Malta Retirement Program: A Comprehensive Guide
What is retirement visa?
Retirement visas are a type of passive income visa that has been popular worldwide since the 1980s. Typically, they are issued to retirees who have sufficient retirement funds or stable income.
In general, global retirement visas have the following characteristics:
1. Applicant Qualifications: Typically, retirement visas require applicants to be retirees, reach a certain age, or have retirement funds.
2. Restrictions on Employment: Visa holders are usually not allowed to work locally.
3. Path to Permanent Residency: After residing in the destination country for a certain period, retirement visa holders can often apply for permanent residency or even citizenship.
If you’re interested in retirement visas or passive income visas, you might want to read our informative article: ‘Global Passive Income Visa | An Incomplete Guide‘.
Malta Retirement Program:
The Malta Retirement Program (MRP) has been running since 2012 and is open to retirees from both EU and non-EU countries. To apply for the program, you need to meet the following requirements:
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Age and Background: You must be at least 55 years old, a pensioner, in good health, and have no criminal record. You must have no intention of working in Malta and be fluent in either English or Maltese.
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Property Requirement: You must either purchase a property in Malta valued at a minimum of €275,000 (or €220,000 if in Southern Malta or Gozo) or rent a property with an annual rent of at least €9,600 (or €8,750 if in Southern Malta or Gozo).
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Income: You must be retired with an annual disposable income sufficient to support you and your family in Malta. At least 75% of this income must be from a pension and be regularly transferred to Malta. You are permitted to hold company shares or other financial assets, but you cannot hold a managerial position in a business.
While there is no specific income requirement for the Malta Retirement Visa, applicants are generally expected to pay at least €7,500 in taxes each year in Malta. For each additional dependent, the required tax payment increases by €500.
Since the income tax rate for retirees in Malta is 15%, your annual income would need to be at least €50,000 to meet the €7,500 yearly tax payment.
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Fees and Intentions: Non-EU applicants must pay a one-time administrative fee of €2,500 and must not intend to apply for Maltese citizenship within the first five years.
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Tax Residency: You are required to become a Maltese tax resident. Under Maltese law, this means you must live in Malta for at least 90 days per year and not live in any other single country for more than 183 days in a single calendar year.
In addition, as a single applicant, you must pay at least €7,500 in Maltese tax each year. For every dependent added to your application, your annual tax payment must increase by €500.
Program Benefits:
The Malta Retirement Program (MRP) offers a number of compelling benefits for retirees.:
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Tax Advantages: Participants in the retirement program enjoy a flat tax rate of just 15% on their income in Malta. What’s more, any investment income earned outside of Malta is not taxed.
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Healthcare System: Retirees can fully benefit from Malta’s excellent healthcare system, which is ranked among the best in the world.
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Schengen Zone Travel: Program participants can travel freely within the Schengen area, allowing them to stay in other member countries for up to 90 days out of every 180-day period.
Application Process:
The application for the Malta Retirement Programme cannot be done by the applicant themselves. It must be submitted through a local, licensed agent. The entire process can generally be broken down into the following steps:
1. Preparing and Submitting Your Application:
First, you’ll work with a lawyer to prepare all the required documents. Your lawyer will then submit the application to the International & Corporate Tax Unit. At this time, you will need to pay a non-refundable application fee of €2,500.
Required Documents for the Program Include:
1. Applicant Identification Documents: This includes valid passports for all primary and secondary applicants, six passport-sized photos, birth certificates, marriage certificates, and other documents proving the relationship between the primary and secondary applicants.
2. Completed Application Form: You can download and fill out the application form online.
3. Income Proof: You must provide proof of income and financial resources, including bank statements from the past six months and a pension certificate, to demonstrate that you meet the income and financial requirements for the retirement visa.
4. Proof of Health Insurance: You need to purchase health insurance that covers Malta for each primary and secondary applicant annually.
5. Medical Examination Certificate: All primary and secondary applicants must undergo a medical examination.
6. Certificate of No Criminal Record: Each adult primary and secondary applicant must provide a certificate of no criminal record from their current place of residence.
7. Proof of Residence in Malta: You need to provide an address in Malta where you can receive mail, either by renting or purchasing a property.
All documents from outside Malta must be notarized, and non-English documents must be translated into English or Maltese.
2. Background Check:
The relevant Maltese authorities will spend several months reviewing your application and personal information. During this time, you may be asked to submit more documents or attend an interview.
3. Fulfilling the Investment:
Once your preliminary application is approved, your lawyer will receive a Letter of Intent. This letter confirms that you have been granted special tax status and the right to reside in Malta under the program. After you receive a Schengen visa, you can enter Malta to fulfill the program’s obligations, such as purchasing health insurance and a qualifying property.
Once you have fulfilled all of the required obligations, the Commissioner of Revenue will issue a final Letter of Confirmation.
4. Collecting Your Residence Card:
After receiving the final confirmation letter, all applicants must travel to Malta to have their biometrics (fingerprints and photo) collected. Once your residence cards are produced, they will be mailed to your address in Malta.
The entire processing time for the Malta Retirement Programme is generally around three months.
Dependents:
For the Malta Retirement Visa, the primary applicant’s spouse, parents, and financially dependent children under 26 can also reside in Malta as secondary applicants.
Visa Validity:
The Malta Retirement Visa is valid for five years and can be continuously renewed under the original conditions upon expiration.
To be eligible to apply for Maltese citizenship, a foreigner must meet several requirements:
Residency: You must have lived legally in Malta for a total of five years. This includes two specific periods:
- You must have lived in Malta continuously for the 12 months immediately before you apply, without leaving the country.
- In the six years leading up to that 12-month period, you must have resided in Malta for at least four years in total.
Good Character: You need to be vouched for by at least two Maltese citizens who can confirm you are of good moral character.
Language: You must pass a language test in either English or Maltese.
Useful Links:
Malta Retirement Program: https://mtca.gov.mt/personal-tax/individual/special-schemes/malta-retirement-programme