Category: Residency

Switzerland is an enchanting country, blessed with spectacular hiking and skiing trails, beautiful rivers and lakes, picturesque villages, Swiss festivals throughout the year, and, of course, the spectacular Swiss Alps. It appears on almost every bucket list of places to visit but has succeeded in not feeling over-commercialised – even with the tourists flocking to the country to try the world-famous Swiss chocolates.

Switzerland features almost at the top of the list of most attractive countries for high-net-worth individuals to live. It is one of the world’s wealthiest countries and is also known for its impartiality and neutrality.

Switzerland offers an exceptionally high standard of living, first-rate health service, outstanding education system, and boasts a plethora of employment opportunities.

Switzerland is also ideally situated for ease of travel; one of the many reasons high-net-worth individuals choose to relocate here. Perfectly situated in the middle of Europe means moving around could not be easier, especially for individuals who regularly travel, internationally.

Swiss Residence

There are no restrictions imposed on permanent residence for EU/EFTA nationals and these individuals enjoy priority access to the labour market. Should an EU/EFTA citizen wish to live and work in Switzerland, they can freely enter the country but will need a work permit to stay more than 3 months.

Regarding EU/EFTA nationals who do not want to work in Switzerland, the process is even more straightforward. Individuals must show they have sufficient funds to live in Switzerland and take out Swiss health and accident insurance.

The process is a bit longer for non-EU and non-EFTA (European Union Free Trade Association) nationals. Those who wish to live and work in Switzerland are allowed to enter the Swiss labour market, but must be appropriately qualified (such as managers, specialists, and those with higher education qualifications). They will also need to be registered with the Swiss authorities in order to obtain a work visa, and they will need to apply for an entry visa from their home country.

Non-EU/EFTA nationals who want to move to Switzerland, but not to work, are divided into two age categories. Depending on which category the individual falls into (over 55 or under 55), certain criteria must be met (more information can be provided on request: advice.switzerland@dixcart.com).

Taxation in Switzerland

One of the greatest motivations for moving to Switzerland is the attractive tax regime available to individuals who choose to live there. Switzerland is divided into 26 cantons and each canton has its own cantonal and federal taxes that generally impose the following taxes: income, net wealth, and real estate.

A significant advantage of the Swiss tax regime is that the transfer of assets in Switzerland, before death (as a gift), or on death, to a spouse, or to children and/or grandchildren is exempt from gift and inheritance tax, in most cantons. In addition, capital gains are generally also tax free, except in the case of real estate.

The federal and cantonal tax laws of most cantons provide for a special Lump Sum Tax Regime for foreigners who move to Switzerland for the first time, or after an absence of ten years, and who will not be employed or commercially active in Switzerland. It is an extremely attractive tax regime as it enables individuals to manage their worldwide investments from Switzerland.

Individuals benefiting from the Lump Sum System of Taxation are not subject to Swiss taxation on their worldwide income and net wealth, but on their worldwide expenditure (living expenses). The minimum requirement for calculating income tax based on expenses for individuals with their own household, is the equivalent of seven times the annual rental value of their principle residence in Switzerland. In addition, a minimum taxable income of CHF 400,000 is assumed for direct federal taxation. Cantons may also define minimum expense thresholds, but the amount is at their own discretion. Some cantons have already stated their minimum threshold amounts and these will vary from canton to canton.

Living in Switzerland

Although Switzerland has a variety of beautiful towns and alpine villages to live in, expats and high-net-worth individuals are mainly drawn to a few specific cities. At a glance, these are Zürich, Geneva, Bern and Lugano.

Geneva and Zürich are the biggest cities due to their popularity as centres for international business and finance. Lugano is located in Ticino, the third most popular canton, as it is close to Italy and has a Mediterranean culture many expats enjoy.

Geneva

Geneva is known as the ‘international city’ in Switzerland. This is due to the high number of expats, the UN, banks, commodity companies, private wealth companies, as well as other international companies. Many businesses have set up head offices in Geneva. However, the main attraction for individuals, continues to be the fact that it is in the French part of the country, has a well-looked-after old town full of history and culture and boasts Lake Geneva, with a magnificent water fountain which reaches 140 meters into the air.

Geneva also has fantastic connections to the rest of the world, with a large international airport and connections to the Swiss and French rail and motorway systems.

In the winter months, residents in Geneva also have very easy access to the Alp’s best ski resorts.

Zürich

Zürich is not the capital of Switzerland, but it is the largest city, with 1.3 million people within the canton; an estimated 30% of the residents in Zürich are foreign nationals. Zürich is known as the Swiss financial capital and is home to many international businesses, especially banks. Even though it gives the image of high-rise buildings and a city lifestyle, Zürich has a beautiful and historical old town, and an abundance of museums, art galleries and restaurants.  Of course, you are also never too far from the lakes, hiking trails and ski slopes if you love being outdoors.

Lugano and the Canton of Ticino

The canton of Ticino is the southernmost canton of Switzerland and borders the canton of Uri to the north. The Italian-speaking region of Ticino is popular for its flair (due to its proximity to Italy) and fantastic weather.

Residents enjoy a snowy winter but in the summer months, Ticino opens its doors to tourists who flood to its sunny coastal resorts, rivers and lakes, or sun themselves in the town squares and piazzas.

In Switzerland, four different languages are spoken, and English is well spoken everywhere.

