Click here to view the August newsletter
Malta remains a leading destination for globally mobile individuals, offering various residency pathways with favorable taxation. All of these frameworks operate on a remittance basis of taxation, meaning foreign income is only taxed if remitted to Malta. However, each program has its own structure, eligibility rules, and obligations.
This article compares the tax implications under the following categories:
- Malta Permanent Residence Programme (MPRP) – updated as of 2025 – for non-EU/EEA/Swiss nationals
- Tax Residence Programme – for EU and non-EU/EEA/Swiss nationals
- Ordinary Non-Dom Residence – available only to EU/EEA/Swiss nationals
1. Malta Permanent Residence Programme (MPRP) – 2025 Reforms
Who it’s for: Non-EU nationals applying for permanent residency in Malta.
Key 2025 Changes (Legal Notice 146 of 2025):
- A one-year Temporary Residence Permit is issued upon successful background checks (prior to final approval).
- A unified government contribution of €37,000, applicable regardless of whether the applicant rents or purchases property.
- Greater property usage flexibility:
- Owners may lease out qualifying property while abroad.
- Tenants may sublet after 5 years (with landlord’s consent).
Taxation:
- MPRP does not automatically grant tax residency.
- If tax residency is established (e.g., spending 183+ days in Malta), the remittance basis applies:
- Foreign income is taxed only when remitted.
- Foreign capital gains are exempt, even if remitted.
- Local income is fully taxable.
Minimum Tax:
- No fixed minimum tax under MPRP alone.
- General remittance rules apply for tax residents.
2. Tax Residence Programme
For EU & Non-EU/EEA/Swiss Nationals
Taxation:
- 15% flat rate on foreign income remitted to Malta.
- Foreign capital gains are exempt.
- Local income is taxed at standard progressive rates.
Minimum Tax:
- €15,000 per year, covering the applicant and dependents.
3. Ordinary Residence (Non-Domiciled)
Available only to EU/EEA/Swiss Nationals
Who it’s for: EU/EEA/Swiss citizens residing in Malta who are not domiciled there and are not part of a special tax programme.
Taxation:
- Remittance basis applies:
- Foreign income is taxed only if remitted.
- Foreign capital gains are exempt, even if remitted.
- Maltese-source income is taxable at standard rates.
Minimum Tax:
- If total income exceeds €35,000 per year, a €5,000 minimum tax applies.
- This does not apply to individuals under Tax Residency programme.
Comparative Table
| MPRP 2025 (Non-EU) | Tax Residency (EU & non-EU) | Ordinary Non-Dom (EU/EEA/Swiss Only) | |
|---|---|---|---|
| Residency Status | Permanent (non-tax by default) | Tax Residency | Tax Residency |
| Tax Basis | Remittance (if resident) | Remittance | Remittance |
| Foreign Income Taxed | Only if remitted | 15% if remitted | Progressive rates if remitted |
| Foreign Capital Gains | Not taxed | Not taxed | Not taxed |
| Local Income | Taxable | Taxable | Taxable |
| Minimum Tax | None | €15,000 | €5,000 (if income > €35k) |
| Property Usage | May rent/sublet | Personal use | Personal use |
| Eligibility | Non-EU nationals | EU /Non-EU nationals | EU/EEA/Swiss nationals only |
The 2025 MPRP reforms significantly improve Malta’s permanent residence offering, particularly through simplified contributions, the introduction of a temporary permit, and relaxed property usage rules. While MPRP does not automatically trigger tax residency, those who qualify enjoy the same remittance-based tax treatment available to other non-domiciled residents.
Malta continues to attract individuals seeking legal EU residency with smart tax structuring. Choosing between MPRP, Tax Residency, or Ordinary Non-Dom depends on your citizenship, income type, and personal objectives. Professional advice is strongly recommended to ensure optimal residency and tax outcomes.
Click here to view the August newsletter
