Table of Contents Social Security Malta: The Basics for the Self-Employed Health Insurance Malta: Mandatory or Optional for the Self-Employed? Pension Insurance Malta: What International Self-Employed Professionals Need to Know Social Security Contributions Malta: Costs and Calculations EU Citizens vs. Third Country Nationals: Social Security Differences Step-by-Step: Registering with Social Security Malta Common Mistakes and How to Avoid Them Frequently Asked Questions When I moved to Malta two years ago, I naively thought: “EU country, no problem—the social security system will work just like in Germany.” Spoiler alert: It doesn’t. After three appointments at Jobsplus, two confusing forms in Maltese, and an afternoon in the waiting line, I now know: Maltas social security system is just like the island itself—small, but complex. Especially as a self-employed person, you are faced with decisions that have a long-term impact on your finances. Health insurance: mandatory or optional? Pension contributions: pay into Malta’s system or prefer your home country? And what actually happens if you move between EU countries? In this article, I’ll explain exactly what you need to know about social security in Malta. No bureaucratic language—just practical insights from someone who’s already navigated the paperwork. You’ll learn not only what’s possible in theory, but also where the real-world pitfalls are. Social Security Malta: The Basics for the Self-Employed Malta’s social security system is based on three pillars you must understand as an international self-employed professional. First, the state health insurance (part of the Department of Social Security), second, the state pension insurance, and third, optional supplementary insurances. While it sounds complicated, there’s actually a simple logic: Malta wants every resident to have basic protection, but as a self-employed person, you have more choices than employees. The Maltese Department of Social Security Your first point of contact is the Department of Social Security—DSS for short. Here’s where everything comes together that in Germany would be handled by several organizations. The authority is responsible for health insurance, pensions, unemployment benefits, and social benefits. As a self-employed person, you apply for your Social Security Number here—nothing works in Malta without it. Important: Malta distinguishes between employed persons and self-employed persons. This categorization determines your rights and obligations. If you switch between employment statuses, you must report it immediately—otherwise, it can get expensive. Social Security Obligation: Who Must, Who Can? This gets interesting: As an international self-employed professional in Malta, you are generally liable for social security if you relocate your center of life to the island. This means: Health insurance: Access to the Maltese health system via social security contributions or private insurance Pension insurance: Contributions to the Maltese pension system (with exceptions for EU citizens) Work accident insurance: Automatically included if you pay social security contributions But—and this is the good thing about Malta—you have much more flexibility than employees. For example, you can choose to pay higher contributions voluntarily or opt out of certain benefits if you are insured elsewhere. EU Social Security Agreement: Your Lifeline If you are an EU citizen, the EU Social Security Agreement applies to you. This means: Your entitlements acquired in Germany, Austria, or any other EU country are not lost—they are counted when calculating your Maltese pension. The process runs through the Portable Document A1 (formerly E101), which you can request from your home country. What does this mean for you? You don’t have to start from scratch and can build on your existing entitlements. However—and this is the catch—you must actively decide in which country you pay your contributions. There is no automatic process. Health Insurance Malta: Mandatory or Optional for the Self-Employed? To me, health insurance in Malta is the perfect example of how pragmatically the island handles EU law. Theoretically, as a self-employed person, you are required to join the Maltese system. In practice, Malta also accepts EU health insurances—as long as you can prove you have comprehensive coverage. Understanding the Maltese Health System Malta’s state health insurance operates on a benefits-in-kind principle: You pay social security contributions and receive free treatment in public health facilities. The quality is—let’s be honest—mixed. The Mater Dei Hospital in Msida is modern and well-equipped, but waiting times can be frustratingly long. Private supplementary insurance is very common in Malta. The cost is moderate: A comprehensive private health policy costs between 800 and 