NOMAD RESIDENCE PERMITS (INCOME TAX) RULES

SUBSIDIARY LEGISLATION 123.210

NOMAD RESIDENCE PERMITS

(INCOME TAX) RULES

7th December, 2023

LEGAL NOTICE 277 of 2023.

The title of these rules is the Nomad Residence Permits

(Income Tax) Rules.

For the purposes of these rules, unless the context

otherwise requires

"the Act" means the Income Tax Act;

"authorised work" means services provided by an eligible

main applicant in accordance with a contract of employment with

an employer who is not resident in Malta and who does not carry

on business in Malta through a fixed place of business, or

services performed by an eligible main applicant in a self-

employed capacity for clients who do not reside in Malta and

who do not carry on business in Malta through a fixed place of

business, which services, in either case, are provided remotely by

means of telecommunications technology as may be approved by

Residency Malta Agency;

"eligible main applicant" means an individual who is in

possession of a valid nomad residence permit;

"nomad residence permit" means a residence permit

issued in terms of the Immigration Act, that grants a third

country national a licence to perform work in Malta consisting

exclusively of authorised work;

"Residency Malta Agency" means the

agency

established in accordance with article 3 of the Residency Malta

Agency (Establishment) Order.

(1)

An eligible main applicant shall be chargeable to

income tax at the rate of ten percent (10%) on his chargeable income

derived from authorised work, subject to any relief of double taxation

as provided in Part X of the Act.

(2)

The income referred to in sub-rule (1) for any year of

assessment shall be deemed to constitute the first part of the person’s

total chargeable income for that year of assessment.

(3)

Notwithstanding the foregoing provisions, an eligible

main applicant shall not be liable to tax on income derived from

authorised work before the end of twelve (12) months from

(a)

the date on which the nomad residence permit is

issued, or

(b)

the 1st January 2024, whichever is the later;

unless he files with Residency Malta Agency a written

declaration that his residence in Malta, even during the said

period of twelve (12) months, is not merely of a casual nature.

(4)

Income of the eligible main applicant, other than income

derived from authorised work, that is chargeable to tax in Malta in

accordance with the Act, shall be governed by the applicable provisions

of the Act.

(5)

Any income which is chargeable to tax in Malta derived

by any family member of the eligible main applicant who is authorized

as such by Residency Malta Agency by being included in the nomad

residence permit shall not be regulated by these rules, but shall

continue to be governed exclusively by the provisions of the Act.

(6)

Income earned by the eligible main applicant from

authorised work in accordance with a contract of employment shall not

be subject to the provisions of the Final Settlement System (FSS)

Rules.

(7)

If an eligible main applicant, for any reason, does not

remain in possession of a nomad residence permit, but

(a)

is subsequently granted a new nomad residence

permit within a period of two (2) years from when the said

person ceases to hold the original nomad residence permit, he

shall be entitled to benefit from the provisions of this rule,

except for those of sub-rule (3); or

(b)

is subsequently granted a new nomad residence

permit after a period exceeding two (2) years from when the said

person ceases to hold the original nomad residence permit, he

shall be entitled to benefit from the provisions of this rule,

including those of sub-rule (3).

(1)

Subject to the other provisions of this rule, an

eligible main applicant having income chargeable to tax in Malta shall

be required to be registered for income tax purposes and to file a return

of income accordingly.

(2)

An eligible main applicant shall

(a)

be required to be registered for income tax

purposes even in respect of the activities carried out before the

end of the period of twelve (12) months referred to in rule 3(3);

(b)

not be required to report for income tax purposes

the income earned by him from authorised work up to the end

of the said twelve (12) month period unless he has filed with

Residency Malta Agency the written declaration referred to in

rule 3(3); and

(c)

unless otherwise directed by the Commissioner,

he shall not be required to file a return of income if he does not

derive any chargeable income other than

(i)

income from authorised work; and

(ii)

other income that does not require to be

reported in a return of income,

and the period comprised in the particular basis

year does not extend beyond the end of the said twelve

(12) months.

(3)

In respect of any year or part thereof in which an

eligible main applicant is subject to tax in respect of income

arising from authorised work, if he provides official written

documentation proving to the satisfaction of Residency Malta

Agency acting on behalf of the Commissioner, that he has paid

tax in a country outside Malta at a rate of at least ten percent

(10%) on the said income, he shall not be required to report

such income for Maltese income tax purposes on the basis of

the fact that the tax due on such income shall be deemed to have

been settled by the application of the relief of double taxation

provisions of the Act.

(4)

Residency Malta Agency shall forward to the

Commissioner the official documentary proof as provided by

the eligible main applicant in accordance with sub-rule (3), as

may be applicable.

For the purposes of ascertaining an eligible main

applicant’s entitlement to rights applicable in accordance with these

rules and ensuring the proper application of these rules and of the

Income Tax Acts, Residency Malta Agency shall provide to the

Commissioner such further information and documentation as the

Commissioner may consider necessary.

(1)

Without prejudice to the provisions of article 51

of the Act and of any other anti-tax avoidance provisions under the

Income Tax Acts, where any eligible main applicant is in a position to

obtain an undue advantage which has the effect of reducing his

liability to tax in a manner which is not reconcilable with the objective

and purpose of these rules, the Commissioner shall determine the

relevant liability to tax in such manner and in such amount as may be

necessary so as to nullify any such benefit or advantage.

(2)

The provisions of sub-rule (1) shall apply without

prejudice to any other provisions in any other law as well as any

administrative action thereunder, penalizing situations involving tax

abuse practices.

(1)

The presence in Malta of an eligible main

applicant performing authorised work in accordance with a contract of

employment shall not of itself result in his employer being deemed to

derive income arising in Malta.

(2)

The presence in Malta of an eligible main applicant

performing authorised work in a self-employed capacity shall not of

itself result in his clients being deemed to derive income arising in

Malta.