Accounting for Restaurants and Bars in Malta

Starting a business in Malta, including one that operates in the food and beverage sector, is not difficult, which is why there are plenty of such enterprises operating here. After the operations commence, however, the business owners need to comply with various requirements, among which legal and accounting ones are very important.

For those who have bars and restaurants, whether they are at the beginning or have been on the market for a while, our accountants in Malta can offer tailored accounting and audit services. We invite you to read how we can help you.

Taxes to be paid by restaurants and bars in Malta

Maltese restaurants and bars are subject to various financial requirements, among which is paying certain taxes. Among these, the corporate tax and the value added tax (VAT) are the most important ones. To these, specific excise duties on certain goods may apply.

At first glance, such businesses must consider:

• the corporate tax, which is levied at the standard rate of 35%, however, Malta has a special tax credit system applied if specific conditions are met;
• the VAT, which is levied at a standard rate of 18%, however, certain supplies are taxed at reduced rates and food for human consumption (not served in catering) is exempt with credit (0%);
• excise duties on alcohol and tobacco products.

Restaurants and bars must also issue fiscal receipts for each supply they make, which is where specific accounting rules need to be observed.

If you are running a restaurant or bar and need accounting services in Malta, our specialists are at your disposal with tailored assistance in compliance with the regulations applicable in this sector, including employment-related ones.

A company’s or organization’s accounting specialists are in charge of conducting internal audits. The corporation does not share these audits with the public. They are instead ready for management and other internal stakeholders to use. However, when seeking an impartial opinion, an audit in Malta can also be completed by our experts.

Payroll reporting is crucial to better understanding corporate operations since the data enables more informed decision-making. If you are a foreign investor with a company in Malta and need support in such matters, contact us. We are at your disposal with tailored payroll services in Malta, while you focus on your activities.

Corporate taxation applied to bars and restaurants

The corporate tax is the most important levy to pay by restaurants and bars in Malta. The 35% rate applies to their taxable income, after deducting expenses like:

• rent;
• utilities;
• salaries of the employees;
• costs associated with the maintenance of the equipment;
• marketing expenses.

Such businesses must file corporate tax returns on an annual basis, a procedure that can be carried out with the help of our accountants in Malta, who are accustomed to the filing deadlines, so that penalties are avoided.

If you want to launch such a venture in Malta, it is worth noting that as a shareholder, you can benefit from the tax imputation system of this country and thus obtain important refunds. This way, you can reduce the corporate tax burden on your business.

When it comes to the employment levies applied to Maltese bars and restaurants, you need to consider payroll and social security contributions, as follows:

• salary taxes are imposed under the Pay-as-You-Earn system, which is deducted from employees’ wages in accordance with their income;
• the 10% employer contribution on the employee’s basic weekly wage (capped), plus 0.3% to the Maternity Leave Trust Fund;
• the 10% employee contribution, which is deducted from the salary.

We remind employers that these taxes must be paid monthly, and they can rely on our payroll services in Malta to ensure compliance.

Services provided by our accounting firm in Malta to bars and restaurants

Our accountants in Malta have a lot of experience in providing assistance and offering various services to companies operating in all economic sectors that are required to comply with special tax impositions, among which are also shipping companies and restaurants, and bars.

When it comes to the food and beverages industry, which covers restaurants and bars in Malta, there are special requirements to be met, among which are those related to VAT.

Here are some of the accounting services we can provide for restaurants and bars in Malta:

1. VAT registration, which in the case of restaurants and bars is recommended upon incorporation;
2. guidance in respecting the tax regulations applied to the supply, sale, and serving of food and beverages;
3. assistance in respecting the regulations related to the import of alcoholic drinks and cigarettes subject to the excise tax;
4. audit services in accordance with the national or international standards are also available with us;
5. financial statements preparation is also available. The approved audited financial statements must be filed with the Registrar of Companies within 10 months plus 42 days of the accounting year end, and they must be approved within 10 months of the accounting year end. In order to respect these deadlines, feel free to address our auditors in Malta.
6. assistance in obtaining various tax incentives and deductions applicable in the food and beverages industry, as well as in tourism.

Do not hesitate to send us an email with the services you need, so that we can provide you with a personalized accounting package. Our auditors in Malta can also provide you with tailored assistance.