2,500 euros per year, depending on age and coverage. Options for International Self-Employed Professionals You essentially have three options: Maltese social insurance + private supplemental insurance: The standard for long-term residents Keep German/EU health insurance: Possible if you can prove coverage is valid in Malta International private health insurance: The flexible but more expensive option Maltese Health Insurance: Benefits and Limits What do you get for your social security contributions? The basic protection is solid: Service State-covered Wait time/Limitations GP visits ✓ Free Often 2-3 weeks in advance Emergency treatment ✓ Free Long waits for non-critical cases Specialists ✓ With referral Wait times 1-6 months Medications Partially (prescription charge) Not all medications available Dental treatment Only emergencies Private co-payment usually required German Health Insurance in Malta: What Works? Many Germans wonder: Can I simply keep my German health insurance? The answer is complicated. Statutory insured persons lose their entitlement when they move to Malta and become self-employed there. Privately insured can often keep their insurance, but must check if coverage applies in Malta. My tip: Contact your German insurer before moving. Many offer special plans for residents abroad. These are often cheaper than a completely new policy in Malta. Private Health Insurance Malta: The Popular Alternative Most international self-employed people I know choose a combination: Minimal Maltese social insurance plus comprehensive private health insurance. Why? Private providers in Malta are competitive and often offer better service than the public system. Popular providers include Mapfre Middlesea, Elmo Insurance, and GasanMamo. A private health plan for a 35-year-old self-employed person costs about 1,200–1,800 euros per year for comprehensive coverage including overseas travel. What does this mean for you? Plan on at least 1,500–2,000 euros per year for health insurance if you want solid coverage in Malta. That’s less than in Germany or Switzerland, but more than many other EU countries. Pension Insurance Malta: What International Self-Employed Professionals Need to Know Malta’s EU pragmatism is especially clear in pension insurance. The Maltese pension system is much more generous than its reputation suggests, but you have to understand the rules. As an international self-employed person, you have choices that not everyone knows about—and they can make a difference of thousands of euros in pension income. The Maltese Three-Pillar Pension System Malta fundamentally reformed its pension system in 2006, introducing a three-pillar system: First pillar: State basic pension—for anyone who has paid in for at least 10 years Second pillar: Earnings-based pension—depends on your contributions Third pillar: Private or occupational pension schemes What makes the system attractive for the self-employed? You can voluntarily pay higher contributions and thus increase your future pension. Plus, contribution rates are lower than in Germany or Austria. Pension Insurance Contributions Malta: What Do You Really Pay? As a self-employed person in Malta, you pay a total social contribution of 15% on your income. Most of this goes to pension insurance. Here are the calculation bases (as of 2024, always check latest DSS info): Annual income Contribution rate Maximum contribution per year Up to €25,000 15% €3,750 €25,001 – €60,000 15% €9,000 Over €60,000 15% (capped) €9,000 Interesting: There is a contribution ceiling of around 60,000 euros. If you earn more, you still only pay a maximum of 9,000 euros social contributions per year. This makes Malta attractive for high-earning self-employed people. EU Pension Rights: How Does Aggregation Work? This is where things get really interesting. Thanks to EU Regulation 883/2004, your pension entitlements from different EU countries are added together. In practice: Your German pension contributions remain untouched Your Maltese contributions are added on At retirement, each country pays you a share Example: You worked 20 years in Germany and 10 in Malta. Germany pays you two-thirds of the pension based on your German contributions, Malta one-third based on Maltese contributions. Both countries, however, consider your total 30 years of EU work time. Voluntary Top-Up Insurance: Is It Worth It? Malta allows self-employed people to voluntarily pay higher contributions. You can contribute up to 50% extra and receive correspondingly higher pension rights. This is especially interesting if you plan to stay in Malta long term. Calculation example: Instead of paying 3,000 euros, you pay 4,500 euros a year voluntarily—your future Maltese pension increases accordingly. Over a planned retirement of 20 years, that could mean an extra 30,000–50,000 euros. Retirement