Share Transfers in Malta 2026: A Complete Director's Guide

By the EGM Assurance Editorial Team . Last reviewed May 2026 . 17 min read

Transferring shares in a Maltese company is rarely a simple administrative matter. Behind every share transfer sits a sequence of decisions that engage four different bodies of law: corporate law governing how shares can change hands; the company's own constitutional documents controlling pre-emption rights and transfer restrictions; the Income Tax Act and Capital Gains Rules determining whether tax is payable on any gain; and the Duty on Documents and Transfers Act setting the stamp duty position. Get any of these wrong and the transfer can be invalid, taxed incorrectly, or trigger personal liability for the directors who approved it.

This guide explains the complete process: when a transfer requires board approval, how share value is determined for tax and duty purposes, when capital gains tax applies and at what rate, when stamp duty applies and how the special rules for property companies and family business transfers work, and how the transfer is filed with the MTCA's International and Corporate Tax Unit (ICTU) and notified to the MBR. It reflects the position at May 2026, incorporating two important recent developments: the 1.5% family business rate extended to 31 December 2026 in the Budget for 2026, and the new BAROS single point of online submission for DDT10-exempt share transfers, effective from 1 December 2025.

1. When does a share transfer trigger the rules?

A share transfer for Maltese tax and duty purposes occurs whenever a person's interest in a Maltese company changes - not just on a paid sale. The legislation captures a broad range of transactions:

• A sale of shares for cash or other consideration (the classic case).

• A donation of shares (which can still trigger capital gains and duty even though no money changes hands).

• An exchange of shares for other assets (treated as two transfers).

• A transfer of value, where a change in the company's issued share capital or voting rights effectively shifts economic value from one shareholder to another (the "value shifting" rule).

• A reduction in the company's share capital that effectively transfers value to remaining shareholders.

• A causa mortis transmission of shares on death - outside the income tax on capital gains, but subject to duty under specific causa mortis rules.

The breadth of the legislation matters because directors and shareholders sometimes assume that informal arrangements - a verbal agreement, a handshake transfer between family members, or a paper exercise to "simplify" the cap table - sit outside the rules. They do not. Whenever the beneficial ownership of shares changes, or whenever value shifts between shareholders, the corporate, capital gains, and duty rules engage.

2. Corporate law process: what the Companies Act requires

Before considering tax and duty, the directors must satisfy the corporate law requirements. These are the procedural gates through which the transfer must pass before any tax filing becomes relevant.

Pre-emption rights and transfer restrictions

Most Maltese private limited companies have pre-emption rights and transfer restrictions in their Articles of Association. Under Section 209 of the Companies Act, a private company MUST restrict the right to transfer its shares - this is a statutory defining feature of a private company, not an optional design choice. The form the restriction takes is governed by the Articles, but typically:

• Pre-emption rights - existing shareholders have a right of first refusal before shares can be offered to outsiders.

• Board consent - the directors may have discretion to refuse to register a transfer to a person they consider unsuitable.

• Transfer process - the Articles will specify how a notice of intention to transfer must be served, the price determination mechanism (often by reference to an agreed valuation method), and the timing of acceptance.

Failure to follow the Articles' procedure can invalidate the transfer. Where the proposed transfer is between existing shareholders or to a family member, the Articles often provide for permitted-transferee exemptions, but each set of Articles is different and must be checked specifically.

Board approval

Most Articles require board approval before the share transfer is registered in the company's share register. The board's role is to verify that the corporate procedure has been followed (notices served, pre-emption period observed, no objections raised) and that the transfer is properly documented. The decision is recorded in board minutes - important evidence if the transfer is later challenged.

Share transfer instrument

The transfer itself is effected through a written instrument of transfer signed by the transferor (and, depending on the form used, the transferee). The standard Maltese instrument identifies: the name of the company; the number and class of shares being transferred; the consideration (or a statement that the transfer is by gratuitous title); the names and details of transferor and transferee; the date of transfer. The instrument is the document on which stamp duty is calculated and which is filed with the Capital Transfer Department.

