How is rental income from a Malta property actually taxed?

Rental income from Maltese property is subject to tax under the Income Tax Act, Chapter 123 of the Laws of Malta, and landlords generally have a choice regarding how this income is taxed, since Malta provides for an optional final withholding tax rate specifically applicable to rental income from residential property, which is often a genuinely simpler and, depending on your circumstances, potentially more favourable option compared to declaring the rental income as part of your general taxable income at your normal progressive tax rates, though which option is actually more beneficial for you specifically depends on your overall income situation and the specific figures involved. If you opt for having the rental income taxed under the general progressive rates rather than the final withholding tax option, you would generally be entitled to deduct legitimate expenses actually incurred wholly and exclusively in generating that rental income, such as certain maintenance costs, ground rent if applicable to the property, and other genuinely related expenses, though the specific deductible categories and any limitations need to be correctly applied rather than assumed, whereas the final withholding tax option, by contrast, generally does not allow separate expense deductions given its simplified flat-rate structure. Given that choosing between these two rental income tax treatment options can genuinely make a meaningful difference to your actual tax liability depending on your specific circumstances and expense levels, it would be worth consulting an accountant to properly calculate which option would actually be more favourable for your specific situation before filing.