Retiring in Malta
When retirement approaches, many people opt to spend their post-work days in a better climate with different opportunities for daily activities. Malta is a very popular retirement destination for its climate, cost of living, lifestyle, and the ability for expats to fit in with the local culture.
If you wish to settle in a stable and peaceful European Union country, Malta can be the ideal destination for you. An English-speaking nation in the Mediterranean, Malta brings together many positive attributes for your retirement years.
Be sure to enquire about related conditions and procedures for moving to Malta beforehand.
There are several ways to retire in Malta: the Malta Retirement Programme, the Global Residence Programme, the Residence Permits for EU and non-EU Nationals and the acquisition of Maltese citizenship by investment. The healthcare system and the cost of living in Malta are advantageous for people aiming to retire there. In addition, the laidback Mediterranean lifestyle is very enjoyable.
The Malta Retirement Programme (MRP)
The Malta Retirement Programme (MRP) has been set up by Maltese authorities so as to attract EU, non-EU, EEA and Swiss Nationals, allowing them to live in Malta thanks to their income from foreign sources. According to this program, they are not allowed to work in the archipelago, but they can still enjoy its desirable lifestyle.
Applying for the MRP is simple and will grant the successful applicant a 15% flat tax rate only on Maltese-derived income or on overseas income that is remitted to Malta. MRP participants are not taxed on worldwide income. Income derived in Malta will be taxed at a rate of 35%, and that income cannot exceed 25% of your total annual income.
Malta Retirement Programme eligibility criteria
To qualify, an applicant must be an EU, non-EU, EEA, or Swiss National and must live in Malta for a minimum of 90 days per year, averaged over a 5-year period. Additionally, the applicant cannot live in any other country for more than 183 days in a year.
Applicants must own or rent property in Malta at a minimum cost as follows:
- Owning property in Malta (except the south of Malta): €275,000
- Owning property in Gozo (or the south of Malta):
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After 1 January 2011 up to 30 June 2013: €250,000
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On or after 1 July 2013: €220,000
- Renting property in Malta (except the south of Malta): €9,600 annually
- Renting property in Gozo (or the south of Malta): €8,750 annually
Additionally, an applicant must receive a pension with documented evidence. The pension must constitute at least 75% of the person's chargeable income for any tax year.
Pensions include periodic payments paid to a former employee in respect of past employment. Regular incomes from an occupational retirement scheme, personal overseas retirement plans and insurance policies are also included. However, pensions do not include lump sum payments of any type.
The pension must be enough for the retired person to maintain themselves without recourse to the social assistance system in Malta.
The applicant must submit an up-to-date police conduct certificate as evidence of being a “fit and proper person”.
The applicant must hold health insurance applicable in Malta.
He must also be able to communicate in English or Maltese.
And finally, the applicant cannot benefit from any other programs.
The minimum tax payable per year is €7,500, plus €500 for each dependent.
How to apply to the Malta Retirement Programme
The application can only be submitted to the Commissioner for Revenue through the services of an Authorised Registered Mandatory (ARM). The ARM list can be found here. The applicant needs to authorize such services by completing and signing in the original Part 1 of the application form.
To apply to the Malta Retirement Programme, the application with the required supporting documentation needs to be sent to the International & Corporate Tax Unit at the following address:
International & Corporate Tax Unit AM Business Centre, Labour Road Zejtun, ZTN 2401
The mention “Application: Malta Retirement Programme” should be written on the envelope.
A non-refundable administrative fee of €2,500 applies.
Important:
The Malta Retirement Programme residence permit does not allow you to work or set up business in Malta.
However, it allows you to partake in activities related to any institution, trust or foundation of a public character that is engaged in philanthropic, educational or research and development work in Malta.
Retiring in Malta with the Global Residence Programme (GRP)
The GRP is a good option for retired persons who are looking to receive a specialized tax status while residing in Malta.
However, not everyone is eligible for this program. The GRP is open to non-EU/EEA/Swiss Nationals who do not have the Long Term Residence (see below in this article).
Moreover, the applicant must fulfil stringent monetary requirements. He or she must invest in property valued at at least €275,000 (€220,000 in certain areas), or establish a rental contract for at least €9,600 (€8,750 in certain areas).
The Global Residence Programme allows you to travel within the EU and settle indefinitely in Malta.
Residence Permit in Malta for retired EU, EEA and Swiss Nationals
If you do not qualify for the Malta Retirement Programme or the Global Residence program, you could still qualify for residence in Malta during your retirement.
The Residence Permit is an option for retired EU, EEA and Swiss Nationals coming to Malta. The EU nationals benefit from the right to free movement. They need to apply for the Residence Permit (eResidence card) to stay more than 3 months in Malta.
There are several types of Residence Permits in Malta. The Economic Self-Sufficiency is one of them. Pensioners and retired persons fall under this category. They must be able to support themselves and their family members accompanying or wishing to join them in Malta. They need to have sufficient resources not to become a burden on the State.
In order to apply for the Residence Permit, the applicant must have a place of residence in Malta. They also must be covered by health insurance.
