightmare for Coaches If you’re a coach or trainer serving B2C clients in the EU, the VAT rules are a maze. Here are the most important pitfalls: Place of Supply for Consulting Services: B2B: Customer location (reverse charge) B2C: Service provider location (Malta) – but with exceptions Online courses: Electronic services – complex special rules Live trainings: Place of performance In practice: For pure B2B consulting, it’s still manageable. As soon as you offer online courses, webinars or coaching programs, things get tricky. MOSS vs One Stop Shop: What You Need to Know for 2025 Since 2021, the One Stop Shop (OSS) system replaces the former MOSS system. As a Maltese tax resident with EU-wide clients, this concerns you: Service type Threshold VAT B2B consulting Unlimited Reverse charge B2C local consulting Unlimited 18% Malta B2C online services EU Over €10,000 Local VAT rate B2C online services EU Under €10,000 18% Malta How I Actually Invoice Clients After 18 months, I’ve developed a system that works and is legally sound: For German B2B Clients: Invoice without Maltese VAT, with the note: Service subject to reverse charge. The recipient is liable for the VAT. The client pays German VAT direct to the German tax office. For Austrian B2B Clients: Same rule as Germany. Note: The client’s VAT ID must be listed on the invoice, or reverse charge doesn’t apply. For B2C Clients in Germany: Here it gets complicated. Pure consulting services remain subject to 18% Maltese VAT. Online courses may be liable for German VAT if turnover exceeds the €10,000 threshold. Software and Tools for Invoicing These tools have proven themselves in practice: Lexoffice: German software with Malta support Sevdesk: Good EU VAT features Xero: Internationally designed, Malta compatible Sage: Professional, but pricey Important: Make sure your software supports Maltese VAT requirements. Not all German tools can handle this. Special Features for Currencies As an international provider, you probably invoice in different currencies. Malta uses the euro, but your clients may pay in CHF, USD, or GBP. For tax purposes, use: ECB rate: Official reference rate Transaction date: Date of service or invoice Documentation: Exchange rates must be provable My tip: Choose software that automatically pulls and documents the ECB rate. This saves work and headaches with the tax office. Invoicing vs Receipt of Payment A common mistake: consultants think taxes are only due when the money arrives. Not true. Malta uses the accrual accounting principle: Service performed = tax due Regardless of payment receipt Exception: Doubtful debts This means: VAT is due before the client pays. Plan your liquidity reserves accordingly. Malta Residency for Consultants: Requirements and Pitfalls Getting Maltese tax residency is theoretically simple: spend 183 days per year on the island, done. In reality, though, things aren’t so easy. Based on my own experience and that of other consultants in Malta, there are pitfalls that can become expensive fast. The 183-Day Rule: It’s About More Than Just Being There Malta follows the classic residency test: anyone spending more than 183 days per calendar year in Malta is tax liable. Sounds simple, but the devil is in the details: Calendar year: January 1 to December 31, not 365 days from entry Days present: Even part-days count as full days Documentation: You need proof of your presence Travel interruptions: Short trips away don’t break residency My first year was a disaster for counting days. I thought three days in Germany for work wouldn’t count. Wrong – the Maltese tax office is very precise here. Alternative Residency Tests Malta also allows alternative routes to tax residency that can matter for consultants: Ordinary Residence Test: Long-term stay in Malta Also possible with less than 183 days Depends on personal and economic ties Center of Vital Interests: Main center of life Family, home, business activity Can apply even under 183 days Important: These alternatives can also make you tax liable unintentionally. If you buy property in Malta and run your business there, that may be enough – even with just 150 days. Avoiding Dual Tax Residency The biggest risk: being liable for tax in both Germany and Malta. It happens faster than you think, especially if you don’t plan the change properly. How to lose German residency: Deregister from the municipality: Officially move out Give up your home: Not just subletting Relocate your center of life: Family, friends, clubs End economic ties: Business, bank accounts, insurance How to secure Maltese residency: Register with Identity Malta: Apply for a residence card Rent or buy a home: Official residence Open bank accounts: Local economic ties Tax registration: Apply for a tax number The Traps of EU Free Movement As an EU citizen, you’re basically entitled to live freely in Malta. Still, there are bureaucratic hurdles: Residence card: Required for stays over 90 days Apply within the first 90 days Proof of sufficient means necessary Processing time: 3–6 months Required documents: Valid ID card or passport Rental contract or proof of ownership Health insurance proof Proof of sufficient means (approx. €14,500/year) Police clearance certificate (not older than 6 months) Practical Challenges What the brochures don’t mention: Malta is a small country with limited infrastructure. You really notice this with the residency process: Identity Malta offices: Appointments booked weeks or months in advance Online booking system often overloaded Processing times vary