Social Security Contributions
Under normal rules, so as to be exempt from paying social security contributions in Malta, an expatriate has to provide official evidence to the Maltese authorities that he or she is paying national contributions elsewhere. In the case of the film industry, an exemption form payment of social security contributions can be obtained on the basis that the expatriate employees would only be present in Malta for a short period of time and in connection with a film production. A film company can make a block application listing the respective expatriates and their details. The Social Security Department subsequently issues one ‘en bloc’ exemption from Maltese social security contributions covering the said employees.
The income of any individual employed with a film production company, or employed with a company which offers its services to such film production company, shall be chargeable to tax at the rate of 15% of the gross payment receivable in respect of such employment exercised in Malta, and no set-off or refund shall be granted to any person in respect of the tax so charged, provided that:
a] the said individual is neither ordinarily resident nor domiciled in Malta, and
b] the said individual’s period of employment in Malta does not exceed 183 days, and
c] where the said individual is an actor, front of camera performer or film director the applicable tax rate shall be 10% of the gross payment receivable
The tax chargeable in terms of the immediately preceding paragraph shall constitute a final tax covering the Maltese tax liability of the said individual.
Where payment for the particular services through employment is made by a film production company, the obligation to withhold and pay the tax contemplated in the first paragraph of this provision shall be imposed on such film production company, even in cases where the film production company is effecting payment for such services to a service company.
The application of the final tax rate as aforesaid is subject to the following conditions being satisfied:
a] the film production company is a ‘qualifying company’ engaged in a ‘qualifying production’ as defined in the Financial Incentives for the Audio-Visual Industry Regulations 2008, issued under the Malta Film Commission Act [Cap 478], and
b] the Malta Film Commission submits confirmation to the Office of the Commissioner for Revenue of each qualifying company engaged in a qualifying production