Age Malta vs. Germany The regular retirement age is 65. Germany is raising its retirement age to 67. Retiring two years earlier—in average cases—means a substantial difference. Malta is also more generous with early retirement. From age 61, you can retire with deductions if you have at least 35 years of contributions. The deductions are milder than in Germany. What does this mean for you? If you still have 15–20 years until retirement, switching to Malta can make pension sense. Always have a specialist tax advisor run the calculations for you. Social Security Contributions Malta: Costs and Calculations Let’s get down to the concrete figures—the part that really hurts if you haven’t planned ahead. When I received my first Maltese social security bill, I was surprised: Malta is cheaper than Germany, but more expensive than many digital nomad hotspots. The good news: You’ll know exactly what’s coming your way in advance. Contribution Rates Malta: The Overview As a self-employed person, you pay a flat rate of 15% on your net income in Malta. This covers all social security services: health, pension, unemployment insurance, and accident cover. Simpler than the German system, which has different rates for each type of insurance. The 15% is split as follows: Pension insurance: approx. 10% Health insurance: approx. 3% Other benefits (unemployment, accident insurance): approx. 2% Calculation Basis: What Counts as Income Subject to Social Security? This is where it gets tricky. Malta calculates your social security contributions not on gross, but on your net income after deducting business expenses. That’s good, but also has its pitfalls: Recognised business expenses: Office costs (including proportional home office) Hardware and software Travel expenses Training Legal and tax consulting Non-recognised expenses: Private health insurance Private pension Living costs Over-the-top “business meals” Practical Calculation Examples Let’s run the numbers with three typical self-employed profiles: Scenario Gross income Business expenses Net income Social security (15%) Freelancer €40,000 €8,000 €32,000 €4,800 Consultant €80,000 €15,000 €65,000 €9,000 (capped) Online business €120,000 €30,000 €90,000 €9,000 (capped) Important: The contribution ceiling is around 60,000 euros net income. Above this, you pay a maximum of 9,000 euros social security per year—regardless of how much you earn. Minimum Contributions and Special Cases Malta also has minimum contributions you must pay, even if your income is low. As a self-employed person, you must pay at least as if you earned minimum wage. That’s currently about 1,200 euros in social security per year. Interesting for seasonal businesses: You can spread your contributions throughout the year, but the minimum has to be met. If you have no income in a year, you can request a contribution pause—but you lose pension rights for the period. Comparison with Other EU Countries How does Malta stack up in Europe? Here’s a breakdown of total deductions for the self-employed: Country Social security Income tax (top bracket) Total burden Malta 15% 35% 50% Germany ~25% 42% 67% Austria ~28% 55% 83% Portugal 21.4% 48% 69.4% So, for social security, Malta is cheaper than the DACH region. Combined with tax advantages, this can mean significant savings for the self-employed. Payment and Deadlines You pay your social security contributions quarterly—always by the 15th of the month after each quarter ends. So by April 15, July 15, October 15, and January 15. Late payment incurs interest and may lead to exclusion from social security. My tip: Set up a standing order. DSS won’t automatically remind you of due contributions, and fixing things later gets complicated and expensive. What does this mean for you? Plan about 15–20% of your net income for social security. That’s less than in Germany, but still a significant cost to include in your calculation. EU Citizens vs. Third Country Nationals: Social Security Differences This is where Malta’s EU membership shows its practical side. As an EU citizen, you have rights and options that third country nationals can only dream of. But—it’s important—you also have obligations you shouldn’t ignore. Here’s an overview of the key differences to guide your planning. EU Citizens: Freedom of Movement with Responsibility As an EU citizen, you benefit from Regulation 883/2004. Specifically: Immediate access to Maltese social security with no waiting periods Transfer of your rights from other EU countries System coordination—no double insurance required Equal treatment with Maltese nationals But beware: EU law does not automatically mean EU convenience. You need to actively decide where you want to be insured. This doesn’t happen automatically and can be complicated if you have activities in multiple EU countries. The A1 Form: Your Most Important