iGaming Malta — VAT rules and invoicing for MGA-licensed operators
Why the MGA licence makes most gambling supplies exempt, where the 18% VAT does apply, and how to invoice cross-border platform fees correctly.
Malta is the EU's largest licensing hub for online gambling, with the Malta Gaming Authority (MGA) supervising over 300 operators. VAT treatment for iGaming is one of the most complex areas of Maltese tax law: the gambling services themselves are largely exempt under the Fifth Schedule of the VAT Act, but the B2B platform fees, software-as-a-service supplies, white-label arrangements and ancillary services (KYC, payment processing, affiliate management) are usually fully taxable at 18%. Getting the invoicing wrong is expensive — CFR audits in the iGaming sector are frequent and the place-of-supply rules trigger OSS or local registrations in dozens of EU jurisdictions.
- B2C gambling to consumers: exempt under VAT Act Fifth Schedule (Item 9), no VAT on the wager itself.
- B2B platform fees, white-label, SaaS: taxable at 18% Malta, or shifted to the customer via reverse charge if buyer is EU VAT-registered.
- Affiliate commissions: taxable at 18% if affiliate is in Malta; reverse charge if affiliate is EU-established.
- Non-EU player wagering revenue: outside scope, but supporting B2B services to the operator can still be in scope.
How it works
You map each revenue stream to its VAT treatment. For an MGA-licensed B2C operator, the gross wagering revenue from licensed games is exempt — you don't issue VAT invoices to players, you record net player liability. For B2B services you supply (e.g. you white-label your platform to another operator), the supply is taxable: you issue a VAT invoice at 18% to a Maltese buyer, or apply reverse charge if the buyer is VAT-registered in another EU member state.
For inbound B2B services you receive, the reverse charge applies. A SaaS provider in Ireland invoices you without VAT (the Irish provider notes 'Reverse charge — Article 196 of Directive 2006/112/EC'); you self-account for 18% Maltese VAT on the purchase and recover it on the same Malta VAT return as input tax. This is neutral for fully taxable iGaming services but a cash cost for the exempt B2C wagering business.
For affiliate commissions, the affiliate (e.g. a marketing partner who refers players) issues a VAT invoice. If they're Maltese, they charge 18%; if they're in another EU state, they apply reverse charge and you self-account on import. Affiliate fees on exempt B2C gambling revenue are an exempt-related cost, so you don't recover input VAT on them.
For players located outside the EU (e.g. Asian or LATAM markets), the gambling supply is outside the scope of Maltese VAT entirely — you don't even need to report it on Maltese VAT returns under exempt revenue. But supporting B2B services you receive to deliver the game (e.g. EU-based payment processing fees) remain in scope of reverse charge and Malta VAT.
For OSS reporting on cross-border digital supplies that are taxable (e.g. a Maltese platform selling skins, in-game currency or gaming SaaS to consumers in Germany), you register for the OSS Union scheme via CFR Malta and report quarterly. The German consumer is charged 19% German VAT on the digital supply — even though the wagering itself is exempt.
Legal references
- VAT Act, Chapter 406, Fifth Schedule, Item 9 — exemption for betting, gaming and lotteries.
- Gaming Act, Chapter 583 — MGA licensing framework for B2B and B2C operators.
- Council Directive 2006/112/EC, art. 196 — reverse charge for cross-border B2B services.
- CFR Malta Guidelines on the VAT Treatment of Remote Gaming (latest 2023 update).
Frequently asked questions
Is the MGA gaming licence enough to claim the VAT exemption?
The exemption under Item 9 of the Fifth Schedule applies to 'betting, gaming and lotteries' as defined in Maltese law — the MGA licence is strong evidence that you're operating a licensed game of chance, but the legal trigger is the nature of the supply, not the licence itself. White-label arrangements where you operate the platform but the licensed operator is your customer typically don't get the exemption — those are taxable B2B services at 18%, possibly shifted to reverse charge cross-border.
Do I charge VAT on a B2B SaaS fee to a UK-based gaming operator?
No — after Brexit, UK is treated as a third country for VAT purposes. The general B2B place-of-supply rule (art. 44 of Directive 2006/112/EC) puts the place of supply where the customer is established, so the UK is outside the scope of Maltese VAT entirely. You issue an invoice with 'Outside the scope of VAT' or 'Reverse charge — UK domestic rules apply'; the UK buyer self-accounts for UK VAT under their domestic rules.
Can I recover input VAT on legal and audit fees for the gambling business?
Only partially. The legal and audit fees are an overhead cost shared between exempt B2C gambling and taxable B2B services — so you apportion the input VAT using a coefficient based on your turnover mix (taxable / (taxable + exempt)). The coefficient is recalculated annually on your VAT return and the previous year's claim is adjusted. CFR publishes guidance on acceptable apportionment methodologies in the iGaming sector specifically.
What's the VAT treatment of in-game currency and skins?
In-game currency that has no real-world value (purely for use inside the licensed game) is generally treated as part of the exempt gambling supply. In-game items (skins) that can be traded or have monetary value outside the game are taxable at 18% in Malta — or you apply OSS for B2C cross-border sales to other EU consumers. The fact pattern is fragile: CFR has issued informal guidance suggesting case-by-case rulings for new in-game economies.
Do affiliate payments to non-EU partners need any special treatment?
Affiliate fees to non-EU partners (e.g. a US-based marketer) are outside the scope of Maltese VAT — no reverse charge applies because the supplier is established outside the EU and the supply is in their jurisdiction. But you should keep the contract, the affiliate code mapping and the player attribution audit trail, because CFR can challenge whether the substance of the payment matches the form during a routine VAT audit.