Malta will give you a golden visa with permanent residency rights in the schengen area, if you buy a property for €300,000 in Malta. This new option was introduced in the Maltese permanent residency scheme (aka golden visa) which will open from March 29, 2021.

Malta has the most attractive real estate market in the EU for a solid investment.  Price hikes continue in Maltese islands with increasing demand for residential properties despite Covid effect on the property market.

The Government has introduced massive tax cuts to reinvigorate the real estate market for foreigners who are first time buyers. The average price of properties are around €200,000 for a studio.

Why Malta?

  • Geographically located at close proximity to Africa, Middle east and Europe
  • Climate Hot and dry summers, warm and sporadically wet autumns, and short, cool winters
  • Mediterranean nation with an English-speaking population.
  • EU membership and schengen area
  • Permanent residency for all family members upto fourth generation.
  • Path to EU citizenship for property owners
  • Very low property taxes and high rental yields

How much it will cost?

First you must prove that you have €500,000 in total net assets to apply for this program. We have broken down the total costs in four sections.

Real estate

  • €300,000 Property in the South of Malta OR €350,000 Property

Government fee

  • €68,000 Government contribution and administration fee;
  • €2,000 Philanthropic donation

Family members costs:

  • Parents-in-law & grandparents – €7,500 per capita;
  • Spouse of an already approved main applicant – €7,500;
  • Child 18+ of an already approved main applicant – €5,000;
  • Minor child of an already approved dependent child/or of an already approved spouse – €5,000;

Additional

  • Health insurance
  • Lawyer and agency fee

Best locations for buying property

Malta consists of three inhabited islands (Malta, Gozo, and Comino) and a number of smaller uninhabited islands just south of Sicily.  These are the prime locations to buy Malta if you are after higher rental income – A region with highest rental yields 50% more than the C region.

  • Region A (Sliema, St. Julian’s, Gzira and Valletta)
  • Region B (Mellieha, St. Paul’s Bay, Qawra and Bugibba)
  • Region C (Vittorio- sa, Senglea, Cospicua and Marsascala)

Property Taxes

The legal system of Malta does not impose a tax on ownership of property. The property tax structure is very simple.

There are no VAT implications on the purchase or sale of any immovable property situated in Malta or Gozo however the property is subject to Stamp Duty which is payable by the purchaser.

  • (Seller) Withholding tax – 5% (reduced due to Covid) paid 1% during initial sale agreement and 4% during final transfer
  • (Buyer) Stamp duty – 1.5% on first 400K euro

First-time buyers of immovable property will now be exempt from stamp duty on the first €200,000 of the value of the property (previously €175,000). For sale of property in Gozo, there is a reduced rate on stamp duty of 2%, instead of standard rate of 5%.

This is applicable to promises of sale being signed until March 2021 with the final deed of transfer being signed until 31 December 2021.

Budget 2021

The 2021 Budget introduced schemes entailing a reduction in stamp duty for First Time Buyers; that for Second Time Buyers; the scheme for the purchase of vacant properties in Urban Conservation Areas (UCA); that for the purchase of property in Gozo; as well as the refund schemes for restoration expenses

First Time Buyers will be exempt from stamp duty on the first two hundred thousand euro (€200,000) rather than on the first one hundred seventy five thousand euro (€175,000). I am also announcing that the reduced rate of 3.5 per cent in the case of acquisition of one’s own residential property, even if not a first time buyer, and in the case of inheritance of the property in which one already resides, will also now apply on the first two hundred thousand euro (€200,000).

stamp duty on property acquisition was reduced from five per cent (5%) to one point five per cent (1.5%) on the first four hundred thousand euro (€400,000) of the property value, as well as the reduction in the capital gains tax payable by the seller from eight per cent (8%) to five per cent (5%), will remain in force. This applies to promise of sale agreements registered up to 31 March 2021 as long as the contract is entered into by not later than 31 December 2021.

tax-exempt amount applicable when a property is donated by parents to their 27 children, where the property is to be used by the children as their residence. Such amount will increase from two hundred thousand euro (€200,000) to two hundred fifty thousand euro (€250,000). Any additional property value over and above will continue being taxed at 3.5 per cent

From 1 January until 31 December of next year, the final tax rate of 15 per cent payable on profits or gains from the assignment of any rights acquired in terms of a promise of sale (konvenju) will be extended to apply to the entire amount. Over this period the performance of this measure will be evaluated before deciding on its future.

Inheritance

Causa Mortis relates to the succession of immovable property from a deceased person. The basic rate of duty is 5% on the market value of the property as on date of death.  A reduced rate of 3.5% on the first €175,000 of the value applies for those inheriting a property which is already being used as their sole residence.  There are other exemptions such as when the surviving spouse inherits the share of the deceased spouse of their sole residence.  The children are also exempt from duty when they inherit the residence of their parents.

This is applicable to immovable property situated in Malta, irrespective of the place of residence and nationality of the heirs.

Rental Income

The tax on income from rented properties reduced to a flat rate of 15% for both residential and commercial properties. The average rental income from properties is about 6.5%.