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Malta Residence - Tax Benefits
Malta is a member of the European Union and the Schengen area and located in the southern Mediterranean with an all year mild climate.
The country's tax system offers various benefits to individuals transferring their residence there.
I. The basic taxation system
While most continental European countries distinguish for tax purposes only between resident and non-resident, Malta knows the additional criteria of ordinarily resident and domiciled.
For residents of Malta income taxes is imposed taxes either on a
• Worldwide basis
for individuals who are ordinarily resident and domiciled in Malta
Subject to double taxation treaties all oncome wherever it arises in the world is taxable
• a remittance basis
for individuals who are resident but either not ordinarily resident or not domiciled in Malta.
In this category only income earned in Malta and income earned abroad and transferred (remitted) to Malta. Capital or capitals gains remitted to Malta are on the other hand not taxable. Pre-immigration restructuring can improve the benefits.
II. Special taxation schemes
In addition, Malta offers special taxation programs:
• The Residence Programme
This program can be applied for by nationals of the EU, EEA or Switzerland.
If a qualifying property is bought or rented and other conditions are met, the beneficiaries of this program enjoy a reduced tax rate of 15% on foreign income transmitted to Malta. Malta sourced income will be taxed at rate of 35%. A minimum annual tax of currently EUR 15.000 is applied.
• The Global Residence Programme
This program offers similar benefits to citizens of countries other than EU, EEA or Switzerland.
• Malta Retirement Programme
Under certain conditions retirees as well as the beneficiary's spouse and children
can benefit of a reduced income tax rate of 15% on foreign pensions that are remitted to Malta. In combination with double taxation treaties this can offer a tax efficient way to maximize the retirement in a southern Mediterranean location.
In addition Malta offers fast track ways to obtain Maltese citizenship.