Navigating the complexities of crew employment, flag state requirements, tax regulations and social securities can be daunting. Therefore, there is often a need to outsource arrangements to a capable third-party provider such as Oceanskies.
When considering Maltese flagged vessels it is important to know what is required of the employer and employee in order to comply.
The Malta flag has become one of the most popular European flags for yachts of all sizes. Through their office in Malta, Oceanskies register dozens of yachts each year with Transport Malta, the governmental body responsible for maritime, land and air transport in Malta.
Who is Eligible for Maltese Social Security?
All EU national and resident seafarers working on a Malta-flagged yacht must be registered with the department of social security in Malta unless they are already contributing to another EU social security regime.
Maltese Tax
Maltese tax only has to be handled if a crew member has a permanent address and resides in Malta. Those seafarers who are required to pay Maltese tax will have their rate confirmed based on individual circumstances. It is likely they would qualify for a reduced rate of 15% due to the conditions of Article 56 (17).
Maltese Social Security Contributions:
Maltese social security contributions are percentage-based and are calculated weekly. Contributions are impacted by the amount of Mondays worked each month. Weekly contributions are taken at 10% of the individual’s basic weekly wage (there is a maximum cap). In 2024 if the basic weekly wage is more than €532.29, both parties’ contributions are capped at €52.23. Both the employer and employee are responsible for making these contributions meaning total weekly contributions per seafarer would be €106.46.
Maternity contributions are to be covered only by the employer and are calculated weekly with a lower salary percentage of 0.30%. The cap still applies meaning those earning more than €532.29 per week will owe €1.60 per Monday worked.
Benefits of The Malta Social Security Scheme
Being eligible and contributing to the Malta Social Security scheme comes with some benefits:
1. A European Health Insurance Card is offered to those insured in Malta and residing in an EU member state other than Malta;
2. Unemployment benefits in the seafarer’s country of residence, claimable following the completion of a U1 form;
3. Pension secured at a rate of benefit reflecting the length of the claimant’s insurance in their scheme paid by any EU, EEA state and Switzerland; and
4. Protection from the repercussions of the French Decree 2017/307 by means of mandatory returns and payments on social security, amongst others.
The full list of benefits available when contributing to the Malta Social Security scheme can be found on the Maltese government website.
Employment of crew through a non-EU (offshore) yacht owner or employment company does not exempt either the employer or the employee from the obligation to make social security contributions in Malta.
Crew members who are employed by a non-EU company who are not making social security contributions to the Malta department of social security need to take action and can contact Oceanskies for further assistance.
Oceanskies provides Malta social security support for no extra charge on their standard fixed fee programme. Get in contact with [email protected] or visit www.oceanskies.com today to find out more about how they can help you.
