Payroll in Malta: A Friendly Guide 2026
Once we already taught the payroll topic in very general terms, we decided to come back to this subject because it’s a very common client request. And when we start working together, there are always lots of questions about how payroll actually works in Malta.
As usual, in general, everything seems simple – especially if you have a fixed annual salary without any adjustments and use an online calculator. But things aren’t always that straightforward. What about various allowances like health insurance, meal vouchers, bonuses, and overtime pay, which all need to be integrated into the payroll system? Or maternity contributions, sick leave, and other statutory benefits? Suddenly, payroll starts to sound a lot less simple.
We’re here to help you understand payroll in Malta. Let’s start with the basics, and in future articles, we’ll go deeper – digging deeper and deeper into all the details.
- Minimum Wage in Malta
As of 2025, the national minimum wage in Malta is approximately €961 per month for full-time work. The government reviews and adjusts this figure annually to account for inflation and economic conditions.
- Payroll Cycle
Salaries are typically paid every four weeks according to a regular payment schedule.
- Payroll Calculation
Payroll is determined based on the gross salary, with deductions for taxes and social security contributions, and the addition of any applicable allowances, bonuses, or other benefits.
- Contribution
Social security contributions form a key part of payroll in Malta. Both employers and employees contribute around 10% of the gross salary, up to defined thresholds.
Malta also has a progressive income tax system, with rates starting at 0% for the lowest earnings and increasing to 15%, 25%, and up to 35% for higher incomes. Taxable income thresholds vary based on marital status and family circumstances.
- Working Hours
A standard full-time workweek in Malta consists of 40 hours, usually divided into 8-hour days.
Overtime is typically paid at 1.5 times the regular hourly rate for any hours worked beyond 40 per week, unless different rules apply to specific industries.
- Leave and Holidays
Employees in Malta are entitled to various types of leave:
- Annual leave (vacation): typically, 24 working days per year for full-time staff.
- Public holidays: paid statutory holidays recognized nationally.
- Sick leave: paid leave for illness, usually requiring medical certification.
- Maternity leave: paid leave for new mothers.
- Paternity and parental leave: time off for fathers and parents under statutory provisions.
- Other leave: includes bereavement leave, jury service, or court witness leave.
- Termination, Notice, and Probation
Maltese labor laws regulate termination procedures, notice periods, and probation periods. The required notice period depends on the employee’s length of service, while probation periods give both employer and employee a chance to determine if the role is a good fit.
The basics of payroll in Malta are easy to grasp, but the details matter; in our upcoming articles, we’ll guide you through each section with practical tips and examples.
Need a hand? Our payroll outsourcing services in Malta cover everything, from salary calculation and leave management to payslip preparation and statutory form submissions – just get in touch for a quote.