Updating the share register and statutory registers

Once the transfer is approved by the board and stamp duty (if applicable) has been paid, the company's share register is updated to reflect the new shareholder. Share certificates are typically reissued. The company's register of members (one of the statutory registers required under the Companies Act) must also be updated.

MBR notification

Changes in shareholders must be notified to the Malta Business Registry. The annual return (filed within 42 days of the made-up date) reflects shareholders as at that date. Material changes during the year may need to be notified more promptly depending on the change - particularly where the change affects beneficial ownership.

Beneficial ownership filings

Where the share transfer changes the company's ultimate beneficial ownership (UBO) position, the change must be notified to the MBR within 14 days of occurrence under the Beneficial Ownership Regulations. This is a critical compliance point - BO filings are increasingly scrutinised by the MBR, and late or incomplete filings can attract penalties.

3. Share valuation: the foundation of everything that follows

Both capital gains tax and stamp duty are calculated by reference to the value of the shares being transferred - not necessarily the price the parties have agreed. The Income Tax Act and the Duty on Documents and Transfers Act each impose a deeming rule that captures the higher of the actual consideration paid and the market value of the shares.

Market value: how it is determined

For an unquoted Maltese company, market value is typically determined by reference to the net asset value (NAV) of the company, calculated from its most recent audited financial statements, with specific adjustments. The standard approach used by Maltese practitioners and accepted by the MTCA includes:

• Start with the net asset value from the audited balance sheet.

• Add back goodwill and other intangibles where appropriate.

• Adjust property values to current market value (the audited balance sheet typically carries property at depreciated historical cost - which is rarely market value).

• Adjust for any extraordinary items, related party balances, and contingent liabilities.

• Apply a minority discount where the shares being transferred do not give the transferee control of the company - typically rejected by the MTCA for transfers of controlling interests, but may be accepted for minority transfers in specific circumstances.

Where the company's audited financial statements are old (more than 12 months before the transfer date), interim management accounts may be required to support the valuation. The market value calculation is typically prepared by the company's accountant and submitted with the share transfer forms to the Capital Transfer Department.

Specific rule for property companies

Where the company holds significant immovable property, the property must be revalued to market value as at the date of transfer - not its book value. This is critical because a Maltese company with material property assets is treated as a "property company" under the duty rules (more than 75% of assets in immovable property situated in Malta), which attracts the higher 5% stamp duty rate rather than the standard 2%. The market value of the shares is calculated by:

• Taking the net asset value as per the latest financial statements.

• Replacing the book value of immovable property with the current market value of that property.

• Adding back goodwill.

• Adjusting for any excess of liabilities over assets.

For a property company, the market value calculation effectively brings the property value forward to current market. This significantly increases the duty base in many cases and is one of the largest planning considerations in any share transfer involving a property-holding company.

4. Capital gains tax on share transfers

Capital gains tax on the transfer of shares in a Maltese company is governed by Article 5 of the Income Tax Act and the Capital Gains Rules (Subsidiary Legislation 123.27). The tax is paid by the transferor (the seller) and is charged at the transferor's applicable marginal rate - up to 35% for individuals (or 35% flat for non-resident individuals on certain Maltese-source gains), or 35% for companies.

The basic charge

The general principle is that the gain is calculated as:

• Transfer value (= the higher of consideration received OR market value of the shares)

• LESS the cost of acquisition (adjusted for inflation under the Maltese inflation allowance rules)

• LESS allowable expenses on transfer (legal fees, valuation fees)

The resulting gain is added to the transferor's other income and taxed at the applicable marginal rate. Where the transferor is a Maltese company, the gain is taxed at 35% (subject to refund mechanisms after distribution).