Additional Information

I hope this article has inspired you to visit Switzerland and to consider this incredible country as a place of residence. No matter which canton draws your attention, or which city you decide to settle in, the rest of the country, and Europe, is easily accessible. It may be a small country, but it offers; a diverse range of places to live, a dynamic mix of nationalities, is headquarters to many international businesses, and caters to a large range of sports and leisure interests.

The Dixcart office in Switzerland can provide a detailed understanding of the Swiss Lump Sum System of Taxation, the obligations that need to be met by applicants and the fees involved. We can also give a local perspective on the country, its people, the lifestyle, and any tax issues. If you would like to visit Switzerland, or wish to discuss moving to Switzerland, please do get in touch: advice.switzerland@dixcart.com.

The procedure for relocating to Switzerland is made easier for both EU/EFTA nationals and non-EU/EFTA nationals, if the new resident forms a Swiss company and is employed by it.

If you are looking for a high quality of life in one of the world’s most economically and politically stable countries, living in Switzerland could provide you with the ideal answer. Not only will you find yourself at a central hub for travel to over 200 international locations, but you will also have access to the beautiful scenery of the Alps and picturesque lakes.

There are two options for moving to Switzerland – but the main question is do you wish to work once you have moved?

This article explores the following:

1. Why Switzerland?
2. Who Can Move to Switzerland?
3. Forming or Investing in a Swiss Company
4. Criteria for Forming a Swiss Company
5. How to Invest in a Swiss Company?
6. Benefits – Tax and Residence
7. Living in Switzerland

1. Why Switzerland?

Switzerland is an attractive jurisdiction to start and operate a business, as a location for individuals and for family protection and safety. 

Advantages include:

• Located in the centre of Europe.
• Economic and political stability.
• High regard for personal privacy and confidentiality.
• Most ‘innovative’ and “competitive” country in the world with various strong industries.
• A well-respected jurisdiction with an excellent reputation.
• A high quality and multilingual local workforce.
• Low rates of corporate tax for Swiss companies.
• Premier destination for international investment and asset protection.
• Major commodity trading centre in the world.
• Hub for HNWIs, international families and a wide variety of professionals including lawyers, family offices, bankers, accountants, insurance companies.

2. Who can Move to Switzerland?

• EU/EFTA nationals: enjoy priority access to the labour market. They can freely enter the country but will require a work permit. The individual will need to find a job and the employer must register the employment before the individual can actually start to work.
• Non-EU/EFTA nationals: are allowed to enter the Swiss labour market if they are appropriately qualified, for example managers, specialists, and those with higher educational qualifications. The employer needs to apply to the Swiss authorities for a work visa, while the employee applies for an entry visa from their home country. The work visa will allow the individual to live and work in Switzerland.

3. Forming or Investing in a Swiss Company and Becoming a Director or an Employee of the Company

The establishment of a Swiss company is one of the most popular routes for individuals relocating to Switzerland. This is because EU/EFTA and non-EU/EFTA nationals can form a Swiss company, be employed by it, reside in Switzerland, and benefit from the attractive tax regime.

Any foreign national can form a company and therefore potentially create jobs for Swiss nationals. The owner of the company is eligible for a residence permit in Switzerland, as long as he/she is employed by the company in a senior capacity.

4. What are the Criteria?

In principle, non-EU/EFTA nationals need to form a company which must:

• generate an annual minimum turnover of CHF 1 million, and
• create new jobs exploiting new technologies and/or the development of the region and contribute to the economic development of the country.

The company must produce a business plan detailing how the amount to be invested will generate a turnover of CHF 1million or more per annum, in the ‘near’ future. The business plan also needs to show that the company will achieve this turnover in a specified number of months, not necessarily in the first year, particularly if the company is a start-up.

The types of economic development objectives for the company, which are regarded positively in Switzerland, include: opening up new markets, securing export sales, establishing economically significant links abroad, and the creation of new tax revenue. Precise requirements vary by canton and more information can be provided on request.

Alternatively…

5. Investment in a Swiss Company

Alternatively, EU and non-EU/EFTA applicants can choose to invest in a company which is struggling to expand, as it lacks the necessary funding.

For non-EU/EFTA applicants this new funding should then enable the company to create jobs and assist the Swiss economy to expand. The investment must add economic value to a particular Swiss region.

6. Benefits of a Swiss Company – Tax and Residence

• Taxation of Swiss Companies

Swiss companies can enjoy a zero-tax rate for capital gains and dividend income, depending on the circumstances, and Trading companies are taxed as follows:

• The effective cantonal and federal corporate income tax rate (CIT) is between 12% and 14% in most cantons. The Geneva corporate tax rate is 13.99%.

Swiss Holding Companies benefit from a participation exemption and do not pay tax on profits or capital gains arising from qualifying participations. This means that a pure Holding Company is exempt from Swiss tax.

Withholding Tax (WHT)

• There is no WHT on dividend distributions to shareholders based in Switzerland and/or in the EU (due to the EU Parent/Subsidiary Directive).
• If shareholders are domiciled outside Switzerland and outside of the EU, and a double tax treaty applies, the final taxation on distributions is generally between 5% and 15%.

Double Tax Treaties

Switzerland has an extensive double tax treaty network, with access to tax treaties with over 100 countries.

For more information about Swiss Companies, please read our article: Formation of a Swiss Company.

