Residence & Immigration
Malta has always attracted an array of foreigners over the centuries. All major civilisations around Europe and the Mediterranean Sea have been to Malta over the centuries including the Phoenicians, the Romans, the Normans, the Arabs, the French and the English. Our culture, gastronomy, language and laws draw inspiration and influences from such varied sources, which altogether have made Malta a unique cultural melting pot.
In recent years Malta has been also attracting individuals from around the globe to come to work, settle and retire here. Advocates Primei has assisted numerous clients with all that is necessary in order to achieve residence in Malta. We can assist with attaining the residence permits, assisting with property leasing or acquisition and also explaining the tax local considerations and ramifications on one’s income and wealth.
Under Maltese tax laws, individuals are subject to tax in Malta on the basis of their residence and domicile. Individuals who are deemed to be both resident and domiciled in Malta are subject to income tax on a worldwide basis. Income earned, accrued or derived in Malta or elsewhere is subject to tax in Malta irrespective of whether the foreign source income is remitted to Malta or not. However, most expats are in terms of Maltese law only acquiring a residence as they would retain their current (foreign) domicile. Such resident non-domiciled persons are only taxed in Malta on income arising in Malta and any Income remitted to Malta. Beneficially foreign Capital Gains are not taxed irrespective of whether these are remitted or not.
An individual may take up residence in Malta by declaring his intention within three months of arrival in Malta. For tax purposes, an individual is considered to be a “resident in Malta” when he resides in Malta except for such temporary absences as to the Commissioner may seem reasonable and not inconsistent with the claim of such individual to be resident in Malta. The definition of a resident is clearly not directly tied to the duration of stay in Malta, however it is generally understood that one would definitely be considered as a Maltese resident for a particular year if, during that year, his stay in Malta exceeds 6 months.
Advocates Primei can assist clients with any matter relating to Residence and Immigration, including with appeals from any permit refusal or extension refusal.
Specifically, we can assist with any of the following residence options:
Residence under the EU’s Freedom of Movement
EU nationals have the right to reside in Malta if they are exercising any of their Treaty rights as workers, self-employed persons, economically self-sufficient persons or students. EU nationals and their family members can accept offers of work and seek employment in Malta and can also work as a self-employed or set up a local business.
People who are seeking to retire in Malta, or who do not need to work usually take up residence under the self-sufficiency route. They would need to prove that they have the minimum capital or income in order to maintain themselves in Malta and also have be covered by sickness insurance covering them and their family against all medical risks whilst in Malta.
An EU national (and his family members) who has legally lived in Malta for a continuous period of five years will be entitled to apply for confirmation of permanent residence.
We can assist clients with any application for residence under the EU’s freedoms, including assistance guidance and advice with work permit applications, and assistance with Self Sufficiency Applications.
Single Permit Applications
Any Non-EU person, also known as Third Country National (TCN), wishing to take up employment in Malta is required to obtain a Single Permit from the Identity Malta Agency, in terms of Subsidiary Legislation 217.17.
TCNs may submit an application whilst they are either still-abroad or legally staying in the Maltese territory. Those individuals who lodge an application while staying in Malta must have a valid VISA in order to do so. If the applicant is not yet in Malta, the employer may submit a new single permit application on his/her behalf and this is considered as being a Still Abroad application. The single permit is renewed annually and applicants are required to proceed within 90 days from the date of expiry. Renewal of applications may only be submitted while their current permit is still valid.
We can assist employees or employers with a Single Member application. We can advise on the correct procedure and contents of the applications. We can also help lodge appeals when an application is refused.
Global Residence Program (GRP)
The Global Residence Programme Rules have been brought into force as of the 1st of July 2013 by means of legal notice 167 of 2013. This scheme shall apply to third country nationals (non-EU Nationals) and their dependants who do not currently benefit from any other special tax status. In order to be eligible for application, the applicant must also hold a qualifying property building, be in possession of a valid travel document, be fluent in one of Malta’s official languages and be considered as a fit and proper person. Additionally, rules also require that the beneficiary be in possession of a sickness insurance and be in receipt of stable and regular resources that are sufficient to maintain the beneficiary and the dependants without the need to resort to the social assistance system in Malta.
The scheme entitles the beneficiary to enjoy a tax rate of 15% for income which arises outside of Malta in the year immediately preceding the year of assessment which is received in Malta (including income arising outside Malta and received in Malta during the whole of the year in which the special tax status was granted) by the beneficiary, the beneficiary’s spouse and children with the possibility to claim relief of double taxation. The Rules stipulate a minimum amount of tax payable which is that of €15,000 for any year of assessment.
Malta Retirement Programme
Issued in October 2012, the Malta Retirement Programme Rules (MRP) (Legal Notice 317/2012) provides for a special tax status for retirees from the EU, EEA countries and Switzerland who remit their pension to Malta.
Individuals benefiting from this programme may hold a non-executive post on the board of a company resident in Malta but are prohibited from being employed by the company in any capacity. Such individuals may also partake in activities related to any institution, trust or foundation of a public character and any other similar organisation or body of persons, which are also of a public character, that is engaged in philanthropic, educational or research and development work in Malta.