Rule 5(1): the controlling interest deemed-consideration rule

Rule 5(1) of the Capital Gains Rules imposes a special deemed-consideration rule where the transfer is a transfer of a "controlling interest." Under this rule, the transfer value is the higher of:

• The actual consideration received; or

• The market value of the shares being transferred, measured by reference to the entire company - i.e. the market value of the underlying business represented by the percentage of shares being transferred.

A transfer is a transfer of a controlling interest where any one of the following criteria applies to the shares held by the transferor at any time during the 18 months preceding the transfer:

• The aggregate nominal value of the shares represents at least 25% of the nominal value of the issued share capital of the company; or

• The aggregate voting rights attached to the shares represent at least 25% of the total voting rights of the company; or

• The aggregate rights attached to the shares give the holder the right to be appointed (or to nominate or appoint, or to withhold the appointment of) a director of the company; or

• The aggregate rights to profits available for distribution attached to the shares represent at least 25% of the total rights to profits available for distribution to the ordinary shareholders of the company.

The 18-month look-back is important. The test is applied not at the moment of transfer but across an 18-month window before the transfer. A shareholder who has been gradually reducing their stake cannot escape the controlling interest rule simply by ensuring that, at the moment of the final transfer, they hold less than 25%.

The 18-month global transfer rule

Where two or more transfers of shares in the same company are made by the same or related persons within a period of 18 months or less, the transfers are deemed to be one global transfer made by the same person on the date of the last transfer. "Related persons" include the transferor's spouse, direct ascendants and descendants, siblings, and entities controlled by the transferor or related persons.

This anti-avoidance rule prevents shareholders from splitting a controlling-interest transfer into multiple smaller transfers below the 25% threshold to avoid the deemed-consideration rule. The MTCA aggregates the transfers and applies the controlling interest test to the global transfer.

Common exemptions from capital gains tax

• Transfers between spouses or former spouses on dissolution of the marital community.

• Transfers within a Maltese group of companies (where transferor and transferee are part of the same group and certain control conditions are met) - subject to clawback if the company subsequently leaves the group.

• Transfers of shares listed on the Malta Stock Exchange or on a foreign stock exchange recognised by the Commissioner for Tax (defined by reference to WFE membership or ESMA regulated markets).

• Transfers under the participation exemption - where the Maltese company is transferring shares in a qualifying participating holding (typically 5% or more equity in another entity).

• Reorganisations and restructurings within the same beneficial ownership.

• Specific reliefs for transfers of shares admitted to alternative trading platforms (rule introduced in late 2017 covering MSE-operated platforms).

5. Stamp duty (Duty on Documents and Transfers)

Separate from capital gains tax, stamp duty is charged under the Duty on Documents and Transfers Act (Cap. 364) on the document evidencing the share transfer. The duty is paid by the transferee (the buyer or recipient). The applicable rate depends on the nature of the company whose shares are being transferred.

Standard rate: 2%

Transfers of shares in Maltese companies are subject to stamp duty at the standard rate of 2% of the "real value" of the shares - the higher of the actual consideration and the market value of the shares.

Property company rate: 5%

Where the company being transferred is a "property company" - a company that mainly owns immovable property situated in Malta (broadly, more than 75% of its assets are immovable property situated in Malta, measured at market value) - the stamp duty rate is 5% rather than 2%. The 75% test is applied by reference to the market value of the immovable property (not its book value) against the total assets of the company. For a Maltese property-holding company, this distinction can be the difference between a duty bill of, say, €20,000 and €50,000 on the same transfer.

Family business reduced rate: 1.5%

In specific circumstances, transfers of shares qualify for a substantially reduced stamp duty rate of 1.5%. The rate applies to transfers by gratuitous title (i.e. donations) of:

• Marketable securities (shares) owned by individuals; or

• Commercial tenements (business property) that had been used in a family business for at least three years preceding the transfer.

The reduced rate applies where the transfer is to:

• The transferor's spouse;

• Descendants or ascendants in the direct line, and their spouses; or

• In the absence of descendants, to the transferor's siblings and their descendants.

