Malta extended the stamp duty exemption for property buyers which was announced during Budget 2020. This makes it attractive for foreign property buyers in Malta through Malta Residence and Citizenship schemes
First Time Buyers
The stamp duty exemption for first-time buyers has been extended once again and the exemption shall now apply to the first €175,000 (currently €150,000) of the property value.
The reduction in stamp duty to 3.5% is now applicable on the first €175,000 (current €150,000) of the property value. This shall apply to non-first time buyers and individuals who live in a property which they will eventually inherit.
Second time buyers
The second time buyers scheme which is applicable to those individuals who have sold their first property in order to acquire another residential property has been extended for year 2020. The tax refund on stamp duty shall be of €3,000.
Gozo and other areas
The reduction in stamp duty introduced in previous years in respect of property acquired in Gozo (reduction from 5% to 2%) and property acquired in Urban Conservation Areas (reduction from 5% to 2.5%) is being extended for another year. The reduction in the stamp duty rate applicable to a qualifying transfer of business (property and shares) is being further extended. The stamp duty rate in such cases is reduced to 1.5%.
Taxes
As from 1st January 2020, the tax on the first €100,000 of profit derived from the assignment of any right obtained in terms of promise of sale ‘konvenju’ shall be taxable at a rate of 15% final tax as opposed to the current 35% corporate tax.
Financing
A new financing scheme will be introduced as from 2020 and it will be aimed at assisting those individuals who are under the age of 40 and who cannot afford to pay the 10% deposit on property acquisition. By an agreement with the banks, the government will provide such financing up to a maximum of €17,500 payable over a 15 year period and the interest on such amount shall be financed by the government.
