Reduced Taxes on Property in Malta
After lifting most COVID-19 restrictions, in a press conference held on 8th June 2020, The Maltese Government announced a multi-million economic recovery package aimed at stimulating business and regenerating the Maltese economy post COVID-19.
This programme also includes property-related incentives which are listed below:
Reduction of Tax/duty cuts: Income tax on the sale of property will be reduced from 8% to 5% and stamp duty will be reduced from 5% to 1.5% for the first €400k on contracts signed by the end of March 2021. One would have to wait for more details on how these reduced rates will complement current stamp duty exemptions and reduced rates. The stamp duty exemption is also applied to pending promise of sale agreements for residential properties and covers the first €400,000 of the property value.
First-time buyers between the age of 21 and 39 years are eligible to apply for a €17,500 home loan from the government: This will assist them to raise the 10% deposit as a down payment. This interest-free loan will have to be paid back over a period of 15 years. First Time buyers will not be charged the stamp duty on the first €175,000 of the value of the property, however, the first-time buyers’ scheme will be altered so that those who had bought a garage would still be eligible.
Down payments on purchase of second home retained at 15% For individuals interested in purchasing a secondary property, the minimum amount for down payments will be retained at 15% of the purchase price up to July 2021.