Malta's nomad residency - a Mediterranean home for globe trotters

Introducing the Nomad Residence Programme

In December 2023, the Maltese Government introduced the ‘Nomad Residence Permits (Income Tax) Rules 2023’ to regulate and clarify the tax obligations of Nomad Residence Permit holders. According to these rules, permit holders are eligible for a 12-month income tax exemption, commencing from the date of issuance of the Nomad Residence Permit or January 1, 2024, whichever is later. To avail this exemption, applicants are required to submit a written declaration to the Residency Malta Agency, affirming that their residence over the past year is not merely temporary.

Following the initial exemption period, these individuals will be subject to a reduced income tax rate of 10% on their income earned from ‘authorised work’, regardless of whether this income is remitted to Malta. This is because such work is deemed to have been performed in Malta. Any other income not derived from authorised work and taxable in Malta will be considered as the second component of the individual’s total taxable income and will be taxed under the standard provisions of the Income Tax Act.

‘Authorised work’ refers to services provided by a main applicant in line with an employment contract with a non-resident employer who does not operate a business in Malta through a fixed place of business, or work performed on a self-employed basis for clients who do not reside in Malta, provided via telecommunications technology. Any additional income not derived from authorised employment, such as dividends and interest, will be subject to the general taxation rules stipulated in Malta’s Income Tax Act.

The Rules also stipulate reporting requirements for nomad residence permit holders earning income from authorised work. Digital nomads are required to register for tax purposes, declare their taxable income in Malta from authorised work or other income taxable in Malta, file an annual income tax return, and make the necessary tax payments. Digital Nomads can also avail double taxation relief under Malta’s double tax treaties. In such cases, individuals could be exempt from the 10% income tax in Malta if they can demonstrate that they paid taxes at a rate of at least 10% on their income outside of Malta.

Embrace the Freedom of Remote Work with Malta's Nomad Residence Programme

Unlock a world of possibilities with Malta's Nomad Residence Programme! This innovative initiative allows foreign nationals to legally live and work in Malta, all while maintaining their employment abroad or offering services to clients in another country. If you have the flexibility to work remotely and the desire for a Mediterranean lifestyle, this program is tailor-made for you.

Key Benefits:

• Global Mobility: Work seamlessly from Malta using telecommunications technologies while enjoying the picturesque surroundings of the Mediterranean.
• Tax Advantages: The 'Nomad Residence Permits (Income Tax) Rules 2023' provide an attractive 12-month income tax exemption for permit holders. Following this, a reduced income tax rate of just 10% is applied to income earned from 'authorised work.'
• Simple Compliance: The application process is streamlined, and to avail the income tax exemption, a straightforward written declaration is required, affirming the non-temporary nature of your residence.

What You Need to Know

• Exemption Period: Enjoy a 12-month income tax exemption starting from the date of your Nomad Residence Permit issuance or January 1, 2024, whichever is later.
• Reduced Tax Rate: After the initial exemption, a low 10% income tax rate applies to income from 'authorised work,' whether remitted to Malta or not.
• Authorised Work Definition: Engage in employment with a non-resident employer or provide services to non-resident clients through telecommunications technology.
• Tax Reporting: Fulfil reporting requirements by registering for tax purposes, declaring your taxable income in Malta, filing an annual income tax return, and making necessary tax payments.
• Double Taxation Relief: Leverage Malta's double tax treaties for potential relief. If you can demonstrate payment of taxes at a rate of at least 10% on income outside Malta, you could be exempt from the 10% income tax in Malta.

How We Can Help You

Embarking on the Nomad Residence Programme in Malta? Seize the opportunity to live and work in Malta with ease. Let us be your guide in making this journey seamless and tax-efficient. Our advisory services are designed to ensure you maximize the benefits of this unique opportunity.  Contact us today to embark on your journey or read more about our Nomad Residence Programme Services.