Beneficiaries under the Residence Programme will be issued with a residence permit and entitled to a special status by the Malta International Tax Unit (ITU) whereby income generated overseas, but remitted to Malta will be taxed at a fixed rate of 15%.

Eligibility

An individual shall be qualify to apply for special tax status under the Residence Programme, if he or she complies with the below criteria:

• applicant must be either an EU, EEA or Swiss national;
• applicant must hold a qualifying immovable property in Malta;
• the applicant must substantiate receipt of regular funds and resources that are sufficient to maintain himself, as well as his or her dependants;
• must be in possession of a valid travel document;
• maintain a health insurance policy covering himself and his dependants;
• must be able to communicate in English or Maltese;
• does not already benefit from any other tax programme in Malta;
• must be deemed to be a “fit and proper person” and satisfy all due diligence checks carried out by the International Tax Unit (ITU).

Administration Cost

Upon application submission an administrative fee of €6,000 must be paid to the ITU (€5,500 if the qualifying property is situated in Gozo or the south of Malta). This administrative fee would cover the due diligence checks and will not be refundable should the application be refused.

Qualifying Property

Applicant must acquire a property in Malta for a minimum value of €275,000 (€220,000 if situated in Gozo or the South of Malta)

Or

Lease a property in Malta for a minimum annual rent of €9,600 (€8,750 if property is situated in Gozo or the south of Malta).

The qualifying property would need to be retained for the duration of the tax residence.

Tax Treatment

All foreign sourced income remitted to Malta shall be taxable at a flat rate of 15%, with the possibility of claiming double tax relief on such income.

There is a minimum annual tax of €15,000 on income that is remitted to Malta;

Income not remitted to Malta would not be taxable in Malta;

Income generated in Malta would be taxable at 35%;

A beneficiary and his spouse cannot opt for a separate tax computation.

Continuous Obligations

The following yearly obligations must be complied with:

1. The Qualifying Property Holding must be retained;
2. must not become domiciled in Malta;
3. pay the annual tax;
4. must not reside in any other single jurisdiction for a period exceeding 183 days;
5. the health insurance policy must be retained
6. Submit an annual tax return, together with an annual declaration confirming that all conditions of the programme have been adhered to.

Application Process

Phase 1 – Application

– Application documents are submitted to the ITU on behalf of the client, together with a receipt confirming that the administration fee has been paid.

– Upon receiving the documents ITU the will issue an acknowledgment letter and the due diligence process will commence.

Phase 2 – Due Diligence

– The process takes approximately six (6) weeks.

-If the applicant is approved from the due diligence process, a letter of approval in principle will be issued by ITU and the applicant will be invited to an introductory meeting at ITU.

Phase 3 – Investments

-If approved the Main Applicant would need to submit his agreement to the Qualifying Property and a confirmation of tax residence will be issued shortly afterwards

– The confirmation letter may be used to apply for a Maltese residence card.