Ireland vs Malta โ 12.5% vs 5% Effective
Malta's effective 5% CT rate (via the 6/7 shareholder refund) is lower than Ireland's 12.5%. But Malta requires waiting for refunds (historically 12โ24 months) and is primarily strong for gaming, f...
The effective rate difference
| Factor | Ireland | Malta |
|---|---|---|
| Headline CT rate | 12.5% (trading) | 35% |
| Effective rate | 12.5% | ~5% (after 6/7 refund) |
| Refund mechanism | N/A | Filed after dividend distribution |
| Refund timing | N/A | Historically 12โ24 months |
| R&D credit | 25% refundable | Varies; less generous |
| EEA director | Required (or โฌ25K bond) | No (company secretary must be Malta resident) |
| Year 1 cost | โฌ2,150โ7,750 | โฌ4,345โ10,445 |
| Strengths | Tech, pharma, financial services | Gaming, iGaming, financial services, shipping |
| Treaty network | 75+ | 70+ |
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Malta's refund timing is the key risk
The 6/7 refund is real โ but it is a refund that must be claimed and processed after distribution. Malta Tax Authority processing times have historically been 12โ24 months. During that period, the company has paid 35% CT and is waiting to receive 6/7 back.
For a company distributing โฌ1M/year: Malta CT = โฌ350,000. Refund due: โฌ300,000. Cash flow impact: the company has paid โฌ350,000 and waits up to 2 years for โฌ300,000 back.
This requires working capital to manage. Companies with strong cash reserves handle this easily. Startups or companies with tight cash may find this problematic.
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Malta's genuine strengths
iGaming / online gaming: Malta's MGA licence is the EU standard for online gambling. If you're in this industry, Malta is the jurisdiction. There is no equivalent in Ireland.
Financial services: MFSA-regulated fund managers, investment services firms, and insurance companies benefit from Malta's EU regulatory framework.
Shipping: Malta has favourable tonnage tax rules for shipping.
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Choose Ireland if: โ Technology company (SaaS, software, IT services) โ R&D-intensive business โ Cash flow sensitivity (no refund timing issue) โ English-speaking EU team
Choose Malta if: โ iGaming, online gambling, or related services โ Financial services requiring MGA or MFSA licensing โ Holding structure where the effective 5% rate justifies refund timing โ Shipping company
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This content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.