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ordinarily resident & permanently resident

No, really... it does!
But does it matter more in Malta than at home?

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ordinarily resident & permanently resident

Postby raph » Sun 15 Oct 2006 15:31 GMT

RESIDENCE IN MALTA - Tax advantages in the sun

Malta has two most attractive residency schemes which are probably the most advantageous schemes available throughout the European Union for persons wishing to change their tax residence. Moving your residence from a high-tax country to Malta could make you huge savings on your tax liabilities. The Malta Residence Schemes are open to European Union nationals and even non-EU nationals without distinction and the Scheme of your choice will depend on your particular circumstances.

Ordinary residence (available only to EU nationals)

No minimum residence stay requirement - you may even not spend any time in Malta
No minimum annual tax

I found the above info via Google. seems to sum up the situation quite nicely...
raph
No tax on your world wide wealth
No tax on your world wide income which is not remitted to Malta
No property purchase required; you must only spend Lm1,800 per year as rental
No investment required
No Inheritance Tax or Wealth Tax
Easy qualification requirements
Fast one-day processing
Low tax rates on remitted income
Permanent residence (available to all nationalities)

No minimum residence stay requirement - you may even not spend any time in Malta
Minimum annual tax of just Lm 1,800 (Eur 4,200)
No tax on your world wide wealth
No tax on your world wide income which is not remitted to Malta
No property purchase required; you must only spend Lm1,800 per year as rental
No investment required
No Inheritance Tax or Wealth Tax
Easy qualification requirements
Fixed tax at 15% on remitted income (minimum as above)
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raph
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Postby peterj » Mon 16 Oct 2006 16:22 GMT

I'm fairly sure that the "Ordinary Residence" talked about is a "Residence Permit (EU/EEA nationals)"

If this is so, I am 99% certain that there is no minimum property rental or purchase conditions. It's not mentioned on the application form, or official list of required documentation, and elsewhare on what I think is the webpage this was copied from it even states that there is "There is no minimum or maximum value on the property being rented or bought though in practice the same minimums as for Permanent Residents will apply".

I think that they may by suggesting, as was suggested to me by one immigration consultant (possibly from the same firm I'm not 100% sure) last year, that you won't be able to find any property cheaper than the Permanent Residence scheme minimums. Unless your tastes are reletively upmarket, this is definitely not true.

"Fast one day processing" and "no minimum stay requirements" is at odds with advice from the Immigration Office. They tell me that they will not accept applications until you have been resident 3 months, and "recommend that you don't apply until you have been here for at least 6 months". Whilst they will provide evidence that an "Ordinary Residence" application has been made, "The residence permit will be issued not later than 6 months from the date of stamp" ie date application is lodged. I doubt that proof of application will provide folks seeking to prove Maltese Residence to their home tax office with much comfort.

Maybe they have some special service deal with the Immigration Police though.

If there is yet another type of Residence now available, and this is what is being described, I'd be interested to know.
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Postby adrianocefai » Sun 18 Sep 2011 11:48 GMT

The Malta Permanent Resident Scheme, which was suspended at the beginning of 2011, was finally replaced by a new scheme earlier this week. The new scheme was officially launched by Malta‘s ministry of finance and seeks to attract high net worth individuals to take up residence in Malta.

It is understood that the new scheme is similar in scope to the Permanent Resident Scheme (PRS) it replaces such that individuals eligible to benefit under the new scheme would be taxable in Malta on foreign source income which is received in Malta at the favourable flat rate of 15% (such persons are not chargeable to tax in Malta on foreign source capital gains). Local source income and gains would be taxable in Malta at the higher rate of 35%.

Still, eligibility criteria and ongoing requirements have been enhanced and heightened, particularly in respect of non-EU/EEA/Swiss nationals.
Eligible individuals (HNWI) shall be required to acquire qualifying immovable property in Malta having a value of not less than €400,000 or to otherwise procure such qualifying immovable property under a lease agreement against aggregate rental consideration of not less than €20,000 per annum.

The qualifying immovable property must represent the applicant and his/her family‘s principal place of residence. Eligible individuals shall also be required to be in possession of appropriate health insurance and will be subject to a rigorous fit and proper test.

It is also understood that, on an ongoing basis once an application is accepted, beneficiaries under the scheme would be required to, inter alia, reside in Malta for a minimum of 90 days per annum and not stay in any other jurisdiction for more than 183 days (becoming tax resident therein). In addition, a minimum amount of €20,000 (plus €2,500 per dependant) would be payable by way of tax in Malta per annum by a beneficiary under the scheme. The said minimum amounts of Malta tax payable are increased in respect of non-EU/EEA/Swiss nationals to €25,000 (plus €5,000 per dependant) whilst further requirements apply in respect of such nationals seeking to establish or who are long-term residents in Malta.

Significantly, it is understood that individuals currently in possession of Permanent Residents Permits (under the now suspended Permanent Residents Scheme) shall continue to benefit under that scheme although, going forward, such persons shall additionally be required to:

-be in receipt of stable and regular resources which are sufficient to maintain him/herself and his/her dependents without recourse to the social assistance system in Malta; be in possession of sickness insurance in respect of all risks normally covered for Maltese nationals for him/herself and the members of his/her family.

In addition, the property declared as the Permanent Resident Permit holder‘s place of residence cannot be occupied by any person other than the holder of the certificate and his/her family members. Furthermore, should the permit holder transfer that property, s/he would be required to acquire a new property having a value at least equal to the minimum value prescribed under the new scheme in respect of qualifying immovable property.

Finally, any individual who applied for a Permanent Resident Permit (under the now suspended Permanent Residents Scheme) prior to 14 September, 2011, but who was not issued with such a permit before 1 January, 2011, would be entitled to apply to benefit under the new scheme – should s/he satisfy the eligibility criteria prescribed under the new scheme. Property purchased prior to 14 September, 2011, by any such person for a consideration of not less than €116,000 shall still be treated as a qualifying immovable property for the purposes of the new scheme.
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