A minimum level of resources is required:
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A bank balance of €14,000 for individuals — or €23,300 for married couples;
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Or a demonstrated regular income of €92.72 per week — €105.93 for married couples and an additional €8.15 for each dependent child.
The application form can be found on the Identity Malta website.
The tax you will pay under Residence is worked out by taking 15% of your income. Starting in 2018, the Maltese government instituted a minimum liability of €5,000 per year.
Temporary Residence Permit in Malta for retired non-EU Nationals
Retired non-EU Nationals can benefit from a Residence Permit in Malta too. It is called Temporary Residence Permit.
Malta being part of the Schengen Zone, this is very advantageous for non-EU Nationals. By getting a residence permit in Malta, they will be able to travel throughout the Schengen Zone without the requirement of a visa for stays up to three months.
The self-sufficient Residence Permit is also open to non-EU/EEA/Swiss Nationals planning to retire in Malta. Mind that the application form is different from the application form designed for EU/EEA/Swiss Nationals. It can be found on the Identity Malta website as well.
The conditions to get this Residence Permit are almost the same as the conditions for EU/EEA/Swiss Nationals.
The applicant must have an address in Malta and be covered by health insurance.
However, the capital threshold rises to €50,000. Approval is at the discretion of government officials who have shown an inclination to prefer that wealthy individuals apply under the investment visa, which requires a significant investment.
You will need to renew your residence permit every year. You must proceed within 90 days from the date of expiry. Your current permit needs to be still valid.
Holders of this residence permit are eligible for the remittance-based tax system at 15%. A minimum liability of €5,000 per year also applies.
Permanent Residence for EU and EEA Nationals retired in Malta
Thanks to the right to free movement, EU/EEA Nationals and their family members can apply for permanent residence in another EU country. They can do so after living there legally for a continuous period of 5 years.
Long-Term Residence for non-EU Nationals retired in Malta
After 5 years, third-country nationals can get Long-Term Residence in Malta. They must have been legally and continuously residing in Malta.
The applicant must show that they are economically self-sufficient. Their income must equal at least Malta's minimum wage plus an added 20% for each dependent family member.
Acquisition of Citizenship for Exceptional Services by Direct Investment (MEIN)
The MEIN is a good option for retired people who are ready to invest a large sum in Malta. They will be granted Maltese citizenship.
The applicant must make a direct investment of €600,000 or €750,000. He or she also needs to purchase a property in Malta having a minimum value of €700,000 or rent property in Malta for a minimum annual rent of €16,000. Finally, he or she must donate a minimum of €10,000 to an NGO.
Healthcare in Malta during retirement
Regarding healthcare in Malta, do not worry. The Maltese archipelago is recognized by the WHO (World Health Organization) for the quality of medical care. It ranks amongst the top countries (like France) regarding the health system.
In hospitals and dispensaries, care is free, but in private clinics, you need to pay. However, foreigners are advised to go to the clinics, as getting an appointment in a hospital is often difficult. Good health insurance will cover you. However, subscribe before you leave because if you are over 55, which is certainly the case if you retire (or you are very lucky!), Maltese health insurance companies will be reluctant.
Cost of living when retiring in Malta
The cost of living in Malta is generally lower (around 20%) than in major European cities, but in popular places like Saint Julian's, Sliema or Valletta, it can be the same. It is, however, possible to find in these cities a modern apartment with a small garden at a lower price while moving away from the city center.
As for shopping, the prices are quite similar to those of Europe. Don't forget that Malta is an island and that many products are imported.
Regarding health, you will have to pay about €15 for a consultation with a general practitioner and approximately €40 with a dentist.
If you want to rent an apartment or house, you will pay on average 700 to 1000 euros in the city and 600 outside. It varies according to the type of accommodation, the number of rooms, the size of the garden, etc., not to mention that coveted cities like St Julian's or Sliema are more expensive. To buy a property in Malta, you will have to pay €350,000 for a small house of character with a room in a charming village or €300,000 for an apartment with 2 or more bedrooms in the city. With a larger budget, you will have a little paradise!
Good to know:
Once settled in Malta for your retirement, you will benefit from rare advantages in this beautiful world: no tax on great wealth, no home taxes, and no property taxes! Foreign capital gains are not taxed in Malta and the archipelago has signed double taxation treaties with many countries, which can be beneficial.
Living as a retired in Malta
Everyday life in Malta is pleasant and slow-paced for retired people.
Don't you speak Maltese? Don't worry. English is the second national language, and if you don't speak it, it will be a great opportunity to learn! The Maltese will be happy to help you, they are very sympathetic people. Although it is taught at school, French is not used in Malta, but many people speak Italian.
A lot of retired people choose Malta for its pleasant climate. Malta has a temperate climate ranging from 15°C in winter to 30°C in summer. If you like to swim, you will be delighted, because the water temperature is almost always 20°C and goes up to 27°C or even more in warm weather!
Maltese cuisine has many Mediterranean influences (Arabic, Italian and Tunisian). Its insular and fresh local produce (seasonal fruits and vegetables and fish) are widely used. You will have no trouble getting your supplies from local retailers or supermarkets, such as Welbee's Supermarket in Sliema.
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