• Taxation of Individuals

Each canton sets its own tax rates and generally imposes the following taxes: income, net wealth, real estate, inheritance, and gift tax. The specific tax rate varies by canton and is between 21% and 46%.

In Switzerland, the transfer of assets, on death, to a spouse, children and/or grandchildren is exempt from gift and inheritance tax, in most cantons.

Capital gains are generally tax free, except in the case of real estate. The sale of company shares is one of the assets, that is exempt from capital gains tax.

7. Living in Switzerland

Switzerland ranks among the top countries in the world in which to live due to its high quality of living and reputation as a centre of international trade and finance. It is one of the world’s wealthiest countries and is also known for its impartiality and neutrality.

Switzerland is blessed with spectacular hiking and skiing trails, exclusive swimming spots in the many rivers and lakes, picturesque villages, Swiss festivals throughout the year, and, of course, the Swiss Alps which look spectacular during any season.

Switzerland offers an exceptionally high standard of living, first-rate health service, outstanding education system, and boasts a plethora of employment opportunities.

Switzerland is one of 26 countries in the ‘Schengen’ area and a Swiss residence permit will enable you to enjoy full Schengen travel rights. It is therefore ideally situated for ease of travel; one of the many reasons high-net-worth individuals choose to relocate here. Perfectly situated in the middle of Europe means moving around could not be easier, especially for individuals who regularly travel, internationally.

Although Switzerland has a variety of beautiful towns and alpine villages to live in, high-net-worth individuals are mainly drawn to a few specific cities. At a glance, these are Zürich, Geneva, Bern, and Lugano. Geneva and Zürich are the biggest cities due to their popularity as centres for international business and finance. Ticino is the third most popular canton, as it is located close to Italy and has a Mediterranean culture.

Additional Information

If you would like additional information regarding moving to Switzerland and forming a Swiss Company, please contact Christine Breitler at the Dixcart office in Switzerland: advice.switzerland@dixcart.com.

Non-Swiss nationals are allowed to stay in Switzerland as tourists, without registration, for up to three months. After three months, anyone planning to stay in Switzerland must obtain a work and/or residence permit, and formally register with the Swiss authorities.

How can I Become a Legal Swiss Resident?

There are two alternative routes to become a Swiss resident:

• By working in Switzerland
• By not working in Switzerland and/or by being retired
  • The ‘Normal System of Taxation’
  • The ‘Lump Sum System of Taxation’

Working in Switzerland

The acquisition of a Swiss work permit allows a non-Swiss national to become a Swiss resident.

There are three ways to be entitled to work in Switzerland:

• Being hired by an existing Swiss company.
• Forming a Swiss company and become a director or an employee of the company.
• Investing in a Swiss company and become a director or an employee of the company.

When applying to work in Switzerland and/or for residence permits, different regulations apply to EU/EFTA nationals, compared to nationals of other countries.

• It is a straightforward process for EU/EFTA citizens as they enjoy priority access to the labour market in Switzerland.
• Non-EU/EFTA nationals can work in Switzerland as long as they are appropriately qualified, for example managers or specialists and/or with higher education qualifications.

An alternative route is for non-Swiss nationals to form a Swiss company and obtain a residence permit in Switzerland. Relevant individuals must be employed by the company that they establish in Switzerland.

Non-EU/EFTA businesses need to create jobs and business opportunities in Switzerland. The precise number and nature varies depending on the particular canton in which the business is located.

Normal System of Taxation – Not working in Switzerland

The process is relatively straightforward for EU/EFTA nationals wanting to live, but not work, in Switzerland and taxed via normal system of taxation.

Individuals must have sufficient financial resources to live in Switzerland and ensure that they will not become dependent on Swiss welfare and they also need to take have Swiss health and accident insurance

For Non-EU/EFTA nationals the process is less straightforward but is achievable, under the correct circumstances.

Lump Sum Taxation – Not working in Switzerland

A non-Swiss national, who does not work in Switzerland, can apply for Swiss residency under the system of ‘Lump Sum Taxation’.

• The taxpayer’s lifestyle expenses are used as a tax base instead of his/her global income and wealth. There is no reporting of global earnings and assets.

Once the tax base has been determined and agreed with the tax authorities, it will be subject to the standard tax rate relevant in that particular canton.

Work activities outside Switzerland are permitted. Activities relating to the administration of private assets in Switzerland can also be undertaken.

Third country nationals (non-EU/EFTA), may be required to pay a higher lump-sum tax on the basis of “predominant cantonal interest”. This will depend on a number of factors and varies case by case.

How can an Individual Become a Swiss Citizen?

• An EU or non-EU/EFTA national must have lived in Switzerland for at least 10 years, to be able to apply for a Swiss passport.
• If an EU or non-EU/EFTA national is the spouse of a Swiss national, they need only to have lived in Switzerland for 5 years.

What Advice and Support can Dixcart in Switzerland Provide?

Dixcart in Switzerland is experienced in assisting individuals to move to this country having assisted:

• Individuals working for Swiss companies
• Individuals seeking to establish a Swiss company
• Individuals based in or moving to Switzerland and working for foreign companies
• Foreign companies looking to set up a Swiss branch or companies
• Those seeking to take advantage of the Lump Sum System of Taxation

Professional support includes guidance regarding:

• Choice of location to move to in Switzerland: canton and city.
• Lump Sum Taxation: the criteria, how to apply for it, the taxation implications for the specific circumstances (dependent on the canton where the individual chooses to live). 
• For employees, assistance regarding: salary calculations, social security calculations and payments, and payroll tax calculations and payments.
• For those seeking to set up a business: bookkeeping, business plans, payroll, preparation of annual accounts, preparation of annual returns, Swiss insurance expertise, Swiss social security expertise, and value added tax reporting and payment (VAT).

