Malta ROPS

  • You can "cash-in" your pension in Malta; you are allowed flexible drawdown and early access at 55, similar to UK DC schemes
  • 30% tax-free lump sum or Pension Commencement Lump Sum (PCLS) is allowed at age 55
  • There is no tax on growth or death in Malta as long as you remain tax resident outside the UK
  • There is 0% income tax in Malta if a Double Taxation Agreement exists with your country of tax residence in retirement
  • There is up to 35% income tax payable in Malta if no DTA exists
  • If you live in Dubai, UAE or Qatar you pay 0% income tax on your retirement benefits; if you live in Portugal, you pay 0% on your retirement benefits for the first 10 years of residency
  • There are fees if you want to "cash-in" your pension after age 55, but it is possible, but we only recommend if you have multiple other sources of income that will support you during retirement
  • You can transfer to EUR, USD or leave in GBP
  • A Malta QROPS / ROPS is suitable for residents in the USA, Canada, Europe and Australia. You just pay income tax on retirement benefits in those countries, but no tax on growth or death
  • Malta is well regulated and politically stable

Malta ROPS / QROPS

Malta ROPS or Recognised Overseas Pension Schemes in Malta now allow British expats full pension freedom or access to full drawdown of their pension schemes after transfer and the member reaches 55 years of age. Malta is an EU country and has a long history of being a stable economy and financial centre for offshore companies in Europe. British expats living overseas can transfer their UK pensions to a Recognised Overseas Pension Scheme (ROPS) in Malta to escape the UK tax net on any existing UK private pensions or final salary pensions they hold.

A Malta ROPS can be useful for British expats retiring in Europe. It is the most popular ROPS for British expats retiring in Spain, Portugal, France, Italy, Bulgaria, the Netherlands, Germany, Switzerland and Turkey. A Malta ROPS can also be useful for Australia, Canada, Dubai, Qatar, Korea and Hong Kong (although HK has its own ROPS). In fact, since many SMSF’s and Australian Supers got delisted from being a QROPS, Malta has become a more popular place for British expats to park their pensions whilst waiting to retire in Australia, especially if those expats final retirement destination is Asia or Europe or they are young savers.

Reasons to Choose a Malta ROPS

  • Pensioners are unsure of their final retirement place, e.g. they live in Australia, but may retire in Asia or Europe
  • To access a 30% tax-free cash lump sum
  • Pensioners who want full pension flexibility and want to take larger lump sums down the line in a tax efficient manner after age 55
  • Pensioners who want to limit their tax liability
  • UK pension holders who want to transfer their pension pot into a foreign currency as they want to retire abroad and lock in current exchange rates
  • Tax liability will depend on where you are tax resident when you retire. Tax on pension income could be 0% or as high as 35% in Malta. You would also need to check local taxation. Please contact a ROPS adviser for more details
  • Clients can take benefits in the following ways:

1. 30% Tax free Lump Sum
2. Fund Annuity paid from the balance
3. Flexible access to the balance of the member’s fund

  • Flexible access may be taken in the form of lump sums over and above the Annuity level, and could be anything up to the value of the member’s fund. The flexible access payment is taxable in Malta as if it were a pension payment and will be relieved from tax where a tax treaty exists giving taxing rights to the member’s country of residence.
  • If the Flexible Withdrawal gives rise to the closure of an account, then there would be a termination fee, as well as an exit fee in most cases
  • Taking a lump sum from a pension scheme may cause unforeseen tax consequences in the future or may leave the client destitute in the future, so we would also need to obtain a suitability report to ensure that the client has taken suitable advice. This would be added to clients’ costs

Malta ROPS Fees and Cost Comparisons

Each pension trustee charges a different fee. They often have a “lite” arrangement to keep costs down, where the investment choice is more limited. Arrangements can become costly, if the ROPS were to invest directly in commercial property for example. Often fees are discounted for clients who have smaller pension pots under 100,000 GBP. Please email us for the latest Malta ROPS fees and comparisons as they change on a regular basis.

Malta Double Taxation Agreements

Here is a quick guide to Malta DTA’s. If you have a look, in the left hand column, select your “retirement destination”. The article number then refers to the article of the Double Taxation Treaty which covers the taxation of pensions. The right hand side refers to where the ROPS will likely be taxed. This is for reference purposes only. If you need an authoritative answer, you will need to seek advice from a tax attorney or barrister.

MALTA DTA’s

Country | Article | Country where taxable

Albania 21 Albania
Australia 18 Australia
Austria 18 Austria
Bahrain 20 Bahrain
Barbados 21 Shared Jurisdiction Malta
Belgium 21 Belgium
Bulgaria 8 Malta
Canada 18 Shared Jurisdiction Malta Tax capped at 15%
China 22 China
Croatia 21 Croatia
Cyprus 22 Cyprus
Czech Republic 21 Czech Republic
Denmark 18 Denmark
Egypt 18 Malta
Estonia 21 Shared Jurisdiction Malta
Finland 21 Finland
France 22 France
Georgia 21 Georgia
Germany 18 Germany
Greece 21 Greece
Guernsey 20 Guernsey
Hong Kong 17 Malta
Hungary 22 Hungary
Iceland 21 Iceland
India 22 India
Ireland 21 Ireland
Isle of Man 21 Isle of Man
Israel 21 Israel
Italy 21 Italy
Jersey 21 Jersey
Jordan 21 Shared Jurisdiction Malta
Korea 22 Korea
Kuwait 22 Kuwait (NR)
Latvia 22 Shared Jurisdiction Malta
Lebanon 21 Lebanon
Libya 23 Shared Jurisdiction Malta
Liechtenstein 20 Liechtenstein
Lithuania 22 Shared Jurisdiction Malta
Luxembourg 21 Luxembourg
Malaysia 23 Shared Jurisdiction Malta
Mexico 20 Shared Jurisdiction Malta
Montenegro 21 Montenegro
Morocco 22 Morocco
Netherlands 23 Netherlands
Norway 17 Shared Jurisdiction Malta
Oman In negotiation
Pakistan 21 Pakistan
Poland 22 Poland
Portugal 21 Portugal
Qatar 18 Qatar, but must qualify as resident i.e. must have permanent home, centre of vital interests or habitual abode in Qatar
Romania 23 Romania
Russia* 21 Shared jurisdiction, but better off in Gibraltar
San Marino 21 Malta
Saudi Arabia 22 Malta
Serbia 21 Serbia
Singapore 21 Shared Jurisdiction
Slovakia 21 Slovakia
Slovenia 22 Slovenia
South Africa 18 Shared Jurisdiction
Spain 21 Spain
Sweden 21 Sweden
Switzerland 21 Switzerland
Syria 21 Syria
Thailand In negotiation
Tunisia 21 Tunisia
Turkey 21 Turkey
United Arab Emirates 21 UAE
Ukraine 20 Ukraine
United States of America 17 United States of America
Uruguay 20 Uruguay

Please email us for more info on ROPS in Malta and to ask for the latest Malta ROPS fees.