Changes in the Highly Qualified Persons Rules for Third Country Nationals in Malta

Learn all about Malta’s tax regulations designed to attract individuals with great skill sets.

In July 2017, a legal notice was issued by the Maltese Government to provide eligibility for third-country nationals, where the latter would benefit from a tax benefit of 15% flat rate for an initial period of four years. This requires an annual income of at least eighty-two thousand eight hundred and eighty-one Euros (€82,881). This is adjusted annually in line with the Retail Price Index.

The rules are based on the fact that due to Malta’s good reputation a lot of highly qualified persons are looking for an alternative residence in Malta.

After joining the EU in 2004, Malta experienced economic growth in the sector of gaming, financial, and aerospace industries, attracting professionals.

This program was designed to attract highly qualified individuals to work in specialized sectors in Malta. Individuals who receive an employment income from an ‘eligible’ office are subject to benefit from a flat-rate tax of fifteen percent instead of the normal progressive rate of tax, with a maximum of thirty-five percent. These professionals should derive income from a Maltese employer, in the gaming sector, in the financial services sector or aviation sector and the employing companies should be licensed by the Malta Gaming Authority (MGA), the Malta Financial Services Authority (MFSA) or companies certified by Transport Malta (TM).

The reduced rate of tax applies for a consecutive period of five years for EU, EEA and Swiss nationals and for a consecutive period of four years for other nationals (third-country nationals).

The tax benefit is eligible beginning from the first year the individual is tax-liable in Malta. For EU, EEA or Swiss nationals the flat tax rate of 15% for a consecutive period of five years can be obtained after application. Upon application and submitting the mandatory documentation, a one-time extension of a further five years can be granted. In total, a qualified person from the EU, EEA or Switzerland shall be eligible for a maximum of ten years and a third-country national shall be eligible for a maximum of eight years.