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Maltese Professionals Returning to Work in Malta

In terms of the Repatriation of Persons established in a Field of Excellence Rules, (Subsidiary Legislation 123.142), an eligible individual who is established in a field of excellence and returns as an ordinary resident to Malta may opt to have his income from employment exercised in Malta charged to tax at a flat rate of 15% without the facility to claim any deductions. Any other income will be taxed at the rate applicable to that income had the option not been exercised.

The duration in terms of the Rules commences from the year in which that person was first liable to tax after returning to reside in Malta. The scheme applies for a consecutive period of up to five years and is subject to the satisfaction of the following conditions:

Eligible person

The term ‘eligible person’ refers to an individual who is established in a field of excellence and returns to take up residence in Malta

The term ‘eligible person’ refers to an individual who is established in a field of excellence and returns to take up residence in Malta. This individual must prove that he had been ordinarily resident in Malta for at least 20 years, but has not been ordinarily resident in Malta for the 10 consecutive years prior to his return to Malta.

Field of excellence

This means an area of professional competence in which a person has excelled in the manufacturing and research and development sectors as may be defined in the Guidelines issued by Malta Enterprise Corporation in terms of the Malta Enterprise Act.

Qualifying contract of employment

A qualifying contract of employment refers to the employment of an eligible person in a field of excellence, in such sector/s as may be defined in the Guidelines, which consists of income subject to tax and received by an eligible person of a minimum value of €75,000 per annum exclusive of any fringe benefits. Approval in writing for the qualifying contract of employment must be obtained from the Malta Enterprise Corporation.

The beneficiary

A beneficiary in terms of the scheme is an individual who meets all the following conditions:

1. He derives emoluments payable under a qualifying contract of employment received in respect of work or duties carried out in Malta, or in respect of any period spent outside Malta in connection with such work or duties, or on leave during the carrying out of such work or duties;
2. He proves to the satisfaction of the Corporation that he is in possession of the requisite educational and/or professional qualifications relevant to the profession or sector of field of excellence as defined in the Guidelines;
3. He is protected as an employee under Maltese law for the purpose of exercising genuine and effective work for or under the direction of someone else and has the required adequate and specific competence as approved by the Corporation; and
4. He declares the emoluments received from the qualifying contract of employment and all income received from a person related to his employer for income tax purposes in Malta.

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