Segunda residencia en Malta: aspectos legales y fiscales para propietarios internacionales – Second Home

Imagine: Youre sitting on your terrace in Sliema, gazing out at the turquoise Mediterranean Sea and thinking, This could be my life. The dream of a second residence in Malta is tempting – 300 days of sunshine a year, EU membership, English as an official language. But between the first I want to buy a flat here and the relaxed after-work Cisk with sea views, there are plenty of legal and tax hurdles.

Ive lived in Malta for two years and took the journey from sun seeker to second home owner. Along the way, I tumbled through nearly every bureaucratic nightmare this island has to offer. The good news: it can be done. The bad: Without the right info, it gets expensive and nerve-wracking.

In this article, I’ll explain everything you need to know about a second residence in Malta – from legal basics to tax traps down to hidden costs that even experienced real estate agents like to forget to mention. Spoiler: it’s more complicated than an EU move to Berlin, but easier than a Green Card application.

Second Residence Malta: What Does It Mean Legally?

Before we get into the details, let’s clarify what Second Residence Malta actually means. Legally, it’s a rather flexible term that has different consequences depending on your nationality, length of stay, and intentions.

EU Citizens vs. Third Country Nationals: The Crucial Difference

As an EU citizen, you have a huge advantage: you can enter Malta without a visa, settle freely, and even work. It sounds relaxed at first, but there are still rules you need to follow.

EU Citizens (Germany, Austria, Italy, etc.):

• Stay up to 90 days: Registration not necessary
• Stay over 90 days: Registration with the Maltese police required
• Permanent residence: EU Long-term Residence Status possible after 5 years
• Property purchase: Basically permitted, but with restrictions

Third Country Nationals (Switzerland, UK post-Brexit, USA, etc.):

• Stay up to 90 days in 180 days: Tourist status
• Longer stays: Visa or residence permit required
• Malta Nomad Residence Permit: For remote workers (1 year, extendable)
• Global Residence Programme: For wealthy foreigners

I still remember my first visits to the authorities. As a German citizen, I thought: EU freedom of movement, this will work. Not so fast. Even within the EU, you must register properly if you want to stay longer.

Residence vs. Second Home – The Legal Grey Area

This is where it gets interesting: Malta distinguishes between Residence (primary residence) and Domicile (center of life). This distinction has massive tax consequences, which Ill explain later.

You acquire Maltese residence if:

• You spend more than 183 days per year in Malta
• You move your center of life to Malta
• You open a Maltese bank account and establish local ties

A second residence without residence status means:

• You keep your primary residence in your country of origin
• You spend less than 183 days in Malta
• You remain tax resident in your home country

The kicker: Malta is incredibly strict about the 183-day rule. Not only overnight stays are counted, but also arrival and departure days. My tip: keep careful records of your stays. An Excel sheet with entry and exit dates will save you stress with the Maltese tax office later.

Right of Residence for Second Home Owners

Just because you own property in Malta doesn’t mean you automatically have the right of residence. That’s a common misconception I often see in German Facebook groups.

The reality:

• Owning property ≠ right of residence
• You must abide by normal visa and residence rules
• For longer stays, you still need to register
• Renting your property requires additional permits

What does this mean for you? Plan your stays strategically and always stay within the permitted timeframes. Otherwise, the dream of a second residence can quickly turn into a bureaucratic nightmare.

Malta Second Residence Taxes: The Rules You Need to Know

Now we come to the heart of it – taxes. This is where things separate, because Malta’s tax system is unlike anything you know from Germany or Austria. The good news: with proper planning, you can legally save on taxes. The bad: One mistake can get very expensive.

Tax Liability for Second Residence in Malta: When Does It Get Serious?

Malta has what’s called a Remittance Basis System for non-domiciled persons. It sounds complicated but is actually ingenious: you only pay Maltese taxes on income you actually transfer to Malta.

