Malta Tax Residency

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Malta’s approach to the global market has been making a difference for years, thanks to its favourable and competitive tax system that comprises of attractive features such as a full imputation system, refundable tax credit system and a large and expanding international tax treaty network.

Malta Tax Residency

The Income Tax Act (“ITA) does not incorporate a definition of the term ‘ordinary resident’. Thus, the derivation of such a concept may be elaborated by looking at the factual circumstances of a person. 

A person can be a resident of Malta without being ordinarily resident, however, ordinary residence requires more than mere residence. It connotes residence in a place with some degree of continuity. Most of the principles applied in Maltese fiscal legislation, are construed on the Common Law  model, most notably the principles of residence and domicile.  Similar, to the UK, Maltese resident-not-domiciled individuals (or “res-non-dom”) are subject to tax on a source and remittance basis.

In the case of income arising outside Malta to a person who is not ordinarily resident in Malta or not domiciled in Malta, the tax shall be payable on the amount received in Malta. 

No tax shall be payable on capital gains arising outside Malta to a person who is not ordinarily resident in Malta or not domiciled in Malta. 

In other words, a person who is subject to tax in Malta on the basis of source and remittance will be taxed at the resident rates on:

  • Any income earned in Malta; and
  • Any foreign income to the extent received in Malta.

Malta will not require disclosure of or impose any tax on:

  • Foreign source Capital Gains whether received in Malta or otherwise; and
  • Foreign income which is not received in Malta.

This competitive tax ecosystem is appealing not only to corporations, businesses, entrepreneurs and wealthy individuals who are seeking the best and most suitable tax advise, but also for individuals who already have or are willing to take up tax residence in Malta through a non-investment programme.

Different types of Malta Tax Residency Programmes

Our Team of Tax Advisors will be able to assist you and your family with your personal tax affairs, and especially with the tax-related side of the following programmes that will lead to Non-Investment Residence in Malta:

Key Employee Initiative

‘The Key Employee Initiative’ (KEI) has been introduced by Identity Malta with the aim of facilitating the issuing of single permits, which incorporate the work and residence permits, to highly-specialised third-country nationals who seek employment in Malta.

Highly Qualified Persons (HQP) Rules

This tax programme aims to attract highly qualified persons to occupy “eligible office” with companies licensed and/or recognized by the Malta Financial Services Authority – MFSA, Malta Gaming Authority – MGA or with undertakings holding an air operators’ certificate issued by Transport Malta.

The Malta Retirement Programme Rules

By virtue of the inclusion of the Subsidiary Legislation 123.134 to the Maltese Income Tax Act, a special tax status has been issued for retirees from EU, EEA countries and Switzerland when remitting their pension into Malta.

Ordinary Residence

A person is an ordinary resident in a country by taking into account the duration of the individual’s presence in the country, frequency, regularity and nature of visits to the country, as well as business and family ties.

EU and Non-EU members can apply for Ordinary residence in Malta, albeit they are subject to different requirements.

Should you wish to explore other programmes that grant you with a Malta Residence by Investment, please click here.

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