The donation must be made by public deed. Importantly, once the 1.5% rate is applied, no other exemption or duty relief can be claimed in respect of the same transfer. Under the Budget for 2026, the reduced rate has been extended to 31 December 2026.

Standard exemptions from stamp duty

• Transfers between spouses or on dissolution of the marital community.

• Intra-group transfers where the transferor and transferee form part of the same group of companies and certain control conditions are met.

• Restructuring of holdings through mergers, demergers, amalgamations and re-organisations within a group of companies (this also applies to partnership reorganisations).

• DDT10 exempt companies (see Section 6 below) - the most commonly used exemption for share transfers in companies with non-resident ownership and non-Malta-resident business activity.

6. DDT10 exemption: when share transfers are duty-free

The DDT10 exemption - set out in Article 47 of the Duty on Documents and Transfers Act - is the most significant duty relief available for Maltese share transfers. It is a determination issued by the Commissioner for Tax and Customs (within the MTCA) confirming that a specific company qualifies for an exemption from duty on transfers of its marketable securities. The DDT10 exemption is widely used by international groups operating Maltese companies.

Eligibility conditions

Companies qualify for the DDT10 exemption if they satisfy ALL of the following conditions (in summary):

• More than 90% of business interest is carried on outside Malta.

• The company's turnover is not derived from activities carried on with customers or clients resident in Malta.

• The company's turnover is not derived from activities carried on directly or indirectly with non-resident customers who operate in Malta through a branch.

• The company's turnover is not derived from retail, catering, on-land entertainment, manufacturing or related productive activities, transport, agriculture or fishing carried on in Malta.

• The company's turnover is not derived from immovable property situated in Malta.

• More than 50% of the ordinary share capital, voting rights and rights to profits are held by non-resident persons (or by trusts whose beneficiaries are non-resident).

In practical terms, the DDT10 exemption fits Maltese companies that are international holding or trading vehicles with non-resident beneficial ownership and no commercial connection with Malta beyond their corporate seat. Maltese trading companies serving Maltese clients, family businesses, and property companies generally do not qualify.

The 3-year renewal cycle (post-2019 amendments)

Before 2019, DDT10 exemption was effectively granted at incorporation and continued for the life of the company. The DDT Act was amended such that determinations issued on or after 1 December 2016 are now valid for three years only. To maintain the exemption beyond the three-year period, the company must apply for renewal, demonstrating to the CfR that it continues to satisfy the eligibility conditions.

This means that DDT10 status is no longer a one-time event - it is a recurring compliance obligation. Companies that have historically benefited from DDT10 must monitor their renewal cycle. Failure to renew means that, from the expiry of the determination, all subsequent share transfers become subject to the standard 2% (or 5% property company) stamp duty rates.

Other DDT10 benefits

Beyond the duty exemption on share transfers, a valid DDT10 determination also brings:

• Exemption from provisional tax (the standard PT payment regime).

• Extension of the corporate tax payment deadline from 9 months to 18 months after the financial year-end.

These additional benefits make the DDT10 status valuable for international groups beyond just the share transfer duty saving - which is one reason the renewal process is worth managing carefully.

7. Filing with MTCA and MBR: the process in 2026

Once the transfer has been documented and any required board approvals obtained, the formal filings are made to two bodies: the MTCA (through its International and Corporate Tax Unit - ICTU) for tax and duty purposes, and the MBR for company registry and beneficial ownership purposes. The procedure that applies depends on whether the transfer is a DDT10-exempt transaction or a transaction involving the payment of stamp duty or capital gains.

Schedules under the Capital Gains Rules

The Capital Gains Rules (S.L. 123.27) require specific Schedules to accompany the share transfer documentation submitted to the MTCA, depending on the nature of the transfer:

• Schedule D - referred to in Rule 5(10) of the Capital Gains Rules.

• Schedule E - referred to in Rule 5(14) of the Capital Gains Rules. This is the Schedule typically used for exempt share transfers (including DDT10-exempt transfers).

