Without doubt, Malta continues to be a popular tourist destination. However, its remarkable resilience and growing economy, despite an uncertain financial climate over recent years, has increased its popularity among high net worth individuals.
In addition to the potential tax planning benefits available to those who establish or relocate their business there, Malta offers a good quality of life, excellent healthcare and great education opportunities for children; all amid an economically and politically stable jurisdiction.
Furthermore, many have also come to acknowledge the property investment opportunities.
Malta’s property market has become ever more attractive to those interested in property investment. But why is this?
Maltese property has been appreciating at well above the EU average for a number of years, resulting in rising property prices, a strong rental market and a continued demand for property.
The purchase process in Malta is easy and painless and with modern computerised Land Registry records, title disputes and post-purchase planning problems are much rarer than many other southern European locations.
A Maltese property structure can also be subject to attractive tax arrangements. Malta has no real estate taxes such as council tax or rates, nor does it have any wealth taxes. Having no succession taxes is an attractive benefit for HNWIs who are planning to leave their wealth to their families when they die.
It does have an acquisition tax, albeit just 5% on the higher of the market value of the immovable property or the purchase price; however, for a high value property this can still be significant relative to the cost of acquiring and holding the property via a trust. The use of a trust can also offer other non-tax advantages, i.e. for succession planning, as the property does not form part of an individual’s personal estate.
Malta tax is only payable on the final sale of a property. As above there is an acquisition tax but there is a Capital Gains Tax exemption worthy of note, which is available on the sale of a main residence.
For rental properties (residential or commercial), Malta also offers an optional special 15% tax rate for rental income.
Malta’s property market has not suffered the instability other European markets have; as such its stability together with its low interest rates has made for a cost-effective way for investors to acquire a high value portfolio.
So, whilst investing in Maltese property may make good business sense, it also offers an array of benefits on a lifestyle level. With an average of more than 8 hours of sunshine a day, crystal blue waters and a typical Mediterranean climate, Malta is a safe and resilient jurisdiction. It is home to a stable political environment and a growing economy, and is a regional hub and centre of excellence across many business sectors; it is one of Europe’s leading financial centres.
Its’ business-friendly and economically stable environment remains focussed on doing business and with close proximity to nearby markets in Europe, North Africa and the Middle East, it offers foreign investors a number of opportunities and benefits.
To this end, not only does it make great financial sense as an investment opportunity – it’s an opportunity for applicants and their families to enjoy a home from home in a safe and stable jurisdiction difficult to beat by many others.
Over the last 35 years, we have implemented a variety of property solutions, every one different in its complexity but each designed to meet the individual objectives and requirements of the client.
During this time we have developed a wealth of experience and understanding in the acquisitions, maintenance, redevelopment and sale of a broad range of property types worldwide, including: serviced apartments, hotels, office buildings, student accommodation, offices, care homes and residential developments.
Working closely with specialist property investment and management companies, professional advisors and a client’s chosen representatives, we look to identify and maximise property development opportunities and to provide our clients with a tailored solution complemented by a range of support services, to ensure that each client’s structure is effective and runs efficiently.
For more information on structuring property ownership in Malta or to discuss your requirements in more detail, contact +356 2099 1531 or email info@sentientinternational.com.
