I'm thinking of moving to Malta but I need to confirm my understanding of taxation.
Is any Canadian submitting RRSP or RRIF withdrawals to his/her bank account in Malta?
Supposedly, CRA (https://www.canada.ca/en/revenue-agency … aimer.html) will withhold 15% from periodic payments from RRSP or RRIF for Canadians residing in Malta and that this will be the final tax bill. (I think periodic payments can only pertain to the RRIF.)
Supposedly, for Canadians residing in Malta with the Retirement Residence Programme or Global Residence Programme visa, Malta will charge a flat tax rate of 15% on income submitted to Malta.
Are there any Canadians doing this?
So, let's say you have regular withdrawals from your RRIF and you withdraw $50,000. CRA will take $7,500. You submit the remaining $42,500 to your Maltese bank account. When you file your Maltese income tax return, you pay 15% of $42,500 or $6,375. You deduct the $6,375 paid to CRA (because of tax treaty) to get the $6,375 back from the Maltese government.
Is that how it works?
Let's say you submitted $22,500, instead of $42,500, to your Maltese bank account, leaving $20,000 in your Canadian bank account. When you file your Maltese income tax return, you pay 15% of $22,500 or $3,375. You deduct the $3,375 paid to CRA (because of tax treaty) to get the $3,375 back from the Maltese government. Then next year, you submit the $20,000 from your Canadian bank to your Maltese bank. But in this second year, you withdrew another $50,000 from your RRIF, CRA takes $7500 and you submit $42,500 (along with the $20,000) to your Maltese bank. When you file your Maltese income tax return, you pay 15% of $62,500 or $9,375 in taxes, deduct $9,375 paid to CRA to get the $9,375 back from the Maltese government.
Is that correct?