Document If you move to Malta as an EU citizen but still work for clients in Germany, you need the A1 form (formerly E101). This document certifies where you are covered by social security. Without the A1 form, German clients could theoretically classify you as a pseudo self-employed worker. You apply for the A1 form at the competent authority in your home country. In Germany, this is Deutsche Rentenversicherung or your health insurer. The application takes 2–6 weeks, so plan ahead. Third Country Nationals: More Hurdles, Less Flexibility As a third country national (non-EU citizen), your situation is more complex. You generally have the same rights in Maltese social security, but: No automatic recognition of entitlements from your home country Potential double coverage in Malta and at home Waiting periods may apply for certain benefits Proof of residency required for entitlements Especially problematic: Many third countries have no social security agreement with Malta. That means your home-country pension rights are not credited. Double Taxation Agreements vs. Social Security Agreements A common mistake: Double taxation treaties and social security agreements are not the same. Malta has tax agreements with many countries, but only a few social security agreements. Countries with a social security agreement: All EU countries (automatic) Switzerland United Kingdom (post-Brexit special rules) Canada Australia No social security agreement: USA Singapore Dubai/UAE Most Asian and African countries Practical Implications for Your Planning What does all this mean for you? As an EU citizen: You can move freely between EU countries Your pension rights are preserved But you must actively coordinate where you are insured For temporary stays, you can often stay insured in your home country As a third country national: You should plan Malta as a long-term solution Returning home can mean loss of pension rights You’ll often need international health insurance as a backup The decision for Malta should be well considered Brexit Special Case: UK Citizens in Malta British nationals are a special case since Brexit. Those who lived in Malta before December 31, 2020, largely retain their EU rights. New British residents are treated as third country nationals, with some transitional rules. If you’re British and want to move to Malta: Check with the Department of Social Security for current rules. They are still changing regularly. What does this mean for you? Your nationality largely determines your options in Malta. As an EU citizen, you have significantly more flexibility, but also more coordination work. As a third country national, you must plan more strategically and see Malta as a long-term commitment. Step-by-Step: Registering with Social Security Malta Now let’s get practical. I’ll walk you through the entire process—from preparing in your home country to your first contribution notice in Malta. If you follow this guide, you’ll save at least two additional appointments and several weeks of waiting time. Preparation in Your Home Country The most important tip: Prepare everything before moving to Malta. Some documents are hard or impossible to get from Malta. You will need these documents: Certified translation of your birth certificate into English European Health Insurance Card (for EU citizens) A1 form from your previous social security agency Proof of previous social security periods (in Germany: pension insurance record) Apostille for all German documents you want to use in Malta You get the apostille in Germany from your state justice ministry or regional authority. This takes 1–4 weeks and costs about 25 euros per document. Getting it afterward in Malta is much more complicated. Step 1: Apply for the Maltese ID Card Nothing works without the Maltese ID card (Identity Malta ID). This is your first stop when you arrive in Malta. Where: Identity Malta Office in Gwardamangia or Gozo Opening hours: Monday–Friday 8:00–15:00, Saturday 8:00–12:00 Appointment: Online at identitymalta.com or on site Processing time: 2–3 weeks Required documents: Original passport Biometric passport photo Proof of Maltese address (rental contract or utility bill) Fee: 25 euros Insider tip: Book the appointment online at least a week in advance. Walk-ins often mean several hours of waiting. Step 2: Register with the Department of Social Security With the ID card, go to the Department of Social Security. The main office is Evans Building, Merchant Street, Valletta. Opening hours: Monday–Friday 8:00–16:00 Appointment: Not strictly required, but recommended Processing time: 1–2 hours on site, 2–4 weeks processing Bring these documents: Maltese ID card Passport Proof of self-employment (business registration, trade register excerpt) Form SSA7 (Self-Employed Declaration)—fill out in advance or on site Proof of Maltese