Malta Residence Programme Regulations (2014)
The Malta Residence Programme (MRP) allows nationals of the EU, EEA or Switzerland to qualify for a taxable rate of 15% on foreign source income remitted to Malta, whilst also claiming double tax relief on that income.
A Little More Detail…
This programme is open to any EU, EEA or Swiss national who is not a permanent resident in Malta.
A EU, EEA or Swiss national domiciled in Malta is taxable in Malta on local source income and capital gains, as well as foreign source income, which is received in Malta (but not foreign source capital gains, even if it is received in Malta).
Applicants must not be beneficiaries of any other tax programmes that the Maltese government offers.
Foreign source income that is received in Malta is taxable at the flat rate of 15%.
There is the possibility of claiming double tax relief, subject to a minimum annual tax liability of €15,000 per annum.
All other income not covered by these conditions is charged separately at the rate of 35%.
Applicants must own or rent what is known as a ‘Qualifying Property Holding’ in Malta, and may not stay in any foreign jurisdiction for more than 183 days in a calendar year.
The Qualifying Property may be bought or rented. A ‘Qualifying Owned Property’ must be valued at not less than €275,000 if located in Malta or valued at not less than €220,000 if located in Gozo or in the south of Malta.
A ‘Qualifying Rented Property’ must have an annual rent of €9,600 per annum if located in Malta or an annual rent of no less than €8,750 per annum if the property is located in Gozo or in the south of Malta.
The Qualifying Property Holding must be retained on an ongoing basis. The official locations that qualify as being in the south of Malta are: Birżebbuġia, Qrendi, Cospicua, Safi, Fgura, Santa Luċija, Għaxaq, Senglea, Gudja, Siġġiewi, Kalkara, Tarxien, Kirkop, Vittoriosa, Luqa, Xgħajra, Marsascala, Żabbar, Marsaxlokk, Żejtun, Mqabba, Żurrieq, and Paola.
In addition, an applicant to this programme must be in receipt of stable and regular resources that are sufficient to maintain him/herself and any dependants.
Possession of a valid travel document is mandatory, as well as a health insurance policy that covers the applicant and all dependants. This must be valid across the EU and must provide the same cover as would normally be provided to Maltese nationals.
All applicants must be able to adequately communicate in either Maltese or English, as both are national languages of the Maltese Islands.
Finally, applicants must consent to having the Inland Revenue Department carry out international due diligence to ensure that the applicant is a ‘fit and proper’ person. This will be done prior to the granting of special tax status.
Beneficiaries of this programme (applicants that have been granted special tax status) must then satisfy certain criteria on an ongoing basis. Beneficiaries of the MRP must not become a Maltese national, or a long-term resident. They must also retain the Qualifying Property Holding as well as the health insurance policy. In addition, all beneficiaries must continue to have stable resources and income.
It should be noted that there are special reporting obligations and notifications that must be complied with. Proof of the ongoing satisfaction of criteria must be provided annually.
Each application carries a one-off, non-refundable registration fee of €6,000, reduced to €5,500 if the Qualifying Property is located in the south of Malta. This must be paid upon application for the programme.
Take This Further
Applications for the Malta Residence Programme can only be made via an Authorised Registered Mandatory that is registered with the Inland Revenue Department. The specialists at RE/MAX Malta will be able to guide you through the best choices in this process.