greatly Getting follow-up info is difficult My tip: Hire a local lawyer or advisor. They know the shortcuts and often have priority access to slots. Tax Registration Alongside residency applications, you must register with the Maltese tax authority: Tax compliance certificate: Needed for business activities Prerequisite for opening a bank account Must be renewed annually VAT registration: Obligatory from €35,000 turnover Voluntary registration possible Important for B2B business Trap: Returning to Germany If you ever want to return to Germany, things can get tax complicated: Exit taxation: Deemed disposal of company shares Lock-in period: 5 years Non-Dom status as protection DTA application: Potential double residency conflicts Plan your exit from the start. That’ll save a lot of money and nerves later. Costs and Time Investment: What the Malta Move Really Costs Now, the numbers: what does it really cost to move to Malta as a consultant? After 18 months on the island, I can give you a frank calculation. Spoiler: it’s more expensive than you think, but still cheaper than Switzerland. One-Off Setup Costs The first shock is the lawyer and advisor fees. Malta’s a common law system – you need professional help for everything: Item Cost Notes Tax advice (setup) 3,000–5,000€ Structuring Lawyer (residency) 1,500–2,500€ Residency request & documentation Company formation 1,200–2,000€ If Ltd needed Bank account opening 500–1,000€ Service fees Rental deposit 2,000–6,000€ 2–3 months’ rent Relocation/setup 5,000–15,000€ Depending on comfort level Total: €13,000–31,000 for a professional setup. Yes, that’s a lot. But compared to Swiss tax optimization or a Dubai setup, Malta is still moderate. Ongoing Yearly Costs Here are honest figures from my own accounts: Professional services: Tax consultant: 4,000–8,000€/year Bookkeeping: 2,400–4,800€/year Company secretary: 1,200–2,000€/year (for Ltd) Lawyer (ongoing): 1,000–3,000€/year Official fees: Minimum tax (Non-Dom): 5,000€/year Company fees: 245€/year (for Ltd) Residency renewal: 230€ every 5 years VAT returns: 0€ (if self-filed) Living costs: Rent (2-room): 1,200–2,500€/month Utilities: 200–400€/month Internet (fiber): 50–80€/month Groceries: 400–600€/month Car (optional): 300–600€/month The Hidden Costs These costs never show up in brochures: Malta Quality Surcharge: Anything you want to really work costs extra. Fast internet, reliable AC, an apartment free of damp – factor in a 30–50% premium on the standard market. Island Surcharge: Electronics: 20–30% more expensive than Germany Quality craftsmen: rare and pricey German products: luxury at luxury prices Flights: For meetings in Germany/Europe Time is Money: Dealing with authorities: Everything takes twice as long Handyman appointments: “Between 8am and 6pm” is the norm Internet outages: Happen more than you think Traffic: Congestion is absurd relative to the island size Break-Even Analysis for Consultants When is Malta financially worthwhile? Here’s my math: Example: Consultant, €200,000 annual revenue Scenario Germany Malta (Non-Dom) Savings Taxes 75,000€ 15,000€ 60,000€ Consulting costs 2,000€ 8,000€ -6,000€ Living cost diff. 0€ 6,000€ -6,000€ Net Savings 48,000€ So with €200,000 revenue you save about €48,000 per year. That clearly justifies the effort. At €100,000 revenue it’s different: Tax saving: ~€20,000 Extra Malta costs: ~€15,000 Net savings: ~€5,000 Here, the case is weak. Those €5,000 savings are not worth the stress and quality of life drawbacks. Time Commitment: The Underestimated Factor Malta eats up time. That’s a fact you need to budget for: First year: Setup phase: 2–3 months intensive Dealing with authorities: 1–2 days per month Tax advice: 2–3 hours per month Compliance: 5–10 hours per month Following years: Routine compliance: 2–4 hours per month Yearly tax return: 1–2 weeks Travel for German meetings: 10–20 days a year As a consultant, your time is your most valuable asset. Factor these hours into your Malta calculations. ROI Optimization: My Tips Get the most from your Malta investment by: Scaling your business: Malta only makes sense above certain revenues Investing in quality: Good advisors save money long term Automating processes: Software for bookkeeping and compliance Using location: Malta as a hub for EU/MENA business Planning the exit: Have a tax strategy for returning home My Experience: 18 Months as a Consultant in Malta Time for some straight talk: what’s it really like to live and work in Malta as an international consultant? After 18 months on the island, I’ve seen both the sunshine and the shadows. Here’s my honest experience – no sales pitch. The First Shock: Welcome to Reality My first day in Malta was a disaster. The apartment that looked perfect online turned out to be damp, dark, and with Stone Age internet. The landlord just shrugged: Welcome to Malta! And that sums it up. Malta isn’t Germany with sun. It’s a southern European country, for better and worse. Those expecting German efficiency and punctuality will be disappointed. The first three months were tough. Constant paperwork, communication issues despite English being an official language, and having to explain everything three times. Then the summer heat—I wasn’t ready for 35°C in the office with the AC broken again. Business Setup: Took Longer Than Planned My tax advisor promised: “Six weeks and it’s all sorted.” It took four months. Reality check: Bank account opening: 8 weeks instead of promised 2 Tried three different banks Submitted countless documents Personal