• Schedule F - referred to in Rule 5A(5) of the Capital Gains Rules.

Transfers of shares listed on a recognised stock exchange, regulated market or multilateral trading system are exempt from the requirement to file Schedules D, E or F (or any supporting auditor's report or share valuation). The transferor nonetheless remains obliged to declare the transfer in the income tax return for the relative year of assessment if the gain is taxable in Malta.

NEW from 1 December 2025: BAROS single point of submission for DDT10-exempt transfers

In a major procedural update, the MBR and MTCA jointly announced (28 November 2025) that, with effect from 1 December 2025, a single point of online submission is now available through the BAROS platform for the following filings:

• Form T - Transfer or Transmission of Shares (MBR).

• Form H - Issue of Shares / Return of Allotments (MBR).

• MSR Form F - Merchant Shipping share registration forms.

The new BAROS facility applies EXCLUSIVELY to:

• Exempt share transfers under a valid DDT10 determination (Article 47 of the DDT Act) that require filing under Schedule E of the Capital Gains Rules; and

• Transactions that are exempt from filing a capital gains schedule.

Submissions must be made with documents duly signed using a Qualified Electronic Signature (QES) in accordance with the applicable MTCA guidelines. QES has the same legal validity as a handwritten signature under the EU eIDAS Regulation (Regulation (EU) No 910/2014). For DDT10-exempt transfers in scope, this means that clients no longer need to print forms or present physical documents for endorsement at the MTCA desk hosted at MBR offices - the entire submission is processed online through BAROS. The relevant BAROS User Guidelines are at Section 7 - Share Transfers and Return of Allotments.

Transactions still requiring traditional submission

Until further notice, the following continue under the existing (pre-BAROS) procedures:

• Share transfers involving the payment of stamp duty (i.e. any transfer not covered by DDT10 or another exemption from duty).

• Share transfers involving the payment of capital gains tax (i.e. any transfer where a chargeable gain arises).

For these transactions, the traditional process at the MTCA desk hosted at the MBR offices continues to apply, with physical documents required. The MBR and MTCA have indicated that further phases of digital integration are expected, but the timing has not yet been announced.

Documents typically submitted (whether via BAROS or traditional process)

• The signed share transfer instrument (the deed of transfer).

• The share valuation prepared by a Maltese accountant, supporting the market value position on which capital gains and duty have been calculated.

• Latest audited financial statements of the company (and interim management accounts where the audited statements are out of date).

• Evidence of the consideration paid (where applicable).

• Identification documents for transferor and transferee.

• Where a DDT10 exemption is being claimed, the current determination certificate from the Commissioner for Tax and Customs.

• Where the family business 1.5% rate is being claimed, supporting evidence of the family relationship and the three-year usage history of the business.

• The applicable Capital Gains Rules Schedule (D, E or F as relevant), unless the transfer is exempt from Schedule filing.

MBR Form T filing

Separate from the MTCA / ICTU filing, the company itself must file Form T with the MBR within 14 days of the date on which the share transfer is registered with the company. For transmissions causa mortis, the timing is within one month of registration. Form T can now be submitted via BAROS (as part of the new single-point-of-submission facility for DDT10-exempt transfers, or under the standard BAROS process for transfers involving duty/capital gains payment).

Beneficial ownership updates

Where the transfer changes the company's ultimate beneficial ownership, the change must be notified to the MBR within 14 days under the Beneficial Ownership Regulations. This filing is separate from Form T and operates regardless of which BAROS or traditional process is used for the share transfer itself.

Timing and interest

The share transfer is technically chargeable to duty from the date of the transfer document. Late lodgement attracts interest at 0.33% for every 30 days or part thereof on unpaid duty, plus penalties for late filing. Where capital gains tax is payable, the tax is typically paid by the transferor at the time of filing the share transfer with the MTCA. The transferor receives a clearance from the Commissioner upon payment, confirming the tax position has been settled.