address A1 form (if available) Step 3: Filling Out the SSA7 Form Correctly The SSA7 form is crucial for your contribution calculation. Here you enter your expected annual income and activity. Important points: Estimate income realistically: Too low = back payment, too high = upfront payment, no interest Describe activity precisely: Affects possible supplementary insurances Start date: Date of your first invoice in Malta, not the moving date Submit the completed form in person. You get a receipt—keep it in case of follow-up questions. Step 4: Receive Social Security Number After 2–4 weeks, you’ll receive your Maltese social security number by post. This 8-digit number is used for all further paperwork, tax returns, and doctor visits. With the social security number, you’ll also get your first contribution notice—detailing your quarterly payments. Step 5: Set Up Payment Methods Malta accepts social security payments by bank transfer, standing order, or in cash. I highly recommend the standing order—this avoids late fees and interest charges. DSS bank details: Bank of Valletta IBAN: MT84VALL22013000000040027035721 BIC: VALLMTMT Reference: Your Social Security Number Step 6: Apply for Health Insurance Card With your social security number, you can apply for your Maltese health insurance card. Do this at the same DSS office or online. The card arrives 1–2 weeks later by post and entitles you to free treatment at government health facilities. Timeline and Costs Overview Step Time required Cost Required for next step Apply for ID card 2–3 weeks €25 Social security registration DSS registration 2–4 weeks Free Health insurance card Health insurance card 1–2 weeks Free Doctor visits In total, allow 6–8 weeks to complete everything. During this time, you are covered for emergencies by your European Health Insurance Card. What does this mean for you? Plan the registration process as your first major step after moving. With proper preparation, it’s less complicated than expected—but without it, you’ll be standing in front of closed doors more than once. Common Mistakes and How to Avoid Them After two years in Malta and countless conversations with other self-employed people, I know the typical pitfalls. Some just fray your nerves, others really cost you. Most, however, can be avoided if you know what to watch for. Here are the seven most common mistakes—and how to steer clear of them. Mistake 1: Registering for Social Security Too Late The classic beginner mistake: You move to Malta, start work immediately, but only register for social security months later. That can get expensive. The rule: You must register within 30 days after starting self-employment. If you don’t, expect fines and back payments with interest. How to avoid it: Register as soon as you get your Maltese ID card at DSS—even if you don’t have clients yet. You can backdate your activity if needed. Example: Marco, an Italian web designer, registered after six months. Result: 1,200 euros back payment plus 8% interest per year. He could have avoided it. Mistake 2: Choosing the Wrong Country for EU Social Insurance As an EU citizen, you need to decide where you want to be socially insured. Many make this decision unwittingly or not at all. Rule of thumb: You are insured where you have your center of life and mainly work. But there are exceptions for temporary stays and cross-border work. Problematic if you: Live in Malta but mainly do German client work Commute between Malta and Germany Are only in Malta temporarily (less than a year) How to avoid it: Apply for the A1 form with your German social insurance before you move. This clarifies where you’re covered and prevents double insurance or gaps. Mistake 3: Poor Documentation of Business Expenses Malta calculates your social security on net income after business expenses. Many keep sloppy records or none at all. Typical documentation mistakes: Receipts not in English or Maltese Mixing private and business expenses No clear allocation for home office costs Lack of justification for unusual expenses How to do it right: Keep good accounts from the start. Collect all receipts, translate foreign invoices into English, and document business use. Even a simple Excel spreadsheet is enough. Mistake 4: Missing the Contribution Ceiling Many don’t know Malta has a contribution ceiling. From about 60,000 euros net income, you pay only 9,000 euros per year—no matter how much you earn above that. The mistake: High-earning self-employed people calculate with 15% of total income and misjudge their cash flow. How to benefit: If you are over the contribution ceiling, your relative burden drops dramatically. With 100,000 euros net income, you pay only 9% instead of 15%. Mistake 5: Underestimating Health Coverage Many international self-employed people assume the Maltese social system covers all health needs. That’s only partly true. What’s often overlooked: Long wait times for specialists (several months) Limited availability of certain medications Dental care only covered for emergencies No treatment in private clinics The solution: Budget in advance for supplementary private insurance. 