Additional Information

If you would like additional information regarding moving to Switzerland and the assistance that Dixcart Switzerland can provide, please contact Christine Breitler at the Dixcart office in Switzerland: advice.switzerland@dixcart.com.

Background

As of 6th April 2022  a number of new UK immigration rules came into effect.

The Tier 1 (investor) visa had already been closed to new applicants on 17 February 2022.

A summary of the key changes is detailed below.

Overseas Representatives Business Category

The Overseas Representative Businessperson category, commonly known as Sole Representative will no longer exist. The Overseas Media Person category will remain unaffected. Those currently holding permission under the Sole Representative category will be unaffected.

Global Business Mobility Routes

The Intra-Company Transfer routes have been revamped and will be known as the Global Business Mobility routes. Those under this category will not be eligible for permanent residence.

The new Global Business Mobility route creates 5 sub-categories as set out below. It means that a sponsor licence holder will need to hold licences under the relevant sub-categories to be able to be a sponsor:

1. The Senior or Specialist Worker which replaces the Intra-Company route and is applicable to senior managers or specialist employees who are being assigned to a UK linked entity for a temporary assignment.
2. Graduate Trainee which replaces the Graduate Trainee Intra-Company route and is designed for those on a dedicated Graduate programme outside of the UK, and who are required to be assigned to the UK for part of the programme.
3. UK Expansion Worker which is for senior managers or specialist workers being assigned temporarily to the UK to establish an UK entity or to undertake work related to a business expansion to the UK. The applicant would need to meet the points criteria (60 points) and be granted a Certificate of Sponsorship. This will mean that the employer must obtain a sponsor licence by requesting a provisional rating, with the applicant holding the role of authorising officer. The maximum stay allowed would be 5 years in any 6-year period.
4. Service Supplier which is for overseas workers who are undertaking temporary work assignments in the UK, where the worker is either a contractual service supplier employee or a self-employed independent professional. The applicant would need to meet the points criteria (40 points) and be granted a Certificate of Sponsorship. There are no requirements to meet the salary point requirements. The maximum stay allowed would be 5 years in any 6-year period.
5. Secondment Worker which is for overseas workers who are undertaking temporary work assignments, where the assignment is part of a high value contract or investment by their overseas employer. The applicant would need to meet the points criteria (40 points) and be granted a Certificate of Sponsorship. There are no requirements to meet the salary point requirements, but the contract must have been registered with the Home Office. The maximum stay allowed would be 5 years in any 6-year period.

Introduction of the High Potential Individual (HPI) and Scale-up Routes

The HPI introduces an elite points-based route to attract the brightest and best to the UK to maintain the UK’s status as a leading international hub for emerging technologies. Applicants must have a bachelor’s or postgraduate degree from one of the Global Universities, listed by the Home Office, within 5 years of the date of application.

The Scale-up route introduces an elite points-based route to attract the brightest and best to the UK, to maintain our status as a leading international hub for emerging technologies. A job offer must be received from an authorised UK scale-up company. The scale-up company would need to demonstrate that they have an annualised growth of at least 20% for the previous 3-year period in terms of turnover or staffing, as well as having a minimum of 10 employees at the start of the 3-year period.

Additional Changes

Changes have been made to the rules relating to Settlement based on Family Life and Private Life, to make the requirements simpler to understand.

Policy Guidance

A further update will be provided once the policy guidance has been released.

Further Information and Advice

If any of the changes above affect you and/or you need assistance regarding immigration to the UK, as an individual or as an employer, please speak to Peter Robertson at: advice.uk@dixcart.com.

Digital Nomads – the Background

Digital nomads are remote workers who travel to different locations regularly. They use modern technology to work from coffee shops, hotels, co-working spaces, or libraries with a Wi-Fi-connected laptop or smartphone from anywhere in the world.

Digital nomads tend to be freelancers or entrepreneurs who are self-employed, working for themselves or for companies as independent contractors.

In the past it has been difficult for entrepreneurs and freelancers to apply for traditional visas as either a contract with a local entity was required, or a letter of invitation. A tourist visa, for example, is not suitable as the individual might want to stay for a more extended period.

The Malta Nomad Residence Permit

The Malta Nomad Residence Permit can easily be obtained by; remote workers, digital nomads, and freelancers and it grants the holder a legal right to reside in Malta and travel visa free throughout the Schengen Member States.

About Malta

Malta has long been famous for its expat-friendly environment, which is well illustrated by the large expat community in Malta. Thanks to its favourable legislative system and tax benefits, the island is home to many foreign companies.

It is a small country in size but has a cosmopolitan soul. There are many cafes, bars, restaurants, and co-working spaces that make life easier for digital nomads. In addition, it is now one of the very few countries in the world with 5G nationwide coverage.

Along with its digital nomad-friendly environment, it also has everything an ideal island would have; beaches, 300 sunny days a year, a relaxed way of life, excellent seafood, and a lot of fun. Malta has it all and is a perfect base for remote working.

Eligibility Criteria for Malta Nomad Residence Permit

There is a specific set of rules for the program.

