Payroll Administration Services in Malta

The outsourcing of companies’ payroll frees up resources and valuable human capital for our clients. Our confidential and customised payroll team caters for all the formalities involved in fulfilling all your business’ payroll needs.

Outsourcing of Payroll

Companies which are engaged in employment activities in Malta, are required to keep full records for each employee, to include amounts paid as salaries, bonuses, allowances, any other additions, together with any deductions required by law relating to income tax and social security contributions (NI) from the date of engagement to the date of termination of employment. It is very important that statutory requirements are strictly adhered to.

CSB Group’s dedicated outsourced payroll advisors assists clients with their payroll requirements where the outsourcing of payroll is required. CSB Group currently provides payroll services to well over 70 companies which operate within the online gaming, financial services, retail, shipping, marketing, consultancy services amongst others.

Currently the largest payroll being administered consists of 200 employees. CSB Group’s Payroll Services are further complemented by Tax, Employment Law and HR Consultancy.

Cloud-based Payroll System

Through cloud based payroll systems used in the generation of clients’ payrolls, we are able to provide clients with more value added services both for their employees and their HR-related functions. Employees are provided with access to their own online portal to view payslips, FS3s, apply for leave electronically.

Leave approval is facilitated and integrated within the payroll system. Once approved by respective managers, it is automatically shown and catered for in employees’ payslips. Therefore no separate leave systems need to be maintained, rather it can be catered for within the same online payroll system 

Payroll Function Setup

Our team can handle the setting up of the payroll function and the registering of the employees that will be working in Malta. This includes: 

CSB Payroll Team maintain leave records for each employee so that employers and employees know exactly the leave entitlement, leave availed of  and balances at any point in  time.  This applies for vacation, sick leave and other types of leave entitlements.

Income Tax Deductions

Deductions relating to income tax are calculated and deducted from the gross salary on a monthly basis, using a system known as the Final Settlement System (FSS).  

Tax is computed according to the single, married or parental rates depending on which applies to the particular employee. Part-time rates may also apply if the employee is fully employed elsewhere (subject to certain conditions).  Rates can be viewed here.

If an employee spends less than 183 days in Malta, non-resident rates of taxation may need to be applied. In the case of director fees, different rates of taxation might need to apply. 

In order to put your mind at rest, CSB Payroll & Tax Teams will advise you on the appropriate tax rates to be used and applied for your employees & officers of the company. 

Social Security Contribution Deductions

Deductions relating to Social Security Contributions (“SSC”) are made on a monthly basis. As outlined above, on a monthly basis the employer will need to submit to the Commissioner of Inland Revenue, a return (the FS5) summarising the following:

This will need to be accompanied by the relative payment for these deductions.

Annual Submissions

On an annual basis, the FS7 and FS3s are prepared and submitted to the Inland Revenue Department in Malta. FS7 is an annual declaration for the company’s total amount of salaries, tax, NI and maternity fund contributions for all its employees. FS3 is an annual declaration for each employee’s annual gross salaries and annual deductions of income tax and NI contributions. Original of the FS3s will also be sent to the respective employees’ addresses because these will then be required for the compilation of their personal income tax returns. The deadline for the submission of the FS7 and FS3s is 15th February of the following year. At CSB Group, we can also assist with the completion of the personal income tax returns for the respective employees which are due by 30th June of the following year.

Maternity Leave 

Assistance is also provided on completion of the following:

Employment Contracts

CSB Legal can assist in the drafting and preparation of the respective employment agreements / contracts (be they definite or indefinite). Working together, Payroll and Legal can assist clients in terms of specific employment regulations relating to probation, notice periods, leave entitlements (including wage regulation orders) (for all types of leave including vacation leave, sick leave, maternity leave, etc), among other advice.