1,200–1,800 euros per year for a good private health plan is a sensible investment. Mistake 6: Ignoring Payment Deadlines Malta is generous in many ways, but not about late social contribution payments. The quarterly deadlines are strict. The deadlines: Q1 (Jan–Mar): pay by April 15 Q2 (Apr–Jun): pay by July 15 Q3 (Jul–Sep): pay by October 15 Q4 (Oct–Dec): pay by January 15 If late: 8% interest per year plus collection fees. After several months, you risk being excluded from social security. How to avoid it: Set up a standing order as soon as you get your first contribution notice. Rates rarely change unexpectedly. Mistake 7: No Reserve for Back Payments At year-end, it’s time to settle up. If you earned more than estimated, you must pay the difference. Many are surprised by this. Typical case: You estimate 30,000 euros, pay 4,500 in contributions. You actually make 45,000. Back payment: 2,250 euros at once. How to plan sensibly: Put aside 15–20% of your actual monthly income for social security. Year-end, you’ll be safe or even get a refund. What does this mean for you? Most mistakes come from lack of preparation or ignorance of Malta’s specifics. With the right planning and a little discipline, you can avoid all of them. Believe me: It’s much more relaxing to get it right from the start than to make expensive corrections later on. Frequently Asked Questions Do I have to join Maltese social security immediately as an EU citizen? No, not automatically. As an EU citizen, you can temporarily remain covered at home if you apply for the A1 form—this is only for temporary stays or specific cross-border activities. If you move your main residence to Malta, you normally must switch to the Maltese system. Can I keep my German private health insurance in Malta? It depends on your policy. Many German private health insurers offer worldwide coverage or special EU plans. However, you must check if the coverage meets Maltese requirements and whether you still have to pay Maltese social security contributions. How high are the social security contributions for the self-employed in Malta? You pay 15% of your net income after deducting business expenses. For a net of 40,000 euros, that’s 6,000 euros per year. From about 60,000 euros net, the cap applies—you pay a maximum of 9,000 euros per year. What happens to my German pension entitlements? Your German pension rights remain fully intact. Under the EU social security agreement, your German and Maltese periods are aggregated. You’ll receive a share of pension from both countries—Germany pays for the German part, Malta for the Maltese. Do I have to pay social security if all my clients are outside Malta? Yes, what matters is your residence and where you do your work, not where your clients are. If you live in Malta and work from there, you’re subject to social security—even if all your clients are in Germany, the USA, or elsewhere. How long can I live in Malta without being subject to social security? As a tourist, you can spend 90 days per six months in Malta. Once you register as a resident or stay longer, you must join social security. As a self-employed person, you must register within 30 days of starting activity. How much does a private health insurance in Malta cost on top? A comprehensive private policy costs between 800 and 2,500 euros per year depending on age and coverage. For a 35-year-old self-employed person with good coverage, budget 1,200–1,800 euros. That’s less than in Germany or Switzerland. Can I be exempted from compulsory Maltese social security? Generally, no. If you live and work independently in Malta, you are subject to social security. Exceptions exist only in very special cases, like diplomats or people covered by specific international agreements. For ordinary self-employed, there is no exemption. What happens if I leave Malta again? As an EU citizen, you take your Maltese pension rights with you. You can also stay insured in Malta if you move to another EU country—but usually it’s not worth it. When moving to a non-EU country, your Maltese social security rights may be frozen. How does Malta credit periods abroad for pension purposes? Malta adds all your EU contribution periods together. If you worked 20 years in Germany and 15 in Malta, Malta counts all 35 years for minimum eligibility. The pension amount is calculated only on your Maltese contributions. Germany pays separately based on your German periods.

Deja una respuesta

Tu dirección de correo electrónico no será publicada. Los campos obligatorios están marcados con *