Applicants must:

• Be a third-country national (non-EU)
• Have a monthly income of €3,500 (gross of tax) for a single applicant
• Have a work contract for an employer that is registered in a country other than Malta, OR
• Be a partner/shareholder in a company that is registered in a country other than Malta, OR
• Offer freelance services to clients whose permanent establishments are in  countries other than Malta, and with whom the applicant has a contract(s)
• Have a valid travel document
• Have health insurance covering Malta
• Present a property rental or property purchase agreement

Cost of Application and Timeframe for Malta Nomad Residence Permit

The government fee for the main applicant is €300, with an additional €300 fee payable for each family applicant.

Applicants who intend to spend up to 180 days in Malta will be issued with a National Visa, while those who plan to spend up to 365 days or more will be issued with a Residence Permit.

Processing applications takes approximately 30 days, from receipt of all the required documentation and application forms.

Which Family Members can be Included?

The main applicant can include dependent family members. It is possible to add a spouse and minor children, as well as adults who are financially dependent on the main applicant.

Malta recognizes same-sex unions. A same-sex partner in a committed relationship for a defined period, can be included in an application.

Applicable Taxes

Nomad residence permit holders are not subject to personal income tax as they are  expected to pay tax in their country of origin. However, nomad residence permit holders will be subject to consumption tax (VAT) in the same manner as all Malta residents. 

How Can Dixcart Assist?

If you would like further information regarding Malta Nomad Residence Permit, please speak to Jonathan Vassallo: advice.malta@dixcart.com, at the Dixcart office in Malta or to your usual Dixcart contact.

Dixcart Management Malta Limited Licence Number: AKM-DIXC

There are several residence options available in Malta aimed at non-EU/EEA nationals to obtain residence status in Malta. The various routes range from those intended to obtain a permanent residence status to programmes giving a special tax and temporary residence status.

In Malta the two most popular residency routes are the Malta Permanent Residence Programme (MPRP) and the Malta Global Residence Programme (GRP).

Malta Permanent Residence Programme (MPRP)

The MPRP is open to all third-country, non-EEA and non-Swiss nationals, with a stable income from outside Malta sufficient to maintain themselves and their dependants with adequate financial resources. 

Once applicants have successfully completed the application process with Malta Residence Agency, they receive an e-Residence card that entitles them to live in Malta and travel visa-free throughout the Schengen Member States. More information about the MPRP programme can be found here: Malta Permanent Residence Programme.

Malta Global Residence Programme (GRP) 

GRP is available to non-EU passport holders. The Global Residence Programme entitles non-EU nationals to obtain a Maltese residence permit, renewable annually, through a minimum investment in property in Malta and by paying a minimum annual tax. Individuals who are EU/EEA/Swiss nationals please see: Malta Global Residence Programme which operate on the same basis as the GRP.

The Main Difference

The main difference between the Global Residence Programme (GRP) and Malta Permanent Residence Programme (MPRP), is that the GRP does not offer permanent residence rights. A special tax status leads to an annual residency permit, whilst the MPRP offers permanent residence in Malta. 

Residence Status Explained

Residence status obtained under the MPRP is valid for life (provided that the requirements of the programme are still being met), whilst the residence status obtained under the GRP is renewed annually subject to paying an annual tax.

Annual Tax:

• Under the GRP, a beneficiary must pay a minimum annual tax of €15,000.

• Under the MPRP, there is a minimum annual tax of €5,000 if the person is ordinarily resident in Malta, or zero tax if the person is not ordinarily resident in Malta. In both cases the tax rate on income remitted to Malta is a flat 35%.

Comparison of Programs: GRP and MRVP 

Conditions	Global Residence Programme	Malta Permanent Residence Programme
Financial requirements	Not specifically defined, but an individual should have sufficient resources to sustain him or herself and dependants, without any recourse to social assistance in Malta.	No less than €500,000 in all assets (€150,000 of which should be in financial assets – for the first 5 years).
I. Option. Purchase a property with a minimum value of	Central/North Malta: €275,000 South Malta/Gozo: €220,000	Central/North Malta: €350,000 South Malta/Gozo: €300,000
II. Option. Rent a property with a minimum value	Central/North Malta: €9,600 South Malta/Gozo: €8,750	Central/North Malta: €12,000 South Malta/Gozo: €10,000
Minimum annual tax	€15,000 per year	From €5,000 per year, if ordinarily resident **
Tax rate	15%: Foreign Source Income remitted to Malta 35%: Local Source Income	If ordinarily resident: 0% – 35%**
Registration procedure	Application Fee + Property + Annual Tax	Application Fee + Contribution + Property + Charity
Application process	3-6 months	4-6 months
Official application fee	€6,000	1. Application Fee: €10,000 due within one month of submission 2. Letter of Approval: €30,000 due within two months of submission 3. 8 months to conclude the due diligence and a contribution of: €28,000 or €58,000 needs to be paid
Dependants	Spouse, Children up to 18 or adult children between 18 and 25 years old, including adopted children, provided that such children are not economically active and are financially dependent on the main applicant. Financially dependent parents.	Allowing 4 generations to be included in one application: spouse, children – regardless of age can be included in the application if they are unmarried and financially dependent, parents and grandparents if they are principally and financially dependent on the main applicant.
Donation to a Non-Government Organisation	Not applicable	€2,000
Additional Criteria	Applicant must not spend more than 183 days in any other jurisdiction in any single calendar year.	An additional €7,500 payment per person is required for each adult dependant included in the application.
Duration of status in Malta	One calendar year. Need to re-submit on an annual basis.	Permanent Status: a Malta residence card is issued for all family members for 5 years, then renewed without any additional contribution, if the requirements of the programme continue to be met.
Schengen Access (26 European countries)	Right to travel within the Schengen Area for 90 days in any 180 days.	Right to travel within the Schengen Area for 90 days in any 180 days

** Annual minimum tax under the Permanent Residence Programme is zero if you are not ordinarily resident in Malta. If you select to be ordinarily resident in Malta, then the annual minimum tax is €5,000.

