Q & A. - ACQUISITION OF IMMOVABLE PROPERTY IN MALTA

  • What is the procedure to purchase immovable property in Malta?

Acquisition by Individuals:

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.

Citizens of all European Union member states, including Maltese Citizens, who have not resided continuously in Malta for a minimum period of five (5) years may only purchase their primary residence or any immovable property required for their business activities or supply of services without the necessity of obtaining a permit under Chapter 246 of the Laws of Malta.

Citizens of all European Union member states, including Maltese Citizens, who have not resided continuously in Malta for a minimum period of five years, require a permit under Chapter 246 of the Laws of Malta to acquire immovable property for secondary residence purposes.

Individuals who are not citizens of a European Member state may not acquire any immovable property unless they are granted an acquisition permit (AIP) in terms of Chapter 246 of the Laws of Malta.

There are defined zones in Mata, referred to as special designated areas, where there are absolutely no restrictions to acquisition - the s-called Special Designated Areas. There is also no restriction on acquisition through inheritance and there are also several other special exemptions. Different rules apply to the acquisition by Companies and other legal persons (bodies of persons).


 

Acquisition by Companies and other Legal Persons:

A body of persons, other than a commercial partnership, established in and operating from an European Union member state may freely acquire immovable property that is required for the purpose for which it has been set up as long as it is directly controlled by citizens of a European Union member state who have resided in Malta continuously for five years.
A commercial partnership established in and operating from an European Union member state (therefore including Malta) may freely acquire immovable property that is required for the purpose for which it has been set up and at least 75% of its share capital is held by a person (or persons) who is a European Union Member state citizen.

Any other body of persons will require a permit (AIP) which is only granted if the property is required for an industrial or touristic project or as a contributor to the development of the economy of Malta.

When the prospective buyer identifies the immovable property to be purchased, he/she enters into a written agreement (promise of sale agreement), a copy of which must be attached to the AIP application form obtainable from the Capital Transfer Duty Department of the Inland Revenue Division or downloaded from the Ministry's website.


 

  • How long does it take for an application to be processed?

 

In accordance with a Quality Service Charter, the AIP Section is committed to issue the requested permit within 35 days subject to application submitted being correct. It is important to note that the AIP Permit does not include the Permanent Residence Permit, which may be applied for separately.

 

 

  • What do I need to submit with an application to acquire immovable property in Malta?

 

You need to attach the following documents with the relative application form duly filled in:

  1. Two passport sized photos;

  2. Copy of promise of sale agreement;

  3. Photocopy of passport showing details.

 

  • What are the fees for an AIP Permit?

 

Currently, the fee payable on the issue of a permit is €232.94.

 

 

  • Are there any conditions imposed on the permit?

 

In issuing an AIP permit the Minister of Finance shall impose the following conditions:
 

 

        In the case of a dwelling house:

  1. That the immovable property is solely used as a residence by the applicant and his family and for no other purpose;

  2. That the acquisition is to be effected within six months from the date of issue of the permit, saving the granting of any extension as may be applied for;

  3. That within three months from publication of the deed of acquisition, a certified copy of such deed must reach the office of the Commissioner of Inland Revenue (Capital Transfer Duty Department); and

  4. That the immovable property may not be sold in part, or otherwise converted into more than one dwelling house

               In the case of a garage or other adjoining property:

  1. That the immovable property is used solely as a garage by the applicant and his family or as an extension to be integrated with the applicant's existing dwelling;

  2. That the acquisition is to be effected within six months from the date of issue of the permit, saving the granting of any extension as may be applied for;

  3. That within three months from publication of the deed of acquisition, a certified copy of such deed must reach the office of the Commissioner of Inland Revenue (Capital Transfer Duty Department); and

  4. That the immovable property covered by this permit may not be sold or otherwise disposed of separately but only together with the applicant's original dwelling house.

        In the case of a plot of land:

  1. That the acquisition is to be effected within six months from the date of issue of the permit, saving the granting of any extension as may be applied for; and

  2. That within three months from publication of the deed of acquisition, a certified copy of such deed must reach the office of the Commissioner of Inland Revenue (Capital Transfer Duty Department).

  3. That the immovable property is eventually to be used solely as a residence by the applicant and his family and for no other purpose;

  4. That the applicant is to develop the plot into one complete single residence ready for occupation within a period of two years from the date of issue of this permit;

 

  • Can I rent my immovable property to third parties?

 

The purchased immovable property cannot be rented to third parties.

 

 

  • Can I acquire more than one immovable property in Malta?

 

As a non-resident, you are allowed to purchase only one immovable property in Malta unless it is situated in a Special Designated Area e.g. Portomaso Development Complex, Tigne' Development, Cottonera Waterfront and Fort Chambray.


 

  • Who are the persons who need to apply?

  1. In relation to physical persons: any person not having a permanent residence in Malta, for 5 years prior to the date of the contract and;

   2. In relation to legal persons: any company, firm, etc that is registered in or             under the laws of a state other than Malta or another EU Member; or has             its registered address or principal place of business in a state other than             Malta or another EU Member State; or 25% or more of its capital is owned           by a non-resident or it is in any manner and whether directly or indirectly           controlled by one or more non-resident persons;


 

  • I am married to a Maltese; do I need a permit to acquire immovable property in Malta?

 

The spouse of a citizen of Malta or another E.U. Member State, where such spouses acquire together immovable property in Malta, falls within the definition of a "resident of Malta".

Disclaimer: This information has been referenced from the Notarial Website (https://www.notariesofmalta.org/).While the Notarial Council endeavours to present the most current information, please consult a notary, legal or tax professional for legal advice. 

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Chris Carabott
A Real Estate Professional internationally coached and recognised for the highest level of integrity and commitment. 
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Sliema, SLM 3011, Malta

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