Topics Covered Hide
- 1 But first, a few words about Malta…
- 2 Benefits of the global residence program Malta
- 3 Drawbacks of the global residence program Malta
- 4 Requirements to be successful in the global residence program in Malta
- 5 How to apply for the global residence program Malta
- 6 Exploring the residence programme in Malta
- 7 Considering the permanent residence programme in Malta
- 8 Tax benefits and optimization for each residence program
- 9 Conclusion
In fact, Malta is considered one of the happiest places in the world due to its high living standards and its great cultural heritage. Tax benefits are not to be overlooked either, not to mention the fact that everyone speaks English and there is a strong expat community.
Now, exploring the global residence program Malta will give you some interesting opportunities for the future, whether you are interested in tax optimization, starting a business, or perhaps relocating there as well.
But first, a few words about Malta…
Malta is an archipelago – one main island, though – in the southern part of Europe. It is part of the European Union and located just 50 miles away from Italy and about 176 miles away from Tunisia. Maltese and English are the official languages, yet most people can speak Italian too.Overall, Malta has 122 square miles and a population of about half a million people. It is one of the smallest countries in the world, yet the density is not that bad – in other words, you are less likely to feel crowded there.
The local economy is quite impressive for such a small country. The tourism industry tends to dominate because of the nice climate and plenty of UNESCO sites. Besides, Malta has seven megalithic temples, which are the oldest structures in the world.
Benefits of the global residence program Malta
The global residence program Malta is quite straightforward and provides access to the European Union market. Basically, getting a residence in Malta means you gain access to a full market – plus, the close proximity to some African countries makes it even better.Furthermore, Malta is part of the Schengen area – no borders whatsoever. There is a light restriction here, though, but it will not affect you too much. You can travel in the Schengen area for 90 days every 180 days.
Now, Malta has an impressive culture, but economic and political stability can also be considered a top priority. Believe it or not, despite its small size, Malta is the only country in the Schengen zone to maintain steady economic growth over the past decade.
In fact, Malta is also known to host some of the strongest banks in the world, and for some good reasons – no one wants instability and conflict. Opening a bank account in Malta will allow you to join this extraordinary circle.
Now, what else is Malta known for? First of all, there is universal healthcare available for free. There is no need to struggle to find private healthcare or pay a fortune – sure, there are private healthcare institutions as well, but overall, Malta has a free public system.
Education goes in the same category – locals benefit from free education, as well as free childcare. If you think about it, what could be better than focusing on your business and entrepreneurial ventures while your children benefit from top-notch childcare?
As if all these were not enough, you have Malta's unique tourism industry. There are lots of beaches around the island, and plenty of green and recreational areas. It is never too hot or too cold, and quality of life simply stands out in the crowd.
The program covers more than just applicants – Malta is not a playground for the rich, but an environment to grow your family. Dependents are also included and will include the spouse or partner, as well as unmarried children of any age. Dependent parents and grandparents can go on the application too.
Unlike other countries offering such programs, Malta will give you the right to reside in the country forever. There are no limitations and no need to renew the permit. Once in there, assuming that you want a job rather than start a business, you have the opportunity to apply for a work permit too.
You can establish a business and benefit from the rules of a tax efficient jurisdiction, but you can also apply for citizenship after being a resident for five years. There are no requirements in terms of language, education, or work experience.
Drawbacks of the global residence program Malta
Malta is one of the most appreciated countries in Europe and can definitely come with some incredible benefits. It offers the perfect environment to many, but it is not perfect – here are some of the potential drawbacks.First of all, the global residence program Malta is not for everyone. It requires some heavy investments. All residence programs follow the same rules – you need good capital first, but you will obviously get some advantages in return.
Considering all the property costs or rental prices and the fees involved, you will need a solid investment.
Then, unlike other similar programs, this one is basically a commitment. Some residence programs require you to visit the country once or twice a year. Some others come with no requirements at all – you do not even need to visit the country.
Malta is quite strict. To qualify for the residency, you need to spend 183 days a year in the country.
Interested in citizenship in the long run? There is just as much hassle. The process takes time. Besides, it has a solid drawback for those who choose Malta for tax optimization. Once you become a citizen, you are no longer under a special tax status, so your international income will be taxed.
Then, why was Malta so popular in the past? Easy – stacked programs. Years ago, you could stack multiple tax benefits from more residency programs in the country. You could get one benefit over the other, meaning you could reduce your taxes to a minimum.
