Special Tax Status for Senior Family Office Employees - Malta’s New 15% Tax Regime for Senior Family-Office Professionals:

INTRODUCTION

Malta has recently made a big move to become a top destination for family offices and wealthy private clients. On 17 October 2025, it released Legal Notice 250 of 2025. Senior employees working in family offices, back offices, and treasury management now have a special tax status. Qualified individuals may elect to pay a flat 15% income tax rate on their employment income under this system. This attractive incentive links Malta’s tax system with its strategy for private wealth.

BACKGROUND & CONTEXT

Family offices are becoming increasingly important for managing wealth across generations. To host them successfully, jurisdictions need favorable regulations and the right skilled professionals. These senior staff members oversee complex functions, including treasury, risk, compliance, and investment. By offering a lower tax rate for these critical individuals, Malta aims to tackle one of the biggest challenges for family-office growth: attracting and keeping top talent.

OVERVIEW OF LEGAL NOTICE 250 OF 2025

Legal Notice 250, entitled Senior Employees of Family Offices, Back Offices and Treasury Management Operations Tax Rules, 2025, was published in the Government Gazette  on 17 October 2025. The rules will come into force on 1 January 2025 and apply for the assessment year 2026 and subsequent years. The notice is issued under Article 56(21) of Malta’s Income Tax Act,  which is the legal basis for the 15% flat tax election.

KEY PROVISIONS & ELIGIBILITY

•  Eligible Roles: The regime is focused on senior management and specialist roles. Examples of roles include Head of Back Office, Chief Executive Officer, Managing Director, Chief Risk Officer, Head of Compliance, Portfolio Manager, Head of Investments, Senior Trader, and Senior Structuring Professional.

• Eligible Entities: These include single-family offices, multi-family offices, and service providers such as back-office or treasury management entities, provided their operations are conducted in the context of family offices.

• Income Threshold: The employee needs to earn a minimum of €65,000 annually, excluding fringe benefits. This will increase by €10,000 every five years.

• Tax Rate & Cap: The flat tax rate of 15% applies to qualifying income of up to €7 million per year. Anything more than that is charged at the standard top rate of 35%.

• Qualifications / Experience: The individuals should have professional qualifications or at least five years of relevant experience.

• Residency & Other Conditions: The employee should reside in Malta and maintain a health and safety standards-compliant accommodation. Employees should have stable and regular means of support to keep themselves and their families independent of Maltese social assistance. They should hold private health insurance covering all the usual risks. They shall not be domiciled in Malta. A valid travel document is a must.

• Anti-Abuse / Compliance: The regime does contain certain safeguards. First, the competent authority, along with the Commissioner for Tax, must confirm that a genuine relationship exists. They can deny requests if misuse or artificial structures are obvious.

APPLICATION, DURATION & COMPLIANCE

•  Application window: Applications are open between 1 January 2025 to 31 December 2034.

• Determination: There shall be formal determination by the competent authority, with agreement from the Commissioner.

• Duration of Benefit: When granted, the 15% rate is applicable from the beginning of the year, in which the determination was made for five years. Beneficiaries are allowed to renew it twice for a further five-year period each, until reaching a maximum of 15 years, provided that in the interim period they maintain their eligibility. Gains accruing after 31 December 2040 are not covered under the scheme.

STRATEGIC IMPLICATIONS

•   For Family Offices / Employers:  This provides a very good incentive for attracting high-caliber employees to Malta. The family offices will thus be able to offer highly competitive remuneration packages but at a considerably lower effective tax rate. This may prove a more attractive option than other financial centers, particularly in C-suite and senior roles.

• For Senior Professionals / Employees: For executives considering relocation to Malta, this will substantially reduce the tax burden. A flat rate, steady at 15%, with very few deductions or credits, provides predictability. Besides, it facilitates long-term planning, especially with a possible 15-year timeframe.

• Financial Ecosystem for Malta: By attracting senior professionals to Malta or retaining them in the country, Malta develops its value proposition as a center for private wealth structures and talent in finance, risk, compliance, and treasury. This would create cluster effects, enhance in-house capabilities, and finally have positive spillovers in other financial fields.

RISKS, CAVEATS & CONSIDERATIONS

• Anti-Abuse Risk: The competent authority will scrutinize the applications to verify that the positions do, in fact, exist and are not created artificially to attain access to the tax benefit.

• First Employment Condition: One requirement is that an individual’s first employment in Malta under a qualifying contract must begin after 1 January 2025, and they must not have earned Maltese income before this date under certain categories.

•  No Reliefs: This 15% rate does not have any option to claim deductions, credits, allowances, or reliefs. As such, although low, the rate is applied to gross employment income.

• Regulatory Risk / Changes: Like any tax incentive, future governments might alter the rules. Beneficiaries must also remain compliant every year.

Malta’s new 15% special tax regime for senior family-office professionals offers significant benefits, but successful adoption requires a clear understanding and strategic preparation. With strict eligibility rules, tight deadlines, and extensive documentation, navigating the regime can be complicated without expert support.

At Water & Shark, we help clients with everything from structuring and application planning to governance, compliance, and ongoing administration. Guided by our 5Ps framework - Preparation, Privacy, Protection, Preservation, and Prosperity, we ensure you secure current tax benefits while supporting long-term continuity and wealth safety. With professional guidance, accessing Malta’s incentive becomes easier, compliant, and more rewarding.

FAQs

Q1. Who can benefit from Malta’s 15% tax regime for family office employees?

Senior professionals employed by qualifying family offices, back offices, or treasury entities who meet income, experience, and residency criteria.

Q2. Is the 15% tax rate applied to all income?

No. The 15% flat rate applies to qualifying employment income up to €7 million per year. Income above this is taxed at 35%.

Q3. Can the regime be renewed after the initial period?

Yes. The benefit applies for five years and can be renewed twice, subject to continued eligibility, for a maximum of 15 years.

Q4. Are deductions or tax credits allowed under this regime?

No. The 15% rate applies to gross qualifying income without deductions, allowances, or credits.

Q5. What risks could lead to denial or withdrawal of the benefit?

Artificial arrangements, lack of substance, failure to meet residency or compliance conditions, or regulatory changes could result in denial or revocation.