An attractive tax rate of 15% is payable on the portion of pension remitted provided that the minimum tax payable is that of €7,500 for the beneficiary and € 500 for every dependent. This rate of tax will apply from the date of confirmation of the special tax status which is referred to as the “appointed day” up to “day of cessation of status”. Progressive tax rates are to apply in the days prior to the appointed day or subsequent to the day of cessation of status.
The Residence Programme Rules (TRP)
The Residence Programme Rules were introduced in 2014 and is very similar to the Global Residence Programme described above.
The Residence Programme introduces a similar programme tailored for Expats who are EU, EEA or Swiss nationals. Such applicants cannot be Maltese nationals/citizens and must not be currently benefiting from any other special tax status in Malta. In order to be eligible for the programme the applicant must also hold a qualifying property and satisfy the other requirements set out above.
Similarly this also entitles the beneficiary to enjoy a tax rate of 15% for income which arises outside of Malta in the year immediately preceding the year of assessment which is received in Malta (including income arising outside Malta and received in Malta during the whole of the year in which the special tax status was granted) by the beneficiary, the beneficiary’s spouse and children with the possibility to claim relief of double taxation. The Rules stipulate a minimum amount of tax payable which is that of €15 000 for any year of assessment.
Highly Qualified Person Rules
In 2011, Malta introduced specific tax rules, namely the Highly Qualified Rules, intended to attract top expertise and skill in the financial services, remote gaming and aviation sectors, enabling operators in these sectors to attract and recruit the highest qualified, experienced and senior professionals available globally.
In essence, the scheme is designed to attract highly qualified persons to occupy eligible offices with companies licensed and/or recognized by the MFSA, the LGA and companies holding an Air Operators’ Certificate issued by the Authority for Transport in Malta.
In accordance with these Rules, applicants that successfully register under the scheme are entitled to benefit from a fixed reduced tax rate of 15 % on all income derived from their employment in Malta. Should the income from a qualifying employment exceed €5,000,000 per annum, no further tax is chargeable on the excess.
Malta Residence & Visa Program (MRVP)
The Malta Residence and Visa Programme was created in 2015 and is available to any third country nationals (non-EUs) wishing to settle in Malta together with their family and also enjoy visa free travel within Europe and other Schengen countries. This provides for the application of a residence certificate which will be issued by Identity Malta Agency (IMA) and once such certificate is issued it confers residency right to the holder and to his registered dependents. Such residency rights mean they are free to settle and stay in Malta indefinitely and also to come and visit Malta, Visa free at any time.
This is not specially a tax incentive programme however holders of the certificate will still benefit from the non-domicile concept of taxation – namely that only income arising in Malta or income arising abroad and sent to Malta are taxable in Malta.
Qualifying Employment in Innovation and Creativity (Personal Tax) Rules
Following the success introduction of the ‘Highly Qualified Persons’ scheme, with effect from the 1st of January 2013, Malta introduced another scheme intended for expatriates working in Malta named the Qualifying Employment in Innovation and Creativity (Personal Tax) Rules. The scheme is intended for individuals who fulfil a role directly engaged in the development of innovative and creative digital products.
These rules provide an opportunity for individuals working in the development of innovative and creative digital products in Malta in opting to have their employment income in respect of work exercised in Malta to be chargeable at a reduced rate of 15%.
In fact, income from a qualifying contract of employment in an “eligible office” is subject to tax at a flat rate of 15% provided that the taxable income is at least €45,000. This minimum amount of income shall be adjusted annually in line with the Retail Price Index as published in the Gazette by the National Statistics Office.
The 15% tax rate applies to income up to a maximum €5,000,000. Thus, should any income exceed the maximum amount of €5,000,000, no further tax would be charged on the excess income.
Maltese Citizenship under the MIIP
The Malta Individual Investor Programme (MIIP) is designed to facilitate the manner in which an individual and the members of his family can become Maltese Citizens, through a combination of investment and residence in Malta.
All applicants and their families will have to go through a strict due diligence exercise and will also have to create sufficient links and ties to Malta. Such applicants will also need to invest in Malta through the National Development and Social Fund established by the Government of Malta with the purpose of effecting qualitative improvements in Malta through public interest, social and capital projects.
As Maltese citizens, successful applicants will have access to all EU and Schengen Countries and will also benefit from visa-free travel to more than 160 countries, including the USA. This program is fully compliant with EU legislation and has been recognised by the EU Commission.
Advocates Primei, through its corporate services arm Primei Fiduciary Ltd., has been approved and licenced by Identity Malta (http://iip.gov.mt) as an Accredited Person for the purposes of the Malta Individual Investor Program (MIIP). We have substantial experience with dealing with Maltese residence and personal tax issues. In terms of such accreditation issued by Identity Malta, we are authorised to submit applications on behalf of clients under the MIIP and to also promote and market such a Programme.