Those days are long gone. You can now choose one program or the other, based on your current nationality and eligibility criteria. However, at times, you may quit one program and join another one if you actually qualify.
Requirements to be successful in the global residence program in Malta
Just like any other residence program, Malta has its own requirements, whether they refer to your nationality, current status, or capital. Here is everything you need to know to determine if you can qualify for this program.First of all, you need to be a non-EU citizen. Basically, if you are from the European Union, you will be able to go and live in Malta anyway, so the program applies to those who are not part of the big European family.
In terms of age requirements, the applicant must be at least 18 years old. There are some qualifying investment requirements, too, and these investments must be held for five years or more – if they imply real estate.
Just like any other country out there, Malta does not want to welcome criminals within its borders. You need to come up with a paper from the police claiming that you have a clean criminal record. As for health and safety, you need to get global health insurance coverage – obviously, you must be in good health too.
Despite being considered a good option in terms of tax optimization, authorities in Malta will check your money before approving your application. You must bring in evidence regarding the funds of your money – especially the money used for the application, including the investment.
You require enough financial resources to support yourself in Malta, and you need to provide proof of assets worth €500,000 or more. From all these assets, €150,000 or more must be invested in financial assets.
How to apply for the global residence program Malta
Get all the documents you need first. The application is available online. You need to complete every single detail on it and submit it. Sign it first – as for the submission, it goes to the Commissioner for Revenue.You will need an ARM for this application. Basically, you cannot do everything yourself – chances are you will make mistakes anyway. This is a legal company or professional who has the right to deal with such things and represent you accordingly.
The application will cost you €4,000. This is only to submit it. Keep in mind that even if you get rejected, this tax is not refundable. If you do get accepted, you will need to pay €2,000 more when you begin your residence. The fee can go down to €1,500 if you have chosen residence in the southern part of Malta.
At this point, authorities will review the application and check all the documentation. The progress will be sent to the ARM every now and then, as well as the final outcome. If accepted, the application will lead to a due diligence process – again, the ARM will be informed.
Assuming everything is correct, and there are no reasons to be rejected, your application will be accepted. You will then get a confirmation letter. The process is relatively fast and will bring you to the European Union in less than three months.
The global residence program Malta is definitely a good opportunity for relatively wealthy individuals coming from outside the European Union. It is a solid country providing excellent opportunities and access to a wide market.
However, on the same note, the global residence program Malta is not the only such program in the country. In fact, this is only aimed at those who are not part of the European Union. There are a few other options out there, and they are also worth some attention.
Exploring the residence programme in Malta
Often referred to as the TRP – The Residence Programme, this option is suitable for most Europeans. Basically, to apply for this program you must be an EU or EEA national. Nationals from Iceland, Switzerland, Liechtenstein, and Norway are also accepted.Taking tax residence in Malta will inevitably allow you to benefit from regular residence too. If you are interested in living on a beautiful island and enjoying professional tax optimization, this program is for you. Sure, EU nationals can go and live in Malta anyway, but this is more about tax residency.
Requirements are mild – apart from your nationality, you need to ensure you have the financial resources to support yourself. Relying on the social assistance program in Malta is not allowed, so you need some money.
Other than that, your travel documents must be valid, and you obviously need health insurance. You must be in good health and be able to communicate in an official language – Maltese or English. For the residence to be valid, you must spend 183 days or more in Malta over a year.
Where are you going to live? This is the main aspect of this residency – getting a property. You are not allowed to let or sublet it. If you buy one, it should cost €275,000 – however, the southern part of Malta and Gozo come with a lower requirement of €220,000.
You do not necessarily have to buy – you can also rent a property for a year. It has to cost €9,600 or €8,750 for the south and Gozo. The price is given for a year, though, so it is not too bad. You can submit such documentation later.
Family members can be included on your application too. Feel free to include your spouse, as well as children – including adopted children or in your custody – who are unable to support themselves. Basically, you can bring in your whole family.
Again, to submit the application, you will need an ARM. The nonrefundable fee goes up to €6,000 or €5,500 for the southern part of the country. The process is just like the one for the global residence program Malta – application, due diligence process, and a letter of confirmation.
Those who get accepted will also be able to apply for permanent residence straight away.