You are taxable in Malta if:

• You spend more than 183 days per year in Malta
• You officially move your residence to Malta
• You earn Maltese income (e.g. rental income)

You are NOT taxable in Malta if:

• You spend less than 183 days in Malta
• You keep your main residence in your country of origin
• You do not transfer income to Malta

Here’s a concrete example from my advisory practice: Anna from Munich owns a flat in Valletta, which she uses herself for three months a year and rents out the rest of the time. The rental income goes into her German account. Result: she is liable for tax in Germany, not Malta.

Making Use of the Double Tax Treaty Germany-Malta

The Double Taxation Agreement (DTA) between Germany and Malta is your best friend in tax planning. It prevents you from paying tax on the same income in both countries.

Important: the DTA only applies if you are correctly registered. Overstaying leads to problems with both tax authorities.

The 183-Day Rule and Its Pitfalls

The famous 183-day rule is not as easy as it sounds. Malta counts differently from Germany, which can lead to unpleasant surprises.

How Malta counts:

• Arrival day counts as a full day
• Departure day counts as a full day
• Layovers over 24h count as days of stay
• Technical layovers do not count

Example: You fly to Malta on March 1 and back on August 31. That’s not 5 months, it’s 184 days – which makes you taxable in Malta. Ouch.

My mistake the first year: I counted my days wrong and was suddenly 12 days over the limit. The Maltese tax office was not amused and wanted a full tax return. Since then I keep a meticulous Excel list.

Pro tip for planning your stays:

• Plan intentional breaks (at least 7 days in a row)
• Use Christmas for trips back to Germany
• Document all flights and ferry trips
• Get your passport stamped on entry and exit (even within the EU)

What does this mean for you? Be strategic when planning your stays. 183 days sound like a lot but are reached faster than you think – especially if you prefer the Maltese winter to the German one.

Buying Property in Malta for Foreigners: Legal Requirements

This brings us to the most exciting part: buying property. Here, Malta makes a clear distinction between EU citizens and third country nationals, and even as an EU citizen you can’t buy whatever and wherever you like.

AIP (Acquisition of Immovable Property) Permit: When Do You Need It?

The AIP permit is Malta’s version of a foreign property acquisition permit – but more complicated. Whether you need it depends on your nationality and the type of property.

AIP permit required for:

• All non-EU citizens (without exception)
• EU citizens for properties in restricted areas
• EU citizens buying more than one property
• Commercial property over certain sizes

AIP permit NOT required for:

• EU citizens for their first purchase in unrestricted areas
• Maltese citizens
• Persons with EU Long-term Residence Status

Processing takes 6-12 weeks and costs between €1,500 and €3,000 – depending on property value. My tip: Apply for the permit before house hunting, not after. Sellers take you more seriously if you already have the authorization.

Restricted vs. Unrestricted Areas: The Malta Property Map

Malta divides its territory into restricted and unrestricted areas. This division goes back to the 1970s and often makes little sense today, but laws in Malta are set in stone.

I originally wanted to buy a townhouse in Valletta – romantic, historic, authentic. Then I found out that as an EU citizen I needed an AIP permit, the renovation rules were insane, and I couldn’t even change the window color without permission. In the end, I bought a modern apartment in Sliema – less charm, less bureaucracy.

Price Controls and Minimum Prices: Malta’s Artificial Real Estate Market

Malta introduced minimum prices for foreigners to prevent speculation. In practice, this means: as a foreigner, you automatically pay more than locals.

Current minimum prices for foreigners (as of 2024):

• Main island: €275,000 for apartments, €400,000 for houses
• Gozo: €220,000 for apartments, €300,000 for houses
• These prices are adjusted annually (usually upwards)

Practically, this means: even if you find a fixer-upper in Valletta for €200,000, you must pay at least €275,000. The difference goes to the state – a kind of hidden foreigner tax.

But there are loopholes: If you have a Maltese partner or have lived legally in Malta for 5 years, you can purchase at local prices. Some of my German friends got married first, then bought. Not very romantic, but financially smart.

What does this mean for you? Factor the minimum prices into your budget and don’t get upset about the unfairness. The system is unfair, but it is what it is. Focus on finding a good property anyway.

Registering a Second Residence in Malta: Step-by-Step Guide

Now it gets practical: How do you register your second home correctly? I’ll take you through the whole process – from the first office to the last stamp. Spoiler: it takes longer than you think, and doesn’t go as it says on the website.

