Introduced by means of LN 167 of 2013, the Global Residence Programme Rules, 2013 (GRP) are aimed to attract individuals who wish to apply for a special tax status, are not nationals of the EU, EEA or Switzerland and are not long-term residents.
Individuals benefitting from this Programme are allowed to work in Malta, provided they satisfy the requisite conditions for obtaining a work permit. Beneficiaries may also have special carers providing a service in their qualifying property, as long as all the requisite procedures are satisfied.
Applicants who satisfy all the following criteria are eligible to submit an application in terms of the Global Residence Programme:
1. An individual who is not:
An applicant who has dual-citizenship i.e. having citizenship of one of the above jurisdictions and citizenship of another jurisdiction, is precluded from applying for special tax status in terms of the Global Residence Programme.
2. An individual who is not a beneficiary of any other tax scheme such as the Residents Scheme Regulations, High Net Worth Individuals Rules, Malta Retirement Programme Rules, Qualifying Employment in Innovation and Creativity Rules; or Highly Qualified Persons Rules.
However an individual may renounce the right to the benefits provided under any of the above-mentioned Rules prior to submitting an application in terms of Global Residence Programme.
3. Owns or rents a qualifying owned property or qualifying rented property which the individual occupies as his principal place of residence worldwide. The value of the property has to be as follows:
The lease needs to be taken out for not less than a twelve month period and is evidenced by a certified lease agreement. The lease agreement needs to indicate details of whether the property is being rented as furnished or otherwise. Any separate agreement relating to furnishings etc needs to be attached and the relative amounts indicated in the application form.
The final deed of purchase as well as the lease agreement, as the case may be, needs to provide full details of the vendor or lessor, as the case may be. This includes:
In both cases whether the immovable property is owned or rented, the applicant would need to declare that s/he occupies such property as his/her principal place of residence worldwide.
It is important to note that:
4. The applicant is in receipt of stable and regular resources that are sufficient to maintain himself / herself and his/her dependants without recourse to the social assistance system in Malta.
5. Is in possession of a valid travel document, certified proof of which is submitted together with the application.
6. Is in possession of sickness insurance which covers himself and his dependants in respect of all risks across the whole of the EU normally covered for Maltese nationals. The health insurance cover must be procured by a company licensed in Malta or by an international reputable health insurance company. A certified copy of the insurance policy needs to be submitted together with the application documentation.
7. The applicant needs adequately communicate in one of the official languages of Malta.
8. Is a fit and proper person.
Tax Treatment
An individual who has been granted special tax status in accordance with the GRP, hereinafter referred to as “beneficiary”, will be subject to tax at a rate of fifteen cents (0.15) on every euro thereof on any income that is received in Malta from foreign sources by the beneficiary and his/her dependants indicated below. This rate of tax will apply from the year of confirmation of the special tax status up to year of cessation of status, both years included.
Dependants who will be able to benefit from the rate of fifteen cents (0.15) on every euro are:
None of the above individuals may be beneficiaries under the Residents Scheme Regulations, High Net Worth Individuals - EU / EEA / Swiss Nationals Rules, the High Net Worth Individuals Rules - Non-EU / EEA / Swiss Nationals Rules, the Malta Retirement Programme Rules, theQualifying Employment in Innovation and Creativity Rules or the Highly Qualified Persons Rules.
Other income that is chargeable to tax in Malta in accordance with the Income Tax Acts of the beneficiary and the dependants indicated above, that is not charged to tax as separate income at the rate mentioned above, will be charged to tax at the rate of thirty-five cents (0.35) on every euro. This may include inter alia bank interest received from a local source or dividends received from a company registered in Malta.
Income that is chargeable to tax in Malta in accordance with the Income Tax Acts of the below mentioned dependants will be charged to tax separately at the applicable rates found in Article 56 of the Income Tax Act. Such dependants need to be registered for income tax purposes with the Inland Revenue Department under a separate procedure. These dependants are:
Minimum Tax
Beneficiaries of special tax status granted in terms of the Global Residence Programme will need to pay a minimum tax of fifteen thousand euro (€15,000) annually. This minimum tax covers income of the beneficiary and his / her dependants mentioned below that arises outside Malta and is received in Malta and does not include income that arises in Malta. The dependants that are referred to above are:
Such beneficiary retains the right to request a claim for relief of double taxation under Article 74 (a) and (b), Income Tax Act, provided that the minimum amount of tax payable by the beneficiary is as provided above. If the tax payable according to the tax computation (including any credit for relief of double taxation) is such that it is less than the minimum tax required to be paid as aforesaid, the amount to be paid will be the said minimum.
In the year when the special tax status is confirmed or cancelled, the minimum tax will be paid in full.
Where in the year of application special tax status is granted before 30th April, the minimum tax for the first year will be payable not later than the 30th April at the Inland Revenue Department, Floriana. Where the special tax status is granted later than 30th April, the minimum tax referred to in these rules, shall be paid before the special tax status is granted.
The confirmation of special tax status will be issued by the Commissioner subject to payment of the minimum tax within a thirty day time window. A receipt of such payment will need to be presented to the International Tax Unit so that a letter that is to be presented to the competent authority responsible for granting residence permits is issued. Such letter, together with the letter of confirmation of special tax status will be the basis on which the uniform residence permit will be issued. This procedure will need to be followed in all subsequent years during which the beneficiary remains in possession of special tax status in order for the uniform residence permit to continue to be renewed annually.
Application Fee and Authorised Registered Mandatory (ARM) Requirement
An individual, represented by an Authorised Registered Mandatory, may apply to the Commissioner for special tax status under these rules. A non-refundable administrative fee is to be paid in respect of any application for special tax status in terms of the Global Residence Programme by means of a bank draft payable to the ‘Commissioner for Revenue’. The administrative fee is that of six thousand euro (€ 6,000) except where the qualifying owned property is situated in the south of Malta, in which case the administrative fee is that of five thousand five hundred euro (€5,500). In the latter case the qualifying owned property needs to have been purchased at the time of submission of application.
We are registered and approved by the local tax authorities to act as an Authorised Registered Mandatory (ARM).