8. Practical scenarios

Scenario A: Internal restructuring between commonly owned companies

Two Maltese trading companies both 100% owned by the same individual. The individual wishes to interpose a Maltese holding company between herself and the trading companies. The transfer of the trading company shares to the new holding company qualifies for the intra-group / commonly owned exemption from both capital gains tax and stamp duty, provided the structure is correctly documented and the holding period requirements are observed. A clawback may apply if any of the companies subsequently leave the group within a specified period.

Scenario B: Family business succession to children

A family business has been operated by the parent for 20 years. The parent wishes to donate the shares to two adult children. Provided the company satisfies the conditions for the 1.5% family business rate and the donation is made by public deed, the duty on the transfer is calculated at 1.5% rather than 5% (assuming the company is not a property company) or 2% (if it is). On the income tax side, gifts to spouse, descendants and ascendants are generally not subject to capital gains tax - making the family business succession route a tax-efficient way to pass control to the next generation.

Scenario C: Sale to a third party of a controlling interest

A founder owns 100% of a Maltese trading company. He sells the entire shareholding to an unrelated third-party purchaser. The transfer is a transfer of a controlling interest under Rule 5(1) of the Capital Gains Rules, so capital gains tax is calculated by reference to the higher of the consideration and the market value of the entire company (proportioned to the shares transferred). Stamp duty is payable by the purchaser at 2% (or 5% if it is a property company), unless DDT10 status applies.

Scenario D: Property company sale where DDT10 does not apply

A Maltese company owns a portfolio of rental properties in Malta. The shareholder sells 60% of the shares to a property investment partner. The company is a property company (more than 75% of assets in Maltese immovable property). The stamp duty rate is 5% on the market value of the 60% shareholding, calculated using the property company NAV method (replacing book values of property with market values). Capital gains tax on the transferor is calculated on the higher of consideration and market value, and the 60% transfer is a controlling interest transfer under Rule 5(1).

Scenario E: Issue and dilution - the value shifting rule

A founder holds 100% of a Maltese company worth €1,000,000. He arranges for the company to issue new shares to an investor at nominal value, taking the investor's shareholding to 30%. Although no shares have been transferred between persons, the founder's economic value has been reduced - he now holds 70% of the company. The legislation deems a transfer of value to have occurred, and the founder may face capital gains tax and the company may face stamp duty on the value shifted. This is an important trap in any restructuring or capital injection.

9. Common pitfalls and director duties

• Failing to follow the Articles' transfer procedure - pre-emption notices, board approval, the form of instrument. A transfer not made in accordance with the Articles can be invalid and the directors who registered it may face challenge.

• Underestimating market value - the MTCA examines share transfers carefully, particularly where consideration appears low relative to the company's financial position. An understated market value can result in additional tax, interest and penalties - plus reputational consequences.

• Forgetting the controlling interest 25% test - the deemed consideration rule applies based on holdings throughout the 18 months before transfer, not just at the date of transfer.

• Not aggregating related party transfers - the 18-month global transfer rule captures sequences of small transfers that, together with related-party transfers, would qualify as a controlling interest.

• Treating DDT10 as permanent - post-2019, DDT10 determinations require renewal every three years. A lapsed DDT10 creates duty exposure on the next share transfer.

• Confusing the property company test - the 75% test is by reference to market value of property, not book value. A company with €500,000 of property at book value but €2 million at market value, against total assets of €2.5 million, IS a property company despite the book value position.

• Missing the 1.5% family business deadline - the rate has been extended to 31 December 2026 in the Budget for 2026, but is subject to annual extension. Planned succession transfers should not be delayed indefinitely.

• Forgetting beneficial ownership filings - changes in UBO must be notified to the MBR within 14 days. This is often overlooked alongside the share transfer itself.

• Not updating the audited financial statements - changes in shareholders or controlling shareholders can have audit implications. Where the company's position changes, the audit approach for the next year should reflect this.

10. Frequently asked questions

Does a gift of shares to my child trigger tax?