Documents and Official Appointments: The Maltese Bureaucracy Marathon

Maltese authorities love paper. Lots of paper. And they like it when you come multiple times because something is always missing the first time.

Basic requirements for EU citizens:

1. EU passport or ID card (original + 2 copies)
2. Proof of accommodation: rental agreement, purchase contract, or hotel confirmation
3. Proof of financial means: bank statements from the last 3 months
4. Health insurance proof: EHIC or private insurance
5. Proof of employment: employment contract, business license or pension notice
6. Passport photo: 2, EU standard (35x45mm)

Additionally for non-EU citizens:

• Visa or residence permit
• Apostilled birth certificate
• Police clearance certificate (not older than 6 months)
• Proof of international health insurance

My tip: Have all documents notarized before coming to Malta. Maltese authorities often don’t recognize German certifications, and then you have to lug everything to the German embassy.

The Office Gauntlet: From Immigration Department to Customs

Station 1: Expatriate Unit (Immigration police)

Address: Police Headquarters, Floriana
Opening hours: Mon-Fri 8:00-12:00 (yes, only four hours!)
Queue: allow 2-3 hours

This is where you get your Residence Certificate – a yellow paper proving you’re living legally in Malta. Without this, nothing works in Malta.

Station 2: Inland Revenue (Tax Office)

Address: St. Calcedonius Square, Floriana
Opening hours: Mon-Fri 8:00-16:30
Queue: Now with online appointment booking

This is where you get your Maltese tax number. You need this for everything: bank account, rental agreement, purchase contract, mobile contract.

Station 3: Identity Malta (formerly LESA)

Address: Various locations
Opening hours: Varies by location
Queue: Online appointments possible and recommended

This is where you get your ID card – Malta’s answer to the German national ID. With the card, you can finally open a bank account and sign contracts.

I remember my first visit to the Expatriate Unit. I got there at 7:30am to be the first at the door. Nope. There were already 40 people ahead of me. Lesson learned: arrive early, but expect to wait anyway.

Bank Account and Utilities Setup: The Chicken-and-Egg Problem

Here comes the classic Malta paradox: You need an address for a bank account. For a rental agreement, you need a bank account. For utilities, you need a bank account. But for a bank account, you need proof of regular payments. Welcome to Malta!

The solution in 4 steps:

1. Get a temporary address: hotel, Airbnb, or friends
2. Open a basic bank account: with temporary address and EU ID
3. Find a permanent place to stay: with proof of bank account
4. Update address with the bank: with new lease

Bank recommendations for foreigners:

• Bank of Valletta: Traditional, quite straightforward for EU citizens
• HSBC Malta: International, English-speaking, but higher minimum deposits
• APS Bank: Local, inexpensive, sometimes tricky for foreigners

Pro tip: Open your bank account in person, not online. Maltese banks are old-school and like face-to-face meetings. Dress smart-casual and bring patience. A meeting with the bank manager can easily last 2 hours.

What does this mean for you? Plan at least 2-3 weeks for the whole registration process. And yes, you’ll have to go to each office multiple times. That’s normal, don’t worry. Malta runs on island time.

Costs of a Second Residence Malta: Realistic Budget Planning

Now we come to a point everyone underestimates: the costs. Malta seems small and affordable, but that’s deceptive. I’ll break down what a second residence really costs – from the obvious expenses to hidden costs that can blow your budget.

Purchase Incidentals and Ongoing Costs in Detail

For a €400,000 property, you’ll quickly add €50,000-80,000 in incidental costs. Many forget these when budgeting.

Ongoing annual costs:

• Maintenance fees: €1,200–3,600 (depending on building and amenities)
• Property tax: €200–800 (depending on value)
• Utilities (electricity/water): €800–1,500 (for part-time use)
• Internet/TV: €300–600
• Maintenance/repairs: €1,000–3,000 (highly variable)

So, expect about €4,000–8,000 annual costs for a standard second home. For luxury properties with a pool, concierge, or sea view, costs go up considerably.

