Acquiring Maltese Citizenship By Investment:
Malta Individual Investor Programme
The Individual Investor Programme of the Republic of Malta (IIP), by virtue of Legal Notice 47 of 2014, allows for the granting of citizenship by a certificate of naturalisation to individuals and their families who contribute to the economic and social development of Malta. Subject to a stringent vetting and diligence process, including thorough background checks, the applicants and their dependents are granted citizenship in exchange for such contribution.
To qualify for citizenship, the main applicant must be at least 18 years of age, provide proof of having been a resident of Malta for a period of 12 months preceding the issuing of a certificate of naturalisation and meet the following investment requirements:
The acquisition of real estate with a minimum value of EUR 350,000 to be held for at least 5 years or lease a residential immovable property in Malta for a period of 5 years, at an annual rent of at least EUR 16,000;
Make a contribution of a 650,000, for the main applicant, to the National Development and Social Fund. Any other dependants also need to make a contribution depending on their status;
An investment in stocks, bonds or special purpose vehicles to be identified by Identity Malta, for a minimum value of EUR 150,000 to be held for a minimum period of 5 years.
Other processing and due diligence fees apply on a case by case basis.
Applicants must have a Global Health Insurance coverage for at least EUR 50,000 for the main applicant and each of the dependants and must give proof that they can maintain the same for an indefinite period.
Taxation in Malta
A Maltese company is subject to tax on its profits at the rate of 35%. When the company pays a dividend to its shareholder, no withholding tax or further tax is due on the dividend since Malta operates the full imputation system. The tax refund system is applicable upon a distribution of profits.
The shareholders of a Maltese company may claim a refund of part of the tax, and in some cases all of the tax, paid at corporate level out of profits which are not derived from immovable property situated in Malta.
The extent of the refund depends on the nature and source of profits. The law provides for 4 types of refunds depending on the nature of the profits:
- 6/7ths refund: refund of 30% of 35% tax producing a tax liability of 5% TYPICALLY DUE ON TRADING PROFITS;
- 5/7ths refund: refund of 25% of 35% due in respect of profits earned on passive interest & royalties, thus REDUCING THE TAX LIABILITY TO 10%;
- 2/3rds refund: refund claimed where the company has claimed double taxation relief;
- 100% refund due where the profits derive from a Participating Holding (profits received from equity shares held by a Maltese company in a foreign company), thus REDUCING THE TAX LIABILITY TO 0%;