It depends. Transfers of shares by gratuitous title from a parent to descendants in the direct line are generally exempt from capital gains tax - the family transfer exemption applies. On the stamp duty side, the standard rate would be 2% (5% for a property company), but the family business reduced rate of 1.5% may apply if the transfer is made by public deed, the company has been used in the family business for at least three years, and the relationship qualifies. Both exemptions and reduced rates are documented and conditional - take advice specific to your circumstances.

How is the market value of unquoted shares determined?

Typically by reference to the net asset value (NAV) of the company as per the audited financial statements, adjusted for goodwill, current market value of immovable property (rather than book value), related party balances and contingent liabilities. The calculation is prepared by the company's accountant and submitted with the share transfer to the Capital Transfer Department. Where the audited financial statements are more than 12 months old, interim management accounts may be required to support the valuation.

What is the 'controlling interest' rule in plain English?

Under Rule 5(1) of the Capital Gains Rules, a transfer is a transfer of a controlling interest where, at any time during the 18 months before the transfer, the transferor's shares satisfied any one of four criteria: (1) at least 25% of the nominal value of the issued share capital; (2) at least 25% of the voting rights; (3) the right to be appointed, or to nominate or withhold the appointment of, a director; or (4) at least 25% of the rights to profits available for distribution to ordinary shareholders. The deemed consideration for capital gains tax purposes is the higher of the actual price and the market value of the shares as a proportion of the entire company. This prevents controlling shareholders from selling at undervalue and reducing the tax bill.

How does the DDT10 exemption work?

The DDT10 exemption - issued under Article 47 of the DDT Act - exempts shares transfers in qualifying companies from stamp duty. It applies primarily to Maltese companies with non-resident ownership and business activities carried on outside Malta. The exemption is granted by determination of the Commissioner for Tax and Customs (within the MTCA), and determinations issued from 1 December 2016 onwards must be renewed every three years. The exemption also relieves the company from provisional tax and extends the tax payment deadline from 9 to 18 months from year-end.

What is a 'property company' under Maltese duty rules?

A company where more than 75% of its assets consist of immovable property situated in Malta, measured by reference to market value (not book value). The 75% test focuses on Maltese immovable property specifically - foreign property does not count. Share transfers in a property company attract the higher 5% stamp duty rate rather than the standard 2%, calculated using the property company NAV method that brings property values to current market.

Are transfers of shares listed on the Malta Stock Exchange tax-exempt?

Yes. Capital gains arising from transfers of shares listed on the Malta Stock Exchange are exempt from income tax under specific provisions of the Income Tax Act, and the transfer instrument is exempt from duty. The exemption has been widened to include transfers of shares listed on foreign stock exchanges recognised by the Commissioner for Tax - broadly, members of the World Federation of Exchanges (WFE) and ESMA-regulated markets within the EEA. Importantly, transfers of listed shares are also exempt from the requirement to file Schedules D, E or F under the Capital Gains Rules, although the transferor still declares the transfer in their income tax return if the gain is taxable in Malta.

What documentation do I need to submit to the Capital Transfer Department?

The signed share transfer instrument; a share valuation prepared by a Maltese accountant; the company's latest audited financial statements (and any management accounts if material time has passed); evidence of consideration where applicable; ID documents for transferor and transferee; and any relevant exemption documentation (DDT10 determination, family relationship evidence for the 1.5% rate). The Capital Transfer Department typically reviews the file before issuing tax and duty clearance.

How long does the share transfer process take in practice?

From start to finish, a straightforward share transfer typically takes 4-8 weeks: corporate procedure and instrument drafting (1-2 weeks), share valuation preparation (1-2 weeks), Capital Transfer Department lodgement and clearance (2-4 weeks), and post-clearance MBR notifications and beneficial ownership filings. More complex transfers - controlling interest sales, property company transfers, transfers requiring CfR clearance - can take longer.

Can a share transfer affect the company's audit exemption position?

