• Purchasing Property in malta

  • February 2013

    • The High Net Worth Individuals Scheme has replaced the Permanent Residence Scheme, which was suspended in December 2010. The new scheme addresses two categories of applicants: those within the European Union (EU) and the European Economic Area (EEA) together with Swiss Nationals, and third country nationals, who are defined as persons who are not citizens of the EU, according to the meaning in Article 20 of the Treaty on the EU and the Treaty on the Functioning of the EU.


  • The relevant thresholds have been increased, requiring applicants to purchase property with a value not lower than €400,000, or rent property where the rent payable is of no less than €20,000 per annum. The emphasis is on the quality of person being attracted to Malta, particularly individuals who will contribute to the economy of the country, which is why the scheme targets high net worth individuals. Under the previous scheme no periods of stay were imposed. Under the new scheme, applicants need not be domiciled in Malta, but they must have health insurance and a stable and regular income, as well as pass a ‘Fit and Proper’ test. Through this test, undesirable applicants are filtered out. The registration process costs €6,000. This is according to Subsidiary Legislation 123.131.

    Continuing obligations on successful applicants require them to retain holdings of the qualifying property; retain insurance and their stable source of income; and not become Maltese domiciliaries, but reside in Malta for a minimum of ninety days, without leaving for a strech longer than 183 days. They are also obliged to inform the Maltese government of changes in their situation, e.g. relating to the qualifying property or their stable source of income.  

    Successful applicants benefit from a 15% tax rate on foreign income received in Malta, with the possibility of claiming double tax relief. The minimum tax is of €20,000 per annum, together with an additional €2,500 per dependent of the applicant.

    As regards applications from applicants outside the EU and EEA and from non-Swiss Nationals, additional special regulations apply. Third country nationals wishing to become long-term residents or who are already long-term residents of Malta are required to enter into a qualifying contract with the government, bearing a financial bond (deposit) of €500,000, and an additional €150,000 per dependent. The tax rate insofar as they are concerned is the same as for EU/EEA/Swiss nationals (15%), while the minimum tax cap is €25,000, with an additional €5,000 per dependent.

    For a detailed account of the rules applicable to EU/EEA (EU, Iceland, Norway, Liechtenstein) and Swiss Nationals, reference must be made to Subsidiary Legislation 123.129: http://www.justiceservices.gov.mt/DownloadDocument.aspx?app=lom&itemid;=11761&l;=1.

    Meanwhile, the rules regulating the position of non-EU, non-EEA and non-Swiss nationals are found in Subsidiary Legislation 123.130: http://www.justiceservices.gov.mt/DownloadDocument.aspx?app=lom&itemid;=11762&l;=1.

    This information has been provided merely for information purposes and does not constitute legal or specialist advice. Should more information be sought it is recommended to contact Valletta Legal.

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