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Legal Tax Reduction

Malta’s Tax Residency Schemes for Nomads and Non-Doms

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This article discusses Malta’s tax residency schemes for nomads and non-doms. It will also discuss how establishing Maltese tax residency can benefit you as a digital nomad, investor, or entrepreneur.

European countries are often considered high-tax, but that’s not always true. With proper tax planning, you can live your best low-tax life even in a high-quality EU jurisdiction like Malta.

With several residency options and a citizenship-by-investment program, Malta is one of the best European countries to offer foreigners a place to live and work in exchange for their investment.

Eager to know how Maltese residency can help you reduce your tax bill? Contact us, and we’d love to answer all your questions.

Malta – Country Overview

Malta is an archipelago located in the heart of the Mediterranean Sea. Its three main islands are Comino, Gozo, and Malta. A gateway between Africa and Europe, Malta lies just 78.9 miles (127 kilometers) from the Italian island of Sicily.

What is the official language of Malta?

The official languages are Maltese and English, which makes Malta an excellent second residency or citizenship option for English-speaking people who don’t want to deal with a foreign language all the time while living abroad.

Is Malta part of the EU?

Malta claimed independence from Britain in 1964. It joined the EU in 2004 and adopted the Euro in 2008. Malta is also part of the Schengen Zone.

What Is the Total Population of Malta?

Malta has a population of approximately 518,536.

What Is the Total Population of Malta

Benefits of Malta Tax Residency for Nomads and Non-Doms

Establishing tax residency in Malta comes with a range of tax benefits for nomads and non-doms alike. Previously, high net worth individuals could apply for special tax status in Malta.

However, the HNWI Rules no longer apply. They have been superseded by the Residence Programme and the Global Residence Programme Rules.

The main benefit of becoming a Maltese tax resident through either the Residence Programme or Global Residence Programme (we will discuss the differences in the requirements section below, along with the Nomad Residence Permit) is becoming eligible for a remittance basis of taxation.

Remittance-based taxation means a 15% flat tax on any foreign income remitted to Malta by those not ordinarily resident in the country.

Malta is also an ideal country to incorporate a business. If you run the entity through a holding company registered abroad, you can limit your corporate income tax obligation to a mere 5%.

Maltese authorities have set up double taxation agreements, so you avoid paying taxes in another country on top of taxes in Malta.

Moreover, Malta is as business-friendly as it gets, with a diverse community, skilled workforce, high-speed internet connectivity, and excellent living standards.

Requirements for Malta Tax Residency for Nomads and Non-Doms

The Malta Nomad Residence Permit

The Nomad Residence Permit was launched in June 2021 by the Residency Malta Agency.

It enables holders to retain their current employment based in another country while legally residing in Malta. It’s open to remote workers who are third-country nationals, who would typically (but not necessarily) require a visa to travel to Malta as they come from non-EU jurisdictions.

You will need to provide the following documents:

  • Proof of €2,700 monthly salary
  • Travel document
  • Health insurance policy
  • Valid property rental or purchase agreement in Malta.

In addition, you need to belong to one of the three categories below:

  1. Be contracted to work for an employer registered in a foreign country
  2. Conduct business activities for a registered company in a foreign country as a partner/shareholder
  3. Offer contracted freelance or consulting services to clients whose permanent establishments are in a foreign country.

The permit lasts up to a year and will be renewed by the Residency Malta Agency, assuming the applicant continues to meet the set eligibility criteria. A Nomad Residence Permit holder will be considered a resident in Malta for tax purposes if they are physically present in Malta for more than 183 days in a year. However, they are not treated as an ordinary resident in Malta.

As a Nomad Residence Permit holder, you will not be subjected to Maltese income tax as long as you pay taxes elsewhere. You’ll still have to pay consumption taxes, though. The objective of the NRP was for the applicant to become a temporary resident who is not domiciled.

The Maltese digital nomad visa is only one of the 40+ digital nomad visas currently available worldwide. Check out our ultimate digital nomad visa list to know all your options.

The Malta Residence Programme

The Residence Programme targets EU, EEA, and Swiss nationals who are not permanent residents of Malta. They become tax residents and are awarded special tax status by signing up. Applicants tend to be UHNWIs in self-employment attracted by the remittance basis of Maltese taxation. It’s a tax residence by investment scheme that has cemented Malta’s reputation as the European destination of choice for entrepreneurs.

The Malta Global Residence Programme

This residence scheme accepts applications from individuals who are non-EU, non-EEA, or non-Swiss nationals who are not long-term Maltese residents. If they want to spend more than 90 days in the country, they will generally have to apply for a national visa for themselves and any accompanying family member. This involves paying a non-refundable application fee of €300.

To sign up for the MGRP, you must make a minimum annual tax commitment of €15,000 and purchase high-value property in Malta.

What do you get for such an investment? You will be able to benefit from double taxation agreements and earn a Malta residence permit and special tax status.

The Malta Retirement Programme

This is aimed at non-Maltese individuals who receive a pension as their primary source of income. Individuals under the retirement program may hold a non-executive post on the board of a Maltese resident company.

Moreover, they will be subjected to a flat 15% tax rate on non-Malta source income remitted to the country plus a €7,500 minimum tax, with an additional €500 per dependent.

The Malta Global Residence Programme offer a special tax status for successful applicants

Should You Establish Tax Residency in Malta?

If you are a resident for Maltese income tax purposes but non-domiciled, you are only subject to taxation on income and capital gains arising in Malta. Capital gains arising outside Malta do not count as taxable income. This includes foreign pensions, thanks to the Malta Retirement Programme.

Where the Malta Residence Programme is aimed at EU nationals, the Malta Global Residence Programme accepts applications from non-EU nationals. They both provide a gateway to the Maltese tax system for non-domiciled residents, where no tax is paid on foreign income remitted to Malta.

Double tax relief is available thanks to double tax treaties between Malta and different countries. These tax treaties ensure you don’t pay twice the amount of tax on the same income.

With several residency programs, a digital nomad visa, a business-friendly environment, a tax-friendly regime, and excellent living conditions, Malta is among the best EU countries for second residency or even citizenship.

Interested in accessing the European market through a tax-friendly, high-standard base like Malta? Reach out to us, and we will help you do just that.

EU, EEA, and Swiss nationals are eligible for residency after three months living in Malta

Malta Tax Residency for Nomads and Non-Doms FAQ

How Do I Become a Maltese Tax Resident?

You become a Maltese tax resident by default if you are physically present in Malta for more than 183 days a year.

Is it Easy to Get a Nomad Visa in Malta?

The Maltese digital nomad visa process is streamlined and entirely online. Eligibility criteria laid down by the Maltese government include a monthly income of at least €2,700. An additional stipulation is a private health insurance policy.

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