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Malta – Attractive Residence Programmes and Tax Benefits for Expatriates
Malta offers five residence programmes to meet different individual circumstances. Some are appropriate for non-EU individuals while others provide an incentive for EU residents to move to Malta.
The five residence programmes and the tax benefits they can provide for individuals, where relevant, are detailed below.
- INDIVIDUAL INVESTOR PROGRAMME
The Individual Investor Programme (IIP) enables non-EU individuals and their families to gain Maltese citizenship by making a cash contribution and meeting certain other criteria.
Maltese citizenship provides a Maltese passport. A key advantage of obtaining a Maltese passport is that it is an EU passport, which provides freedom of residence anywhere in the EU and ease of travel throughout the world.
The main applicant must make the following investments:
- Contribute €650,000 to the National Development and Social Fund; AND
- Purchase property in Malta with a minimum value of €350,000, to be held for five years, or rent a property for a minimum value of €16,000 per annum for a minimum of five years; AND
- Invest a minimum of €150,000 in eligible Government stocks, shares or debentures for five years.
There is a further requirement before the applicant and family are eligible to take up residence in Malta; the Malta IIP requires an additional contribution of €25,000 for a spouse and for each child under the age of 18. A contribution of €50,000 is required for each unmarried child between the ages of 18 and 25 years, and for each dependant parent over the age of 55.
- RESIDENCE AND VISA PROGRAMME
The Maltese Government introduced a new residence programme in August 2015. It is available to non-EU individuals and enables them to reside indefinitely in Malta.
The criteria for the programme are:
- A €30,000 contribution to the Maltese Government; AND
- An investment of a minimum of €250,000 in Malta or Gozo for at least five years; AND
- The purchase of a property in Malta with a minimum value of €320,000 (€270,000 if the property is situated in Gozo or the south of Malta) or rental of a property in Malta for a minimum of €12,000 per annum (€9,000 per annum if the property is situated in Gozo or the south of Malta). The property must be owned or rented for at least five years.
- Tax Advantages Available to Individuals – Residence and Visa Programme
Individuals, taking advantage of this programme, who are not of Maltese origin and intend to stay in Malta for some considerable time but do not intend to permanently establish themselves in Malta, will be classified as resident but not domiciled in Malta.
Such individuals will be taxed on Malta source income and certain gains arising in Malta. They will not be taxed on non-Malta source income not remitted to Malta. Capital gains will not be taxed even if they are remitted to Malta.
- GLOBAL RESIDENCE PROGRAMME
The Global Residence Programme entitles non-EU nationals to obtain a Maltese residence permit through a minimum investment in property in Malta.
Successful applicants can relocate to Malta if they choose to do so. They also have the right to travel to any country within the Schengen Zone of countries without the need for an additional visa(s).
To qualify for the scheme an individual must purchase property costing a minimum of €275,000 or pay a minimum of €9,600 per annum in rent. If the property is in Gozo or the south of Malta the minimum property value is €250,000 or €220,000 respectively, or a minimum rent payment of €8,750 per annum is required. In addition an applicant must not spend more than 183 days in any other jurisdiction in any single calendar year.
- Tax Advantages Available to Individuals – Global Residence Programme
A flat rate of 15% tax is charged on foreign income remitted to Malta, with a minimum amount of €15,000 tax payable per annum (income arising in Malta is taxed at a flat rate of 35%). This applies to income from the applicant, his/her spouse and any dependants jointly.
Foreign source income not remitted to Malta is not taxed in Malta.
Individuals may also be able to claim double taxation relief under the regime.
- HIGHLY QUALIFIED PERSONS PROGRAMME
The Highly Qualified Persons Scheme is directed towards professional individuals earning over €81,457 per annum, employed in Malta on a contractual basis.
This scheme is open to EU nationals for five years and to non-EU nationals for four years. A list of qualifying positions is available on request.
- Tax Advantages Available to Individuals – Highly Qualified Persons Programme
Income tax is set at a flat rate of 15% for qualifying individuals (instead of paying income tax on an ascending scale with a current maximum top rate of 35%).
No tax is payable on income earned over €5,000,000 relating to an employment contract for any one individual.
- RETIREMENT PROGRAMME
The Malta Retirement Programme is designed for EU nationals whose main source of income is their pension.
An individual must own or rent a property in Malta as his/her principal place of residence in the world. The minimum value of the property must be €275,000 in Malta or €250,000 in Gozo or south Malta; alternatively property must be leased for a minimum of €9,600 annually in Malta or €8,750 annually in Gozo or south Malta.
In addition there is a requirement for an applicant to reside in Malta for a minimum of 90 days each calendar year, averaged over any five year period. EU nationals must not reside in any other jurisdiction for more than 183 days in any calendar year during which they benefit from the Malta Retirement Programme.
- Tax Advantages Available to Individuals – The Retirement Programme
An attractive flat rate of 15% tax is charged on a pension remitted to Malta. The minimum amount of tax payable is €7,500 per annum for the beneficiary and €500 per annum for each dependant.
Income that arises in Malta is taxed at a flat rate of 35%.
How Can Dixcart Assist?
Dixcart can assist in providing advice as to which programme would be most appropriate for each individual or family. We can also organise visits to Malta, make the application for the relevant Maltese residence programme, assist with property searches and purchases and provide a comprehensive range of individual and professional commercial services once relocation has taken place.
For further information about moving to Malta please contact Henno Kotze at the Dixcart office in Malta: firstname.lastname@example.org. Alternatively, please speak to your usual Dixcart contact.