The acquisition of property in Malta by Third Country Nationals is regulated by the Immovable Property (Acquisition by Non-residents) Act. This piece of legislation defines the conditions for purchasing a property.
CONDITIONS FOR PURCHASING IMMOVABLE PROPERTY IN MALTA
Individuals who are not citizens of a European Member state may not acquire any immovable property unless they are granted a permit in terms of the law. This does not apply to spouses of the Member States or Maltese citizens.
Citizens of all European Union member states, including Maltese Citizens, who have resided in Malta continuously for a minimum period of five years at any time preceding the date of acquisition may freely acquire immovable property without the necessity of obtaining a permit under Chapter 246 of the Laws of Malta.
On acquiring and disposing of immovable property in Malta, any person, whether juridical or physical, is subject to taxation according to the Duty on Documents and Transfers Act, Chapter 364 of the Laws of Malta and the Income Tax Management Act, Chapter 372 of the Laws of Malta and the Income Tax Act, Chapter 123 of the Laws of Malta.
Malta gained a reputation of opportunity to invest in immovable property from a stable market and an excellent return on investment. Favourable factors including regulatory development systems, lenient tax structures, ease of accessibility to European States nationals, and an appealing solution to investors from other nationalities who wish to invest in real estate.
Immovable property in Malta still benefits from no tax on ownership or wealth making such conditions an attraction to many foreigners taking up residence in Malta.
International investors may acquire real estate in Malta, within parameters of deluxe standards through Designated Special Areas (SDAs). Multiple properties may be obtained in Malta, with opportunities of reselling and renting such properties.
From the 1st January 2013, when the Notary examines the title to a property, the Notary is obliged to prepare a Report and give it to the buyer on the signing of the contract, for a fee agreed to between the buyer and the Notary.
Before 2013 the law did not establish what searches should be carried out by the Notary. This left the buyer in a situation of uncertainty and therefore the law was changed to protect the buyer.
Customer Due Diligence Protocols & Anti-Money Laundering Obligations
At the outset of a new transaction, the transacting parties including the Notary and Agent will require some detailed information from all the parties which is either obligatory or deemed necessary for the proper discharge of particular obligations. In terms of Legal Notice 180/2008, the Notary is a Subject Person and is legally bound to ensure that proper Customer Due Diligence (CDD) and Anti-Money Laundering (AML) procedures are followed through.