Hidden Costs No One Mentions

The nastiest costs often come after buying. Here’s my list of surprises that happened to me and my friends:

Bureaucracy Costs:

• Apostilles and certifications: €300–800 per year
• Translations: €50–150 per document
• Lawyer for minor matters: €150–300 per session
• Official fees: €20–100 per stamp

Property quirks:

• No elevator: Renovating on the 4th floor costs 50% more
• Old electrics: Complete refit €8,000–15,000
• Damp: Ongoing mold prevention €500–1,000/year
• Air conditioning: Installation €2,000–5,000, electricity €100–200/month

The Malta Tax Traps:

• Eco-contribution: €5,000 for non-EU citizens (one-time)
• Property tax: Progressive up to 0.8% of property value
• Capital gains tax: Up to 35% for sales before 2030
• Rental income tax: 15% on rental income

My most painful hidden cost: the air conditioning. The flat had two old split units that used more power than a detached house. Replacement: €4,500. On the plus side, the bill went down from €180 to €80 a month.

Tax Advice – When Is It Worth It and When Not?

Good tax advice can save you thousands – or be completely unnecessary. Here’s my decision aid:

Tax advisor ABSOLUTELY necessary if:

• Income over €75,000 per year
• Complex international income
• Planned stays over 183 days
• Rental intentions
• Self-employment or entrepreneurship

Tax advisor probably NOT needed if:

• Pure holiday home (under 90 days/year)
• Simple employment relationships
• Clear tax residency
• Property for own use only

Costs for tax advice in Malta:

• Initial consultation: €200–500
• Annual tax return: €800–2,500
• Complex tax planning: €2,000–10,000
• Ongoing support: €300–800 per month

My tip: Invest in professional tax advice at least once, even if you think you don’t need it. Just knowing about the pitfalls and opportunities is worth the money. After that, you can decide if you need ongoing support.

What does this mean for you? Calculate realistically and allow a buffer of 20–30% for unexpected costs. Malta is more expensive than it looks, but still doable with the right planning.

Common Pitfalls with a Malta Second Residence

After two years in Malta and countless conversations with other expats, I’ve developed a feel for the classic mistakes. These pitfalls really get everyone, and some are very expensive. Here are the biggest stumbling blocks – and how you can avoid them.

Timing Mistakes with Registration: When Does It Get Critical?

Timing your registration in Malta is more critical than elsewhere. Registering too early or too late can have both legal and tax consequences.

Classic mistake #1: Registering too late

Many think, I’ll buy the property, then register. Wrong. Registration should run in parallel with the purchasing process, not after.

The consequences:

• Fines of €500–2,000 for late registration
• Problems opening a bank account
• Delays in contracts
• Tax queries for unregistered periods

Classic mistake #2: Choosing the wrong category

Malta has different residence categories, and the wrong choice can be expensive:

I have a German acquaintance who unknowingly registered as Resident although she only stayed in Malta for 4 months a year. Result: Full Maltese tax return and a hefty back payment.

Underestimated Bureaucracy: The Malta Reality Check

Malta may be an EU country, but bureaucracy still works in an Italian-British way. That means: lots of paper, little digitalization, and everything takes longer than promised.

Realistic time planning for key steps:

• Residence Certificate: 2–4 weeks (not the few days promised)
• ID card: 6–10 weeks (even though it says 4–6 weeks online)
• Bank account: 2–6 weeks (depends on nationality)
• AIP permit: 8–16 weeks (officially 6–8 weeks)
• Tax number: 1–3 weeks (usually the fastest)

The biggest bureaucracy traps:

• Documents expire: lots of proofs are only valid for 3–6 months
• Offices close early: Expatriate Unit only until noon
• Holidays not communicated: Malta has 14 public holidays
• Online systems often offline: always have a Plan B

My worst bureaucracy day: I got to the Expatriate Unit at 7:00, waited three hours, only to learn my bank statement was one day too old. The next day was St Pauls Shipwreck (a holiday I didnt know), and the office was closed.

Legal Risks in Renting: What German Owners Overlook

Many buy a property in Malta intending to rent it out when not there. Good idea, but legally more complicated than you think.

