The Global Residence Programme (GRP) was set up to allow individuals who are not nationals of the EU, EEA or Switzerland, to benefit from a residence permit once they buy or rent property in Malta and direct their income to Malta. Individuals who wish to avail themselves of this opportunity must apply to benefit from a special tax status under the Global Residence Programme Rules [S.L.123.148].
In order to apply for benefits under the GRP tax programme, the individual must first satisfy a number of criteria. Apart from being a non EU, EAA or Switzerland national, s/he must not already be a beneficiary under one of Malta’s other tax programmes (E.g. the Residents Scheme Regulations, High Net Worth Individual Rules, Highly Qualified Persons Rules etc) and not intend to apply for long-term residence status in terms of the Status of Long-term Residents (Third Country Nationals) Regulations. However, the individual may choose to renounce to the right to benefits provided under any of the other rules or regulations before submitting an application in terms of the GRP.
Furthermore, the applicant must own or rent property in Malta, and declare that s/he occupies that property as his/her principal place of residence worldwide. If the individual opts to purchase property on the island, the value of the immovable property bought by the foreigner must be at least €275,000 if the immovable property is situated other than in the south of Malta and at least €220,000 if property is situated in the south of Malta or Gozo. The GRP rules list the localities that are considered to be in the south of Malta for these purposes.
If the foreign individual opts to rent property instead, the immovable property situated other than in the south of Malta must be rented on an annual basis of €9,600, and €8,750 if situated in the south of Malta or Gozo.
Apart from the above mentioned requirements, an applicant must have a stable and sufficient income in order to maintain himself and his dependents without any recourse to the Maltese social assistance system. He must also be in possession of a valid travel document and sickness insurance procured by a company licensed in Malta or by an international reputable health insurance company which covers himself and his dependents in respect of all risks across the EU. He must be able to adequately communicate in either Maltese or English and needs to submit a police conduct certificate which certifies him to be a fit and proper person. A non-refundable administrative fee of €6,000 (or €5,500 in the case of applications involving properties situated in the south of Malta or Gozo) needs to be paid in respect of the application for special tax status in terms of the GRP.
Once the special tax status has been acquired in accordance with the GRP, the person is deemed to be resident in Malta for tax purposes (such person hereinafter referred to as the “beneficiary”) and is chargeable to tax on his/her income. Foreign source income, which is received in Malta is taxable at the rate of 15% with the possibility of claiming double tax relief, but subject to a minimum annual tax liability. Dependents who will be able to benefit from the rate of 15% include the beneficiary’s spouse, minor children and children, who although are not minors, are in the care and custody of the beneficiary or his/her spouse as they are unable to maintain themselves due to illness or a serious disability.
The minimum tax liability of the beneficiary is €15,000 per annum, which must be paid by no later than the 30th April of the year in which the income is received in Malta, and such payment must be accompanied by a return made to the local tax authorities which provides proof that all the requirements to benefit under GRP rules continue to be satisfied. Other income which is not covered by the GRP rules is then charged at the rate of 35% in accordance with the Income Tax Acts. Furthermore, unlike the Malta Residence and Visa Programme, which is also aimed at non EU, EAA or Switzerland nationals, there is no minimum annual income which must be respected, no minimum investment requirement, and no financial contribution paid to Identity Malta under the GRP.
Beneficiaries of the GRP have no minimum stay requirements, however, they may not spend more than 183 days in any other jurisdiction. Furthermore, individuals benefitting from this Programme are not precluded from working in Malta, provided they satisfy the requisite conditions for obtaining a work permit.
An application for obtaining a special tax status in terms of the Global Residence Programme may only be submitted to the local tax authorities by an Authorised Registered Mandatory, registered to act as such with the Inland Revenue Department. CC legal is registered as an Authorised Registered Mandatory with the local tax authorities .