How Can Dixcart Help?

Any individual interested in applying for one of these residency routes is required to do so through a registered approved agent.

Dixcart is an authorised agent and offers a bespoke service. We will be by your side throughout the process from completing the required documents to meetings with the various Maltese Authorities.  We can support you in choosing the best residential option in Malta for you and your family.

Additional Information

If you would like further information regarding MPRP or GRP in Malta, please speak to Jonathan Vassallo: advice.malta@dixcart.com, at the Dixcart office in Malta or to your usual Dixcart contact.

Dixcart Management Malta Limited Licence Number: AKM-DIXC

Background

The island of Guernsey is the second largest of the Channel Islands, which are situated in the English Channel close to the French coast of Normandy. The Bailiwick of Guernsey comprises three separate jurisdictions: Guernsey, Alderney and Sark. Guernsey is the largest and most populated island in the Bailiwick. Guernsey combines many of the reassuring elements of UK culture with the benefits of living abroad.

Guernsey is independent from the UK and has its own democratically elected parliament which controls the island’s laws, budget and levels of taxation. Legislative and fiscal independence mean that the island can respond quickly to the needs of business. In addition, the continuity achieved through the democratically elected parliament, without political parties, helps deliver political and economic stability. 

Guernsey – a Tax Efficient Jurisdiction

Guernsey is a leading international financial centre with a good reputation and excellent standards:

• The general rate of tax payable by Guernsey companies is zero*.
• There is no capital gains tax, inheritance tax, value added tax or withholding tax.
• Income tax is generally a flat rate of 20%.

*Generally, the rate of corporation tax payable by a Guernsey company is 0%.

There are certain limited exceptions when a 10% or 20% rate of tax apply. Please contact the Dixcart office in Guernsey, for further details: advice.guernsey@dixcart.com.

Tax Residence and a Significant Tax Advantage 

An individual who is resident, but not solely or principally resident in Guernsey, can elect to be taxed on Guernsey source income only, subject to a minimum charge of £40,000. In this instance any additional income earned outside Guernsey will not be taxed in Guernsey.

Alternatively, an individual who is resident, but not solely or principally resident in Guernsey, can elect to be taxed on his or her worldwide income.

Special provisions are available for those who are resident in Guernsey solely for employment purposes.

For Guernsey income tax purposes an individual is ‘resident’, ‘solely resident’ or ‘principally resident’ in Guernsey. The definitions relate primarily to the number of days spent in Guernsey during a tax year and, in many cases, also relate to the days spent in Guernsey in several preceding years.

Precise definitions and current tax rates and allowances are available on request. 

Attractive Tax Cap for Individuals 

Guernsey has its own system of taxation for residents. Individuals have a tax-free allowance of £13,025. Income tax is levied on income in excess of this amount at a rate of 20%, with generous allowances.

‘Principally resident’ and ‘Solely resident’ individuals are liable to Guernsey income tax on their worldwide income.

‘Resident only’ individuals are taxed on their worldwide income or they can elect to be taxed on their Guernsey source income only and pay a standard annual charge of £40,000.

Guernsey residents falling under one of the three residence categories above can pay 20% tax on Guernsey source income and cap the liability on non-Guernsey source income at a maximum of £150,000 OR cap the liability on worldwide income at a maximum £300,000.

New residents to Guernsey, who purchase an ‘open market’ property, can enjoy a tax cap of £50,000 per annum on Guernsey source income in the year of arrival and subsequent three years, as long as the amount of Document Duty paid, in relation to the house purchase, is at least £50,000.

The island offers attractive tax caps on the amount of income tax payable by residents and has:

• No capital gains taxes
• No wealth taxes
• No inheritance, estate or gift taxes
• No VAT or sales taxes

Immigration to Guernsey

The following individuals do not generally need permission from the Guernsey Border Agency to move to the Bailiwick of Guernsey:

• British citizens.
• Other nationals of Member States of the European Economic Area and Switzerland.
• Other nationals who have permanent settlement (such as indefinite leave to enter or remain in the Bailiwick of Guernsey, United Kingdom, Bailiwick of Jersey or the Isle of Man) within the terms of the Immigration Act 1971.

An individual who does not have an automatic right to live in Guernsey must fall within one of the categories below:

• Spouse/partner of a British citizen, EEA national or settled person.
• Investor
• Person intending to set themselves up in business.
• Writer, artist or composer.

Any other individual wishing to move to the Bailiwick of Guernsey must obtain an entry clearance (visa) prior to his/her arrival.  The entry clearance must be applied for through the British Consular representative in the individual’s country of residence. The initial process generally starts with an online application via the British Home Office website.

