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Work in Malta in a highly qualified post and benefit from a tax rate of 15% on your income.
 
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Highly Qualified Persons

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The rapid growth of the services industry has facilitated the entry of the Highly Qualified Persons (“HQP”) Programme which, in essence, is a residency programme intended to address Malta’s ever growing human capital requirements. Subject to a number of conditions, the HQP Programme offers a flat income tax rate of fifteen per cent (15%) to foreign, highly qualified individuals who seek employment in Malta.



Scheme Conditions

 

The HQP Programme are subject to a number of qualifications, namely that:

• the applicant is an individual that is subject to tax under a qualifying contract of employment, and receives employment income in respect of such contract;

• the applicant is protected as an employee under Maltese law;

• the applicant proves to the satisfaction of the competent authority that he is in possession of professional qualifications and has at least five years professional experience;

• the applicant proves to the satisfaction of the competent authority that he performs activities of an eligible office, as defined below;

• has not benefited from deductions available to investment services expatriates with respect to relocation costs and other deductions (under article 6 of the Income Tax Act);

• fully discloses for tax purposes and declares emoluments received in respect of income from a qualifying contract of employment and all income received from a person related to his employer paying out income from a qualifying contract as chargeable to tax in Malta;

• the applicant is in receipt of stable and regular resources which are sufficient to maintain himself and the members of his family without recourse to the social assistance system in Malta;

• the applicant resides in accommodation regarded as normal for a comparable family in Malta and which meets the general health and safety standards in force in Malta;

• the applicant is in possession of health insurance in respect of all risks normally covered for Maltese nationals for himself and the members of his family;

• the applicant is not domiciled in Malta;

• the applicant must not benefit under any alternative incentives available in Malta;

Qualifying Income

 

The flat rate of 15% shall apply to income from a qualifying contract of employment in an ‘eligible office’, provided that the income amounts to at least €75,000 annually (which is adjusted annually in line with the retail price index as seen below). On the other hand, income from a qualifying contract of employment exceeding the sum of €5,000,000 is not subject to tax. With respect to EEA and Swiss nationals, the 15% rate applies for a consecutive period of 5 years. Such EEA or Swiss nationals, who avail themselves of this tax benefit, shall be eligible for a one-time extension of an additional 5 year period. The one-time extension is not applicable to individuals who have been residing in Malta prior to the 1st of January 2008.

Non-European Union (EU) citizens, on the other hand, can benefit under the HQP Programme for a maximum consecutive period of 4 years (commencing on the year in which the taxpayer is first liable to tax in Malta).

Rights acquired under these Programme shall be deemed to have been withdrawn with retrospective effect if a beneficiary is a third country national and he or she either:
• resides in Malta, in the aggregate, for more than 4 years; or
• directly or indirectly acquires real rights over immovable property in Malta or directly or indirectly holds a beneficial interest consisting of inter alia real rights over immovable property situated in Malta.

Eligible Employments and Offices

 

The employment activity is considered to be an ‘eligible office’ under the HQP Programme if it is with companies licensed and/or recognized by the competent authority or with undertakings holding an air operators’ certificate issued by the competent authority. The HQP Programme also list the following positions which are deemed to be an “eligible office”:

• Chief Executive Officer
• Chief Risk Officer [including fraud and investigations officer]
• Chief Financial Officer
• Chief Operations Officer [including Aviation Accountable Manager]
• Chief Technology Officer
• Chief Commercial Officer
• Portfolio Manager
• Chief Investment officer
• Senior Trader
• Senior Analyst [Including structural Professional]
• Actuarial Professional
• Chief Underwriting Officer
• Chief Insurance technical Officer
• Odds Compiler Specialist
• Head of research and Development [including Search Engine Optimism and Systems Architecture]
• Aviation Continuing Airworthiness Manager
• Aviation Training Manager
• Aviation Ground Operations Manager
• Head of Marketing [Including Head of Distribution Channels]
• Head of Investor Relations

For further information on the HQP Programme, kindly contact the professional team at RC Malta.

If you are interested in finding out more about this programme, get in touch for a no obligation consultation. Contact us now.