Yes - indirectly. If the share transfer changes the company's shareholder profile, it may affect the company's ability to qualify for certain reliefs. For example, the audit exemption startup waiver under Rule 3 of the Audit Exemption Rules (LN 139/2025) requires all shareholders to be individuals holding MQF Level 3+ qualifications; a share transfer admitting a corporate shareholder would forfeit the waiver. Similarly, share transfers can affect fiscal unit eligibility and other tax positions linked to ownership.

Does a share transfer require an updated audited balance sheet?

Not necessarily, but it usually requires a recent valuation supported by financial information that is reasonably current. Where the most recent audited balance sheet is more than 12 months old, the Capital Transfer Department typically expects interim management accounts to support the share valuation. For property companies, current market valuations of the property assets are required regardless of the audit date.

Can share transfers now be submitted online via BAROS?

Yes - for certain transfers. With effect from 1 December 2025, the MBR and MTCA jointly introduced a single point of online submission through BAROS for Form T (share transfer), Form H (return of allotments) and MSR Form F (Merchant Shipping). The facility applies exclusively to DDT10-exempt share transfers requiring Schedule E filing and transactions exempt from filing a capital gains schedule. Documents must be uploaded with a Qualified Electronic Signature (QES) under the EU eIDAS Regulation. For transactions involving the payment of stamp duty or capital gains, the traditional in-person submission process at the MTCA desk hosted at the MBR offices continues to apply until further notice.

What is a Qualified Electronic Signature (QES)?

A QES is an advanced electronic signature created using a qualified signature creation device and based on a qualified certificate from an EU-accredited Qualified Trust Service Provider (QTSP). Under the EU eIDAS Regulation, a QES has the same legal validity as a handwritten signature and is recognised across all EU Member States. In Malta, holders of a valid eID card (citizen or expatriate) can use the QES service free of charge through the Identità framework, or obtain a QES from an EU-accredited QTSP. For BAROS submissions, the QES is what enables the entire process to be completed digitally without physical signatures or documents.

What happens if I don't pay the duty?

Stamp duty is technically chargeable from the date of the transfer document. Unpaid duty accrues interest at 0.33% for every 30 days or part thereof. Penalties also apply. More fundamentally, the share transfer cannot be registered in the company's books or notified to the MBR until duty is paid - so a non-paying transfer is effectively non-operative until the duty position is regularised.

Related guides from EGM Assurance

• Setting Up a Company in Malta: Step-by-Step Guide

• Becoming a Malta Company Director: Duties, Liability and Personal Exposure

• Corporate Filings and Beneficial Ownership in Malta

• Audit Exemption in Malta 2026: LN 139/2025 Complete Guide

• Malta Fiscal Unity Regime: Tax Consolidation Guide

• Company Liquidation and Dissolution in Malta

Authoritative references

• Income Tax Act (Cap. 123) - Article 5 (capital gains)

• Capital Gains Rules (S.L. 123.27) - Rule 5 (controlling interest)

• Duty on Documents and Transfers Act (Cap. 364) - Article 47 (DDT10)

• Companies Act (Cap. 386) - Section 209 (private company restrictions)

• Office of the Commissioner for Tax and Customs - Share Transfers and ICTU

• MBR / MTCA Joint Notice - Single Point of Submission for Form T, Form H and MSR Form F via BAROS (28 November 2025)

• BAROS User Guidelines - Section 7: Share Transfers and Return of Allotments

• EU eIDAS Regulation (Regulation (EU) No 910/2014) - Qualified Electronic Signatures

• Identità - Maltese Qualified Electronic Signature Guide

• Malta Business Registry - Beneficial Ownership Regulations

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This article is prepared by EGM Assurance for general informational purposes and reflects the legal and regulatory position in Malta as at May 2026, including measures announced in the Budget for 2026. Share transfers depend entirely on the specific facts of each case - corporate documents, financial position, beneficial ownership, family relationships, and group structure. Always obtain specific advice from a qualified professional before initiating a share transfer.