Property in Guernsey

Guernsey operates a two tier property market. Individuals who are not from Guernsey can only live in open market property (unless they have a work licence), which is generally more expensive than local market property.

What Other Advantages Does Guernsey Offer?

• Location

The island is situated approximately 70 miles from the south coast of England and a short distance from the north-west coast of France. It has 24 square miles of beautiful countryside, a stunning coastline and a mild climate, courtesy of the Gulf Stream.

• Economy

Guernsey has a stable and diverse economy:

• Low tax regime which is compliant with international standards
• AA+ credit rating
• World class professional services with a global network
• A pro-business attitude with easy access to government decision makers
• Frequent connections to London airports
• Part of the sterling zone
• Mature legal system 

• Quality of Life

Guernsey is renowned for its relaxed, high quality standard of living and a favourable work-life balance. The following benefits are available:

• A wide range of attractive residential properties to choose from
• A safe and stable place to live
• High-powered “city” jobs without the downsides of commuting or inner city living
• First rate education system and quality health care
• Peter Port, one of Europe’s most attractive harbour towns
• Breath-taking beaches, stunning cliff coastline and idyllic countryside
• High quality restaurants
• The natural resources of the island enable a variety of recreational and sporting activities
• A strong sense of community with a charitable spirit

• Transport Links

The island is only forty-five minutes from London by air and has excellent transport links to the seven key UK airports, which enables easy access to European and international connections. 

What Does Sark Offer?

In addition to Guernsey, the island of Sark falls within the Bailiwick of Guernsey. Sark is a small island (2.10 square miles) with a population of approximately 600 and has no motorised transport.

Sark offers a very relaxed lifestyle and a simple and low tax system. Personal tax per adult resident, for example, is capped at £9,000.

There are laws which restrict the occupation of certain dwellings. 

Further Information

For further information on relocation to Guernsey please contact the Dixcart office in  Guernsey: advice.guernsey@dixcart.com. Alternatively, please speak to your usual Dixcart contact.

Dixcart Trust Corporation Limited, Guernsey: Full Fiduciary Licence granted by the Guernsey Financial Services Commission.

 

Guernsey registered company number: 6512.

The New Permanent Residence Programme came into effect at the end of March 2021.

What are the Key Defining Features of the Malta Permanent Residence Programme?

The Malta Permanent Residence Programme (MPRP) is open to all third country, non-EEA, and non-Swiss nationals, with sufficient financial resources.  

Once the application process has been successfully completed by ‘Residency Malta Agency’, applicants receive permanent residency immediately and an ‘eResidence’ card, that entitles them to live in Malta and to travel visa free throughout the Schengen Member States.

Features that set the MPRP apart from other programmes, include:

• There is no need to learn Maltese as there is no language test to obtain Permanent Residence.
• English is an official language in Malta so all documents and government interactions will be in English.
• Permanent Residence is granted on successful completion of the application
• There are no minimum days to be spent in Malta.
• Children, regardless of age, can be included in the application, as long as they are unmarried and principally dependant on the main applicant.
• Dependant parents and grandparents may also be included in the application, effectively allowing 4 generations to be included in one application.
• Children born or adopted by the main applicant after the application approval date can also be included.

Requirements

An individual will need to make an investment consisting of the following:

• Physical Address in Malta
  • Purchase a property with a minimum value of €350,000, reduced to €300,000 if the property is situated in the South of Malta or Gozo, or
  • Rent a property, with a minimum rental cost of €12,000 per annum, reduced to €10,000 per annum if the property is situated in the neighbouring island Gozo or in the South of Malta.

AND

• Pay the non-refundable administration fee of €40,000

AND

• Make one-off Government contributions, as follows:
  • €58,000 – if the applicant rents a property, or
  • €28,000 – if the applicant buys a qualifying property and
  • An extra €7,500 per additional adult dependant (where applicable). This applies whether the applicant is buying or renting a property.

AND

• Donate a minimum amount of €2,000 to an NGO.

Payment timeframe:

• Initial Administration fee of €10,000
  • Due within one month of the application submission
  • Letter of approval, remainder of the Administration fee of €30,000
    • Due within two months of the application submission
  • 8 months to provide all due diligence and the payment of the Government contribution of either €28,000 or €58,000, to be paid.

The main applicant should have at least €500,000 of net assets in order to qualify for the programme, and €150,000 of the €500,000 must consist of financial assets. The financial assets, however, only have to be maintained for the first 5 years. The capital requirement of €500,000 will remain in force for as long as the individual wishes to remain on the programme.

Finally, health insurance only needs to cover Malta, not all EU countries. This may result in an annual reduction in the insurance premium.

How Dixcart Can Help?

Individuals interested in applying for the MPRP programme must do so through a registered approved agent. Dixcart is an approved agent, and offers a bespoke service to guide clients, every step of the way, through the MPRP process.

Additional Information

If you would like further information regarding MRVP in Malta, please speak to Jonathan Vassallo: advice.malta@dixcart.com, at the Dixcart office in Malta or to your usual Dixcart contact.

Dixcart Management Malta Limited Licence Number: AKM-DIXC

The UK offers several popular visa options for entrepreneurs and businesses based outside the UK, who are looking to set-up and run a business in the UK.

