Singapore and Malta signed a first-time incometax treaty on 21 March 2006. Further details of the treaty will be reported subsequently.
The maximum rates of withholding tax are:
| - | 10% on interest in general, and 7% if received by a bank, subject to an exception for interest paid to the government (as defined); and |
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| - | 10% on royalties |
Deviations from the OECD Model include that:
| - | a permanent establishment includes a building site, a construction or installation or assembly project, or connected supervisory activities, that last more than 9 months, and the furnishing of services, including consultancy services, for a total of more than 6 months in any 12-month period; and |
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| - | the non-discrimination article does not prevent a state from restricting domestic personal allowances, reliefs and tax reductions to its residents or nationals, tax incentives to its nationals, or the imposition of withholding tax (in the case of payments from Singapore). |
Both states generally provide for the credit method to avoid double taxation. Tax sparing provisions apply in both states for the first 10 years after the treaty becomes effective, and thereafter for a further 5 years.