Insights

The Malta Residence and Visa Programme

Deloitte Malta factsheet #031

Insightful applications providing information on taxation relating to the Maltese jurisdiction, prepared by Deloitte Malta professionals.

Introduction

In terms of Legal Notice 288 of 2015, the Malta Residence and Visa Programme (“MRVP”) has been introduced for individuals who are not nationals of the EU, EEA or Switzerland. The MRVP rules confer the successful applicant a certificate for residence in Malta and which entitles the applicant and their eligible registered dependents to reside, settle or stay indefinitely in Malta provided that the conditions of the MVRP continue to be satisfied. The certificate issued under these regulations shall be monitored annually for the first five years and every five years thereafter.

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FS031: The Malta Residence and Visa Programme

What are the minimum criteria for eligibility for the main applicant?

To be eligible to apply under the Programme an applicant should be neither a permanent resident nor a long-term resident of Malta. The applicant must prove to the satisfaction of the Commissioner for Revenue (the “Commissioner”) that he/she satisfies all of the conditions set out below:

1.   Individual is at least 18 years of age;

2.   Individual is a third-country national and not a Maltese, EU/EEA/Swiss national;

3.   Individual is required, in each five year period from the date of issue of the residence certificate, to spend a period of time outside of Malta. This period must be either:

        i.    six consecutive months; or

       ii.    an aggregate period of ten months over the five year period;

4.   Individual and their dependents are in possession of a valid travel document;

5.   Individual is in receipt of stable and regular resources which are sufficient to maintain themselves and their dependents without recourse to the social assistance system of Malta;

6.   Individual is not a person who benefits under Malta’s Residents Scheme Regulations, the High Net Worth Individuals - EU/EEA/Swiss Nationals Rules, the Malta Retirement Programme Rules, the Residence Programme Rules, the Qualifying Employment in Innovation and Creativity Rules or the Highly Qualified Persons Rules;

7.   Individual is in possession of health insurance for themselves and their dependents in respect of all risks across the whole of the European Union which are normally covered for Maltese nationals;

8.   Individual has an annual income of not less than €100,000 arising outside of Malta or is in possession of capital of not less than €500,000. An affidavit to this effect is to be signed;

9.   Individual must acquire and hold, for a minimum period of five years from the date of the issue of the certificate, a residential property in Malta purchased for not less than €320,000 if situated in Malta or €270,000 if situated in Gozo or in the South of Malta. Alternatively, they must lease a residential property in Malta for a minimum annual rent of €12,000 if the property is situated in Malta or €10,000 per annum if the property is situated in Gozo or in the South of Malta;

10.  Individual must hold, for a minimum period of five years from the date of the issue of the certificate, a qualifying investment having an initial value of €250,000;

11.  Individual must make a ‘one-time’ financial contribution of €30,000 to the Government of Malta. A non-refundable application fee of €5,500 constitutes a part payment of this financial contribution.

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Who qualifies as a dependant of the applicant?

The following dependents of the main applicant are eligible for consideration under this programme:

  • Spouse;
  • Any child, including an adopted child, of the main applicant or spouse, who is less than 18 years of age;
  • Any child of the main applicant or spouse, who is between 18 and 26 years’ old who is not married and who is wholly maintained by the main applicant;
  • Any parent, or grandparent, of the main applicant or spouse, who proves to the satisfaction of the appropriate Minister that they are not economically active and are principally dependent on the main applicant; and
  • Any child of the main applicant or spouse, who is more than 18 years old and who is physically or mentally disabled and who is living with and is fully supported by the main applicant..

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What are the minimum criteria for eligibility for both the main applicant and the dependant?