The Sole Rep Visa Category – Key Points

The Sole Rep visa allows an overseas parent company to send a senior employee to the UK to establish its first UK branch or wholly owned subsidiary. To be eligible, some of the key requirements to be met include:

• the main applicant cannot have a majority stake, own or control the overseas business under any arrangement – this also applies to the main applicant’s dependent partner (if also applying)
• only genuine applicants can apply
• the overseas parent company will need to continue to have its headquarters and principal place of business outside the UK
• both the overseas parent company and the intended UK branch or wholly-owned subsidiary must be actively trading in the same type of business
• the applicant needs to have the skills, experience and knowledge of the business necessary to undertake the role and have full authority to negotiate and take the operational decisions on behalf of the business
• the applicant will not engage in business of their own nor represent any other business’ interest in the UK

A Snapshot of the Start-up and Innovator Visa Categories

The Start-up and Innovator visas (which replaced the former Tier 1 (Entrepreneur) visa category on 29 March 2019), allows entrepreneurial applicants, who have had their business idea assessed and approved by an endorsing body as being innovative, viable, and scalable, to set-up and run their business or businesses in the UK. Some of the key requirements include:

• applicants must be the sole founder or an instrumental member of the founding team, relying on their own business plan, and responsible for executing the plan
• an Innovator visa applicant’s business, may have already started trading, but the applicant must be the sole founder or an instrumental member of the founding team
• the “viability” criteria requires the applicant’s business plan to be realistic and achievable based on the applicant’s available resources
• those applying for an Innovator visa must have initial capital of £50,000

Permanent Settlement in the UK

Although the Start-up visa does not permit applicants to apply for permanent settlement, the Innovator visa does allow this option after 3 years. Similarly, the Sole Rep category is a route to permanent settlement, but after 5 years.

Are There Any Other Changes on the Horizon?

A number of new visa announcements were made in the UK Budget of March 2021, to encourage investment into, and growth for business – particularly in the fields of academia, science, research and technology. These include:

• the introduction of an elite points-based visa by March 2022
• the launch of the new Global Business Mobility visa category (which may be a replacement of the Sole Rep route) by spring 2022 for overseas businesses to establish a presence or transfer staff to the UK

Summary

The above is a general overview of some of the popular options and key requirements. If you have any questions and/or would like tailored advice on any UK immigration matter, please speak to Dixcart Legal at: advice.uk@dixcart.com or to your usual Dixcart contact.

When people talk about moving to the UK, many people want to apply for “permanent residence” at the start of their UK immigration journey. In most cases, this is not possible – an application for settlement or indefinite leave to enter/remain usually requires a minimum residence period in the UK of between 2 and 5 years depending on the visa category.

The Importance of the Visa Category Selected

It is very important to choose an appropriate visa category which allows you to do what you want to do in the UK, as well as eventually being able to apply for settlement (if that is an objective).

For instance, both the Skilled Worker and Intra-Company Transfer categories allow individuals to work in the UK; however, only individuals in the Skilled Worker route will be eligible to apply for settlement after 5 years, if they meet all the requirements.

An important requirement is that employers continue to hold a valid sponsor licence. Organisations will be aware that a sponsor licence is valid for 4 years, and they will have diarised to renew their sponsor licence. Without a valid sponsor licence, the individual will not be eligible to apply for indefinite leave to remain, and may be unlawfully working.

Absences from the UK

Another vital requirement, not just in the Skilled Worker category but for most routes eligible for settlement, is that individuals cannot be absent from the UK for more than 180 days in any rolling 12 month period, during the minimum residence period. There are exceptions which might apply, and some visa categories even allow specific work-related absences to be discounted from the “180 day rule”.

It is also not just the responsibility of Skilled Worker migrants to keep a track of their absences, but sponsors also have a duty to keep a record. In reality, many employers and HR staff already keep a record in the personnel files for each member of staff. In addition, employers are required to confirm in writing to the Home Office, that the individual is still required for work for the foreseeable future, and will be paid the minimum salary.

Are there Visa Categories Where the Minimum Residence Period is Less Than 5 Years?

There are a number of visa categories that allow individuals to apply for settlement in less than 5 years if all the requirements are met, for instance:

Visa Category	Minimum Period of Residence in the UK
Tier 1 (Investor) – £5 million investment	3 years
Tier 1 (Investor) – £10 million investment	2 years
Innovator	3 years
Global Talent (depending on sub-category and endorsing body)	3 years

Is it Possible to Combine Time Spent in Another Visa Category?

Depending on the individual’s current and previous visa categories, it may be possible to combine time spent continuously in the UK, to meet the relevant minimum residence period. For instance, if an individual has spent a continuous period of 5 years in the UK, with 3 years in the Sole Rep category, and subsequently 2 years in the Skilled Worker category, then the minimum 5 year residence period is met. However, the same minimum residence period is not met if combining 2 years on a Student visa and 3 years in the Skilled Worker category.

There is also the Long Residence rule which means individuals who have continuously and lawfully lived in the UK for 10 years, can combine all their different UK visas to become eligible to apply for settlement. Under the Long Residence rules, the Home Office currently state that absences from the UK cannot be more than 540 days.

Conclusion

The rules to become eligible to apply for settlement in the UK will be different for each individual, dependent on their own immigration circumstances. Employers/sponsors should ensure that key dates are diarised to ensure appropriate steps are taken at the correct time, and that good records are kept.

Further information

If you have any questions and/or would like tailored advice on any UK immigration matter, please speak to Dixcart Legal at: advice.uk@dixcart.com or to your usual Dixcart contact.