Taxation on the transfer of immovable property in Malta

Taxation on the transfer of immovable property in Malta exceptions

• 5% final withholding tax on the value of the property not forming part of a project, transferred before five years from the date of its acquisition;
• 2% final withholding tax on the transfer of property acquired for the purpose of establishing one’s sole ordinary residence, and which is transferred no later than 3 years from the date of acquisition;
• Non-resident persons producing a statement issued by the tax authorities of their country of residence, confirming they are resident in that country and subject to tax in that country on gains or profits derived from the transfer of immovable property situated in Malta.
• A transfer from one co-owner to another co-owner;
• A transfer of property to the Government of Malta following a requisition order;
• A transfer of property used for business for a period of at least 3 years and which is replaced within one year, to be used for a similar purpose;
• A transfer of property that forms part of a project made by a company that has issued listed bonds to the public.

• Donations by a person to his spouse, to his descendant or ascendant in the direct line, or to the spouse of any such descendant or ascendant, or, in the absence of any descendants in the direct line, to his brother or sister or to a descendant of his brother or sister, or to an approved philanthropic institution.
• A transfer of property that has been owned and occupied by the transferor as his own residence for a period of at least three consecutive years immediately preceding the date of transfer and which is disposed of within twelve months of vacating the premises, on condition that such property is declared to be the main residence of the transferor.
• The assignment of property between spouses consequent to a judicial or consensual separation or a divorce or upon dissolution of the community of acquests between the spouses.
• A transfer of property between companies forming part of the same group.
• The transfer of property upon the incorporation of a business or a partnership en nom collectif as a going concern into a limited liability company.
• The settlement of property on trust, or the distribution or reversion of property settled on trust, or the transfer of all the property of a trust involving only a change in the trustee of a trust and where there is no change in the beneficiaries or in the beneficial interest.
• A transfer of property by a company to its shareholder or to an individual related to its shareholder in the course of winding up or in the course of a distribution of assets pursuant to a scheme of distribution.