Table of Contents
Introduction
An employee's tax status is determined by the Tax profile, which can be set up from the Employment Details section of the employee setup file.
Changing Tax Profile
Go to HR > Employees.
Select the employee whose tax status you would like to change and click on the Edit icon.
Scroll down to the Employment Details section and choose the new Tax profile from the drop-down menu.
Click the Save ✔️ icon to commit any changes.
⚠️ Caution
Once the tax profile is changed, Indigo will recalculate the tax contributions owed for the whole payroll year based on the new tax profile.
This means that if you change the Tax Profile mid-year, it will also affect previous tax contributions.
Most Common Tax Profiles
Most Common Tax Profiles
Below is a list with short descriptions of the most common tax profiles you can find defaulted in Indigo. If none of the default tax profiles applies to your employees, feel free to create one yourself. More on this 👉 here.
⚠️ Ensure you collect data on the number of children each employee has to accurately assign the proper tax profile rates. 👇
M1-SINGLE: for full-time single employees.
*M2-PARENT: for full-time employees who aren't married and have one child.
*M2-PARENT2: for full-time employees who aren't married and have two or more children.
*M3-MARRIED: for full-time married employees without children.
*M3-MARRIED1: for full-time married employees with one child.
*M3-MARRIED2: for full-time married employees with two or more children.
NON-TAXABLE: for employees residing in Malta who are non-taxable.
PT-STANDARD: for part-time employees who are already in full-time employment with another company , students/apprentices, or pensioners (all usually taxed at 10%).
📋 Note: The tax profiles marked with * have been introduced or modified with the budget changes for 2026. Their tax rates are fully backward compatible with 2025 and previous years, hence we highly recommend to go through the list of your employees and update their tax profiles accordingly, where needed.
🔦 Let's shed some light: full-time vs. part-time
🔦 Let's shed some light: full-time vs. part-time
The terms full-time and part-time in Malta do not refer to the number of hours worked, but rather to the source of an employee’s main income.
Full-time employment means that your company is the employee’s primary source of income. In this case, you are responsible for deducting Social Security Contributions (SSC) and applying the single, married or parent tax profiles, regardless of the number of hours they work for you.
Part-time employment means the employee already has a full-time job elsewhere, so your company is not their main source of income. In this case:
You are not responsible for SSC deductions.
You apply the part-time tax profile (income taxed at a flat 10% rate, up to €10,000 per year).
Related Articles
Set up New Tax Profiles