Visitors and holiday homeowners
If you spend less than six months in a single calendar year in Malta, there is no tax liability. Normally, non-Maltese nationals are allowed to purchase one immovable property in Malta in their own name (unless this is situated in a Special Designated Area, such as Portomaso, Tigne’ Point, Tas-Sellum Complex and the Cottonera Waterfront), valued at more than €101,551 for an apartment, and more than €169,205 for a house.
Non-Maltese nationals may purchase more than one property in their name, or in the name of a company or trust, in a special designated area (SDA). These properties may also be purchased for letting purposes..
EU citizens who have resided in Malta for a minimum period of five continuous years at any time preceding the date of acquisition, may freely acquire more than one immovable property without the necessity of obtaining a permit.
There are no property rates, or property taxes in Malta.
Temporary residents
A number of foreign nationals opt for temporary residence if they have minimal or no tax liability in their former country of residence. The word temporary, however, is a misnomer as there are temporary residents who have lived in Malta for scores of consecutive years. A three-month visa is automatically granted at the port of entry upon arrival in Malta
For visa extensions, applications together with three passport-sized photos should be submitted to the Principal Immigration Officer, Police Headquarters, Floriana. The first extension is usually for a further three months and, thereafter, extensions are normally for six or twelve months. Although applications are usually granted, you may be asked to provide documentary evidence confirming a sound financial position adequate to support the applicant and his/her family. In this case, a bank statement would normally be sufficient.
Temporary residents, who extend their stay in Malta beyond six months in any one calendar year, will be subject to tax in Malta on income received in Malta, or income arising in Malta during the period of stay. Remittances of a capital nature are not taxable. Temporary residents may purchase a residence in Malta, which must be valued at more than €99,042 (Lm42,519) for a flat, and more than €165,024 (Lm70,845) for a house. The current tax rates are as follows:
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Temporary Residents
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|
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Married
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Single
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First
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€10,016
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Free
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€7,221
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Free
|
|
Next
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€3,960
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15%
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€2,329
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15%
|
|
Next
|
€2,912
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20%
|
€2,096
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20%
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|
Next
|
€2,912
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25%
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€2,329
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25%
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|
Next
|
€3494
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30%
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€1,747
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30%
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Excess
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35%
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|
35%
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Eg. A married couple with a joint income of €10,020 (Lm4,300 () pays no tax; on €12,811 (Lm5,500), tax amounts to €419 (Lm180) i.e. 3.6%. Couples with independent employment, business, or pension incomes may opt for a separate computation, in which case the first €14,425 (Lm6,200) would be tax-free.
Permanent residents
The current scheme for foreigners who take up residence in Malta came into effect on January 1, 1988. This scheme is of particular interest to those nationals with a relatively high income, who are subject to a high tax rate in their present country of residence. Under the scheme, an applicant who is not Maltese must either own assets outside Malta, worth not less than €349,410, or be in receipt of an annual income of not less than €23,294. There is no minimum stay requirement.
Conditions
The prospective new resident will be required to: remit to Malta at least €13,980 per annum, plus €2,329 per annum per dependent each year; purchase residential premises in Malta at a cost of not less than €132,611 in the case of a house, or €79,566 for a flat, or rent/lease the abode he lives in at not less than €4,193 per annum; not engage in gainful occupation in Malta. Limited gainful activities in Malta may be authorised.
Concessions
Holders of a residence permit under this scheme will be subject to tax on the chargeable income remitted to Malta at a flat rate of 15%. However, there is a minimum liability of €4,193 per annum. Remittances of a capital nature are not taxable.
Death/Succession duty
There is a 5% stamp duty payable on transmission of property. No capital gains tax is payable on the first sale after inheritance.
Property rates
There are no property rates, or property taxes in Malta. Profit on the sale of one’s residence is not subject to capital gains tax if sold after three years of ownership.