  • A proper background verification of the applicant and their dependents over 12 years of age;
  • Clean criminal record certificate issued by the Malta police authorities as well as by the competent authorities in the country of origin and in any country where the applicant has resided for more than six months during the last 10 years. In very exceptional circumstances and only if such criminal record certificates are not obtainable, an affidavit declaring a clean criminal record may be accepted;
  • Not indicted before the International Criminal Court or listed with Interpol (International Criminal Police Organisation);
  • Not a potential threat to Malta national security, public policy or public health;
  • Not have pending charges related to crimes of terrorism, money laundering, funding of terrorism, crimes against humanity, war crimes, or crimes that infringe upon such Protection of Human Rights and Fundamental Freedoms as established by the European Convention on Human Rights, or who has been found guilty of any such crimes;
  • Not found guilty or have charges brought against them regarding any criminal offence that disturbs the good order of the family;
  • Not found guilty or is being suspected, interrogated or charged for any criminal offence (other than involuntary offences) punishable with more than two years imprisonment. A sworn declaration before a Commissioner for Oaths is required to the effect that the information provided is true and correct; and
  • Not deemed to be against the public interest.

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Other qualifying beneficiaries

Beneficiaries of the Global Residence Programme shall be allowed to apply for the issuance of a certificate in terms of these regulations subject to satisfying all the additional eligibility requirements.

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Application process

Every application shall be presented to and examined by the competent authority – Identity Malta – through an Accredited Person or approved agent of Identity Malta (Deloitte Malta is an Accredited Person of Identity Malta). A non-refundable fee of €5,500 is payable to Identity Malta on application. This amount is deducted from the financial contribution of €30,000 that the applicant must make if the application is approved.

Deloitte will advise on the preparation of the application forms, which must be accompanied by the relevant supporting documentation. The following are to be submitted with the application *:

  • A certificate issued by an appropriate medical authority or doctor confirming that the applicant and dependents are not suffering from any contagious disease and are in good health;
  • Clean criminal record certificate(s);
  • Bank and or other references evidencing the fact that the main applicant and dependents are fit and proper persons;
  • Tax factsheet
  • Undertaking to purchase or lease a qualifying residential property in Malta;
  • Undertaking to make the qualifying investment of at least €250,000 in Malta;
  • Undertaking to remit the financial contribution of €30,000; and
  • An affidavit of support by the main applicant for each dependent who is more than 18 years old.
  • All the documentation is required in English. If documentation is in a foreign language, Deloitte will assist in obtaining the required certified translations.

* List is not exhaustive and further documentation may be required.

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Scope of taxation in Malta

In terms of Malta income tax law, the scope of taxation in Malta largely depends on the individual’s residence and domicile. This will be determined separately from the MRVP application of the main applicant and their dependents and Deloitte will be able to assist with detailed advice depending on the circumstances of each applicant.

The term ‘resident’ in Malta, when applied to an individual, refers to an individual who resides in Malta except for such temporary absences as the Office of the Inland Revenue may deem reasonable and not inconsistent with the claim of such individual to be resident in Malta.

The term ‘domicile’ goes beyond residence and is not defined in Malta income tax law. The Office of Inland Revenue considers an individual’s domicile to be the territorial unit that regulates such things as their marriage, succession and legal capacity in general. Thus, non-Maltese nationals who are resident in Malta but do not intend to establish a permanent home in Malta do not generally acquire a Maltese domicile for Malta income tax purposes.

An individual who is resident but not domiciled in Malta is taxable only on all chargeable income arising outside of Malta to the extent that such income is remitted to or received in Malta (i.e. on a remittance basis) and on all chargeable income earned or derived in Malta (i.e., source income). Accordingly, any foreign source income not remitted to Malta would not be subject to tax in Malta.

In addition, all capital gains arising outside of Malta are not taxable in Malta irrespective of whether or not these gains are remitted to or received in Malta.

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Localities for the purpose of the definition of “South of Malta”

Birżebbuġia Cospicua Fgura
Għaxaq Gudja Kalkara
Kirkop Luqa Marsascala
Marsaxlokk Mqabba Paola
Qrendi Safi Santa Luċija
Senglea Siġġiewi Tarxien
Vittoriosa Xgħajra Żabbar
Żejtun Żurrieq  

 

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