Special VAT rates for the hospitality industry in Malta

As presented above, hospitality businesses must also pay the value added tax. While most services and supplies of goods are subject to the standard rate, there are also a few reduced rates applicable as follows:

• a 7% rate for accommodation (e.g. hotel stays), while restaurant, catering and dine-in services are taxed at the standard 18%;
• a 5% rate for items such as certain confectionery, printed matter and electricity.

The small-enterprise (Article 11) exemption threshold is an annual turnover of EUR 35,000; above it, Article 10 registration is required. One of our accounting services for restaurants and bars in Malta is VAT registration. We can also assist with the filing of VAT returns as follows:

• on a monthly basis if you run a large establishment;
• on a quarterly or annual basis if you have a small hospitality business.

Other taxes/costs to be paid by bars and restaurants in Malta

One of the most important levies to consider when you run a hospitality business in Malta is related to the premises of the company. This is very important as it has a great contribution to its success. From this point of view, you can consider:

• rent, which is agreed with the landlord;
• stamp duty (duty on documents) if you want to buy your own building for which you must pay a 5% transfer fee calculated based on its value.

Our Maltese accountants can help you review rental agreements to understand what they entail from a taxation point of view.

Tailored payroll services in Malta

One of the essential parts of running a restaurant or bar in Malta is the staff. From managers to chefs and waiters, these businesses are some of the most important employers in the country. Setting up the payroll for such companies is one of the most important steps right from the beginning.

All the formalities related to setting up the programs under which the payroll will run. Drafting the paperwork and filing it with Jobsplus and the Commissioner for Tax and Customs, setting up personnel’s bank accounts, and making payments in accordance with employees’ salaries.

We will also register the employer and employees with all the authorities regulating labor relations, including for social security payments.

Managing employee payments is the process of payroll processing. It includes everything, including entering an employee into your payroll program and distributing paychecks to them. However, this is a strenuous task most of the time, which is why many firms use our payroll services in Malta and use their remaining resources for other actions.

Support in accessing tax credits in Malta

If you plan to open a food and beverages business in Malta, you will also want to know the benefits that come with such an enterprise. One of the most important refers to the possibility of accessing several tax credits. According to our Maltese accountants, here are some of them:

• the Catering Capacity Building enabled by Malta Enterprise, and through which you can obtain a tax credit of up to EUR 10,000 for 75% of the eligible costs to develop catering capacities (among these costs are also those related to hiring qualified personnel such as chefs);
• the Accommodation and Food Services tax credit, under which you can benefit from a credit of up to EUR 50,000 for 20% of eligible costs of your business;
• the Micro Invest Program, renewed for 2026-2030, through which you can benefit from a tax credit of up to 65% of eligible costs for your business.

Please note that the Micro Invest Scheme can bring an additional tax credit of 20%, so a total of 85%, if your business operates in Gozo.

Please note that for each type of credit specific conditions must be met and documents are required to prove the eligibility conditions. Our accounting firm in Malta is at your disposal with tailored services that can include:

• verifying if your business’ revenue and costs may be eligible for one or more of the tax credits above;
• checking whether your company meets the enterprise status that enables it to obtain the sought tax credit;
• preparing the documents to ease the application for the tax credit.

Our auditors in Malta can perform the necessary audits to ensure you can benefit from the above-mentioned financial schemes.

Assistance in filing for government grants and incentives

If you run a restaurant or bar in Malta, you can also benefit from several grants and subsidies from the Government, apart from the ones presented above. Some of the most attractive are:

• the Sustainability and Digitisation Grant is available for startups that invest in sustainability and digitization projects through which you can obtain up to EUR 100,000 per project;
• the Industrial Space Rental Grant, which enables you to rent space for the expansion or creation of a new bar or restaurant and through which you can obtain up to EUR 150,000 for a period of 3 years (applications are open until 2030);
• the Accelerator Programme Grant, through which you can access up to EUR 100,000 during the first 7 years of activities if you have a startup.

Our accountants in Malta can help you apply for any of these grants and thus expand or even open a new restaurant or bar.

If you need assistance related to the accounting of restaurants and bars in Malta, our specialists are at your disposal. Do not hesitate to contact our accountants in Malta and provide us the necessary details so we can help you.