appointments at every step Ended up at a German bank in Malta Tax number: 6 weeks instead of 1 Forms wrongly filled (not my fault) System “temporarily unavailable” Follow-ups took weeks VAT registration: 12 weeks instead of 4 Documents were “lost” Had to resubmit twice Phone support virtually non-existent Working in Malta: The Highs and Lows The upsides: Time zone: Perfect for EU clients, also covers North Africa/Middle East Internet: When it works, it’s fast (fiber up to 1000 Mbit) Language: English works everywhere EU access: No visa issues for client meetings Network: Many international businesspeople The downsides: Island isolation: Psychologically hard in winter Infrastructure failures: Power, internet, water – all have gone out Summer heat: July/August tough for concentrated work Traffic: Absurd relative to the island size Handymen: Getting an appointment is a gamble Tax Reality vs Theory I’m not achieving the promised 5% tax rate. In reality, I pay about 8–12%, depending on the year. That’s due to: Substance costs: Office, staff, meetings cost money Minimum tax: €5,000 plus local taxes VAT payments: Cash flow hit from upfront payments German CFC rules: Sometimes means extra taxation Still: 8–12% is fantastic compared to Germany’s 42% plus solidarity tax. Lifestyle: It’s Not All Sun and Beach What works: Weather: 300 days of sun is no exaggeration Safety: Malta is extremely safe Food: Mediterranean cuisine at high standard History: 7,000 years of culture on 316 km² Community: Lots of expats, international vibe What’s annoying: Size: After six months you know every corner Prices: Everything costs more than expected Traffic: Rush hour on a 27km long island Bureaucracy: Southern European “relaxation” Summer: Too hot, too touristy, too crowded Client Reactions: A Mixed Bag My German clients had mixed feelings about my Malta move: Positive reactions: Wow, Malta! That’s cool. Can the next meeting be on the beach? – Startup founder, Munich Skeptical reactions: Is this just for the taxes? Can you still properly look after us? – CFO, mid-sized company Neutral reactions: As long as quality’s right, we don’t care where you sit. – Board member, AG Important: Proactively explain the benefits of your Malta location for clients (time zone, EU access, international perspective). Personal Conclusion After 18 Months Would I do it again? Yes, but differently. What I’d do better: Longer test phase: 6-month trial stay before committing Better planning: More time for due diligence on housing/infrastructure Realistic expectations: Malta isn’t Germany with sun Backup plans: For internet failures, broken AC, etc. Social life: Invest more in local contacts My Advice for Other Consultants Malta works for you if: You earn at least €150,000 a year Your clients are internationally distributed You’re flexible and adaptable You can handle Southern European “relaxation” You’re not afraid of paperwork and costs Malta does NOT work for you if: You need German efficiency and punctuality Your business is tied to Germany You make less than €100,000 per year You don’t have at least €15,000 for setup costs You’re not willing to commit for at least 2–3 years Bottom line: Malta is a real alternative for international consultants, but not a silver bullet. The tax advantages are real, so are the challenges. Weigh your decision, plan carefully – and have realistic expectations. Frequently Asked Questions About Malta for Consultants and Coaches Can I simply move to Malta and work there as an EU citizen? Yes, as an EU citizen you enjoy free movement rights. But you must register with Identity Malta and apply for a residence card if you stay longer than 90 days. Processing takes 3–6 months. What’s the real tax burden for consultants in Malta? With Non-Dom status and optimal structure you’ll achieve a total tax burden of 8–12%. The advertised 5% is theoretically possible but challenging in practice. You pay a minimum tax of €5,000 per year. Do I need a Maltese company? No, you can work as a sole trader or via a foreign company. However, a Maltese Ltd offers tax advantages and more flexibility in structuring. How does VAT work on international consulting services? B2B services in the EU use reverse charge – you invoice without Maltese VAT. For B2C, things get more complex. Online services may fall under the One Stop Shop system. What does a full Malta setup cost? Expect €15,000–30,000 for a professional setup including advice, company formation, bank account, and first setup. Ongoing costs are €10,000–15,000/year. How long does the whole setup process take? Realistically, 4–6 months for a fully functional setup. Just opening a bank account often takes 6–10 weeks. Allow more time than promised. Can I still serve my German clients? Yes, but mind CFC rules (controlled foreign company). Pure consulting jobs are mostly fine, but passive income structures can get complicated. Is Malta just a tax trick or is it safe long-term? Malta is an EU member with a regular, transparent tax system. It’s not a tax trick but legal tax optimization. Rules are stable, but keep evolving as everywhere. What alternatives are there to Malta? Cyprus (more complex), Portugal (NHR program ending), Ireland (for large companies), Estonia (for tech businesses). For consultants, Malta remains one of the best EU options. Is Malta worth it for small turnover? Below €100,000 annual turnover, Malta usually isn’t worthwhile. Fixed costs (minimum tax, consulting, higher living costs) eat up any tax savings. From €150,000/year, it gets interesting.
