AE Legal
Can anyone (including foreigners) own and occupy real estate in your jurisdiction (including shares in property owning companies)? Are there any restrictions?
Certain limitations apply to non-Malta residents who wish to acquire property in Malta and a permit in writing, granted by the responsible minister, may be required. Non-Malta residents may acquire high-value properties in areas known as Special Designated Areas, having the possibility of acquiring several units without limitation. Non-Malta residents may also acquire real estate through inheritance.
EU citizens who are non-residents require a permit to acquire real estate for secondary residence purposes. EU citizens who reside continuously in Malta for five years any time prior to acquiring real estate are deemed to be residents of Malta and may acquire immoveable property without a permit.
Non-Malta residents may also hold shares in property-owning companies and the necessary permits may also be required, if more than 25% of the company’s share capital is owned by persons not resident in Malta.
Are there restrictions on lending for the purchase of real estate by foreign companies? If so briefly give an outline?
There are no statutory limitations to lending money to foreign entities. Malta has several licensed credit institutions which offer banking services. Providing lending facilities to foreign entities will depend on the applicant’s status and credit institution’s policies and anti-money laundering obligations.
Buying
Please provide a short summary of the fees and costs (including tax) relating to buying real estate in your jurisdiction.
Apart from the consideration for the immoveable property and fees owed to the notary, including for vetting of title, tax, specifically stamp duty, is owed by the buyer, generally at a rate of 5%.
Other costs include costs relating to registrations with the relevant authorities, permits, and fees owed to other service providers including real estate agents and architects where applicable.
Tax is also levied against the seller in the form of capital gains when selling property, however applicable tax rates may vary for non- Malta residents depending on their tax status.
Owning
Are there taxes applicable to owning real estate and can the burden of the taxes be passed to someone else (e.g. a tenant or an occupier - not being the owner
Malta does not impose taxes on the basis of ownership, and no annual taxes are owed simply for owning property.
Tax Breaks
Are there tax breaks or other incentives for foreigners to buy real estate in your jurisdiction? If so, what are they?
Foreign companies generally benefit from attractive income tax rates however there are no specific tax breaks solely to acquire property.
How is the ownership of Real Estate evidenced in your jurisdiction?
This will depend on how one acquires real estate. Where a person acquires real estate by purchasing the property, said purchase is evidenced by the public deed drawn up by a notary. Failure to acquire a property by virtue of a public deed renders the acquisition null. Following the contract, the notary must register the said deed with the public registry within fifteen working days from said sale, otherwise the sale is not considered to have legal effect against third parties. If the property is within a compulsory land registration area, the sale must also be registered with the land registry. Amongst others, deeds of partition and causa mortis declarations evidence the ownership of real estate, where real estate is not acquired by virtue of a sale.
Is it possible to keep the identity of owners of real estate confidential in your jurisdiction?
No, as all property transactions must be registered with the Public Registry, whether in Malta or Gozo, and, where applicable, the Land Registry, which registries are open to public inspection. These records include the names of property owners and any encumbrances. However, to search for the owner of an immoveable property one must have in possession the personal details of the owner or a previous owner.
Information pertaining to Maltese companies is also made public on the Malta Business Registry, which holds a registry including information about the company shareholders. Access to information about ultimate beneficial owners may however be limited.