Considering the permanent residence programme in Malta
This program has been launched in 2021. The MPRP – just like the global residence program Malta – is aimed at those out of the European Union, as well as their families. Perks are similar – access to the EU, the Schengen area, jobs, and indefinite stay in Malta.Unlike the global residence program Malta, this alternative does not have minimum stay requirements. In other words, you can come and go as you please. But then, there is a catch – you must renew this permit on a yearly basis.
In terms of requirements, they are straightforward. You must be at least 18 and have non-EU citizenship. Whether you have funds or you get a job, you must maintain your finances at a stable level in order to support yourself.
Get clearance from the local police, too, and show it as evidence – if you have a criminal record, it is not worth wasting your money with the application. Then, there is also the capital requirement – minimum €500,000, with €150,000 or more invested in financial assets.
Then, you have the standard requirements. You must have a valid passport and get a health insurance policy. The due diligence test is time-consuming and will spread over four tiers. Then, you have to buy or rent a property too.
Interested in relocating to Malta? Purchasing a home is a better choice – €350,000 minimum investment or €300,000 in the south. Should you decide to rent, you must pay €10,000 for the south and €12,000 for the rest of the country. You need to hold this property for about five years.
As if all these were not enough, there is a €2,000 NGO donation requirement.
Just like for the global residence program Malta, you can take your partner or spouse, parents, grandparents, and unmarried children who are financially dependent. Simply put, your whole family can come over.
Again, you will need a law firm to handle the process because authorities will not deal with you in person – more expensive, but this is the best way to avoid potential mistakes and find some guidance. The application must be submitted with a nonrefundable fee of €10,000.
It takes up to six months to complete the application and handle the diligence test. Once you are approved, you will need to pay the remaining fee – another €30,000. Then, get a property and pay the donation.
Keep in mind that additional fees will apply for each family member.
This program will lead to citizenship. You can get citizenship by investment too.
Tax benefits and optimization for each residence program
Some people choose Malta for access to the EU and the Schengen area. Some others see it as a stable and safe place to raise a family and build a business. But then, the tax optimization is not to be overlooked either – this is one of the reasons wherefore so many wealthy people choose Malta.Before digging deeper, it is worth noting that different residence programs will give you different opportunities and tax benefits. The global residence program Malta is one of the easiest options for those coming from outside the EU.
If you get to qualify for this program, you will become a long-term resident of the country, and fortunately, there will be plenty of advantages in the process. The best part in the process? Malta will not tax you for internationally sourced income.
Basically, you can move to Malta and run a business abroad – such as an online business, for example. If the money is not sourced locally, there is no income tax. Even if you source your income locally, the tax is still acceptable – 15%, which is less than other countries in Europe.
The global residence program Malta will also help you avoid inheritance taxes – no such things in Malta. Capital gains are not taxed either, but only if they are foreign sourced. Even if the money is remitted to Malta, there will be no tax. Local investments will be taxed at 35%, though.
It is worth noting that a yearly tax of €15,000 or more must be paid. It can come from the remitted income – the 15% – or other taxes. Even if your taxes do not come up as €15,000, you will need to pay the rest in order to retain the residency. This tax covers everyone on your application.
Another issue is that this tax must be paid upfront in the first year. Later on, it becomes easier because you have some income. But to get all the special tax status benefits, you will have to pay this tax first – basically, it comes before you actually start making money.
Taxes are similar for those who apply for the TRP – The Residence Programme – too. Once you are granted the special tax status, you will pay 15% on internationally earned income remitted to Malta, as well as 35% on the local income. The same rule applies to those who depend on you.
A €15,000 payment is also required – it could be higher. It is for the income earned in other countries, even in the first and last year. Basically, you will pay this tax in the year you are given the special tax status, as well as in the year it is canceled – if you decide to leave, of course.
Conclusion
As a short final conclusion, the global residence program Malta is the preferred option for those coming from outside the EU. It offers a plethora of benefits, but it is not for everyone – it comes with significant expenses as well, so it is mostly aimed at wealthy people.Apart from this particular program, there are a few other alternatives – some of them suitable for EU citizens, while others are aimed at the ones out of the EU. Each program has its own specifications and criteria – besides, there are different rules that may or may not benefit you.
What works for some people will not work for everyone else, though. Some programs may seem more attractive than others, but at the end of the day, you need to consider your personal needs and make a decision in that direction.