Types of letting and the rules:

• Long-term rental (12+ months): Easy, but strong tenant protection
• Short-term rental (1–11 months): Complicated, special permits required
• Airbnb/holiday rental: Only legal with STR license
• Furnished rental: Additional rules and taxes

The STR (Short Term Rental) license:

Without this license, holiday letting is illegal – with fines up to €50,000. The license costs €500–1,500 and comes with strict requirements:

• Minimum distance to schools and churches
• Maximum guest numbers (often only 4–6 people)
• Noise restrictions (especially in Valletta)
• Fire safety and escape routes
• Registration of all guests with the police

Tax traps when letting:

• Rental income tax: 15% on all income
• VAT obligation: from €35,000 turnover per year
• Social security: for business-level letting
• Capital gains: sale becomes more expensive due to letting history

A German friend rented his Sliema flat via Airbnb for two years without an STR license. Revenue: about €15,000. Fine: €25,000 plus back taxes. His lesson: compliance is expensive, but non-compliance is even more so.

My advice for prospective landlords:

1. Check BEFORE buying if letting is permitted in your building
2. Include all license and tax costs in your calculations
3. Plan 2–3 months for licensing
4. Use a local property manager (costs 15–25% but saves you nerves)

What does this mean for you? Malta doesn’t forgive ignorance, especially not with taxes and letting. Research thoroughly before making decisions, and don’t shy away from professional advice costs. One expensive mistake costs more than ten hours of advice.

Frequently Asked Questions

Can I just buy property in Malta as an EU citizen?

Yes, but with restrictions. As an EU citizen, you can freely buy in unrestricted areas, but need an AIP permit for restricted areas (e.g. Valletta, Gozo). Minimum prices also apply: €275,000 for apartments, €400,000 for houses on the main island.

When am I taxable in Malta?

You are subject to tax in Malta if you spend more than 183 days per year there or move your center of life to Malta. Both arrival and departure days count as full days. If you plan properly, as a non-domiciled resident you only pay tax on income transferred to Malta.

Do I need a residence permit for Malta as a German citizen?

No, as an EU citizen you don’t need a residence permit. For stays longer than 90 days, you must register at the Expatriate Unit and will receive a Residence Certificate. This registration is mandatory and free of charge.

Can I rent out my Malta property via Airbnb?

Only with an STR (Short-Term Rental) license, which costs €500–1,500 and comes with strict conditions. Without a license, fines of up to €50,000 apply. You must also pay 15% rental income tax and register for VAT if your annual turnover exceeds €35,000.

How long does the registration process in Malta take in total?

Allow at least 6–10 weeks for all formalities. The Residence Certificate takes 2–4 weeks, the ID card 6–10 weeks, and a bank account 2–6 weeks. Malta runs on island time, and you’ll often be missing a document on your first appointment.

What does a second residence in Malta really cost?

On top of the purchase price come 6–12% incidental costs (stamp duty, notary, lawyer). Ongoing costs: €4,000–8,000 per year for maintenance, insurance, utilities, and upkeep. Also allow for a buffer for hidden costs like renovations or administrative fees.

Can I use my German health insurance in Malta?

With the European Health Insurance Card (EHIC) you can get emergency medical care. For longer stays or as a resident, you need either private international health insurance or must enroll in the Maltese health system.

Which banks are best for Germans in Malta?

Bank of Valletta is traditionally the most German-friendly, HSBC Malta is international and English-speaking (but more expensive), APS Bank is cheap but sometimes tricky for foreigners. To open an account you need a Residence Certificate, tax number, and proof of regular income.

Is a tax advisor worthwhile for Malta?

If your income is over €75,000, you plan to stay more than 183 days, or you want to rent – definitely yes. An initial consultation costs €200–500 and can save thousands in tax. For pure holiday homes under 90 days, usually unnecessary.

What happens in a Brexit-like scenario?

Malta has been an EU member since 2004 and in the Eurozone since 2008. An exit is extremely unlikely as the economy relies heavily on EU benefits. Even hypothetically, existing property rights would be protected by bilateral agreements, as was the case with other EU exits.