Malta Residence Schemes Overview

A lot of information is available online on the various residence schemes offered by Malta for expatriates considering Malta as a residence base for them and their families. Some are accurate, others are outdated.

I would like to add my comments to a number of Malta residence schemes mentioned on the net:

The Malta Permanent Residence Scheme

By far the most successful residence scheme, in the Euro-Mediterranean area, this is a residence scheme that gives permit holders the right to reside in Malta indefinitely subject to observance of simple rules: a minimum annual income or minimum wealth requirement, the obligation to buy or rent property, a minimum tax liability. Taxation under this scheme was a low flat rate of 15% applicable on a remittance basis. The Permanent Residency Scheme was introduced in 1988 and was revived in 2013, so that it now complements a number of residency schemes issued in 2011.

Malta Retirement Scheme

The Malta Retirement Residence Scheme is a residence scheme for pensioners seeking a mix of mild-weather and low tax rates.  Set at a flat rate of 15%, Malta's tax rate applies on the entire gross pension received, subject to a minimum tax of €7500 per annum, increased by €500 per dependent. A husband and wife must pay a minimum of €8000   The pension or aggregate of pensions need to make up at least 75% of the total income chargeable to tax in Malta. This scheme is the only residence scheme that imposes a minimum residence requirement of 90 days a year averaged over any five-year period.  It also imposes that a beneficiary of the scheme must not reside in any other single jurisdiction for more than 183 days in any year.

The High Net Worth Individual Scheme

This scheme was introduced in 2011 and comes in two variants: one for HNW EU nationals and one for HNWI non-EU nationals. This scheme grants special tax status to expatriates moving to Malta who will be taxable in Malta on a remittance basis only at at the low flat tax rate of 15%. Residents under this scheme are able to use Malta's extensive double taxation treaty network. Eligibility requirements include: minimum property acquisition value Euro400K / minimum property rental value Euro20-25K, minimum tax Euro20-25K.

Ordinary Residence in Malta

As Ordinary Residents, non-domiciliaries will be taxable in Malta on a source and remittance basis, that is to say, on income (employment income, interest income, dividend income, pension income) arising in Malta and on such income arising outside Malta to the extent that it is received in the resident's Malta bank account. As a result, any foreign source income is not within the scope of Malta's personal income tax system and is therefore non-taxable.

Should you wish to discuss the suitability of the above or other residence schemes that may be available for specific industries or profiles, feel free to contact me through this blog. For the fastest response to your query, please use my firm's contact form.