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Malta ratifies tax treaty with Monaco

Malta has ratified the Malta - Monaco Income Tax Treaty (2018), by way of Legal Notice 70 of 2019, as published in Official Gazette No. 20,169 of 12 April 2019. The income tax treaty was signed on 1st October 2018, by officials from Malta and the Principality of Monaco, and it is the first of its kind between the two countries.

According to the treaty (which follows the OECD model convention) the residence state is entitled full jurisdiction to tax income derived from dividends, interest and royalties according to the domestic tax legislation, with the source state having no rights to levy any withholding taxes on such income.

The income source state will also claim taxing rights with respect to capital gains on immovable property and capital gains on shares whose value is derived as to more than 50% from immovable property situated in that state.