he Highly Qualified Persons Rules, 2011 was introduced through Maltese Parliament through Legal Notice 106 of 2011 and is a Malta Residence
programme that seeks to attract highly qualified persons in the financial, gaming and aviation sectors by offering a 15% flat rate of tax.
Who is eligible for the Highly Qualified Persons Rules?
The applicant of the Highly Qualified Persons Rules must be employed within the following parameters:
- The applicant of the Highly Qualified Persons Rules must be employed by a company licenced and recognised by the Malta Financial Services Authority or the Lotteries and Gaming Authority or companies which hold an Air Operators’ Certificate (Legal Notice 152 of 2013);
- The applicant must hold an eligible office.
The Malta and Financial Services Authority recognises and licenses companies including financial institutions, insurance companies and intermediaries, investment services licence holders, funds and pension schemes. The Lotteries Gaming Authority regulates and licences companies within the remote gaming, casino gaming and sports betting industry.
The applicant under HQPR must occupy one of the following positions:
- Actuarial Professional
- Aviation Continuing Airworthiness Manager
- Aviation Flight Operations Manager
- Aviation Ground Operations Manager
- Aviation Training Manager
- Chief Executive Officer
- Chief Financial Officer
- Chief Commercial Officer
- Chief Insurance Technical Officer
- Chief Investment Officer
- Chief Operations Officer (including Aviation Accountable Manager)
- Chief Risk Officer (including Fraud and Investigations Officer)
- Chief Technology Officer
- Chief Underwriting Officer
- Head of Investor Relations
- Head of Marketing (including Head of Distribution Channels)
- Head of Research and Development; (including Search Engine Optimisation and Systems Architecture)
- Portfolio Manager
- Senior Analyst (including Structuring Professional)
- Senior Trader/Trader
- Odds Compiler Specialist
What are the conditions of the Highly Qualified Persons Rules?
The applicant of the Highly Qualified Persons Rules in Malta must complete all of the below considerations in order to qualify for the programme. These are as follows:
- The applicant of the Highly Qualified Persons Rules must receive employment income no less than €82,881 per annum that is subject to tax in Malta;
- The applicant of the Highly Qualified Persons Rules must have his employment contract subject to the laws of Malta;
- The applicant of the Highly Qualified Persons Rules must have at least five years professional experience;
- The applicant of the Highly Qualified Persons Rules must have adequate professional qualifications related to the field of work;
- The applicant of the Highly Qualified Persons Rules must prove to the satisfaction of the Malta Financial Services Authority or Lotteries and Gaming Authority that he performs duties adequate to an eligible office;
- The applicant of the HQPR must not have benefitted from any deductions available to investment services expatriates including relocation costs and other deductions;
- The applicant of the HQPR must prove that:
o They have regular and stable resources which are enough to maintain themselves and their family without the need of social assistance in Malta;
o They reside in accommodation that would be deemed normal in comparison to a comparable family in Malta;
o They are not domiciled in Malta;
o They are in possession of a valid travel document;
o They must have adequate health insurance cover for themselves and their family.
What are the tax considerations of the Highly Qualified Persons Rules?
The applicant on successful application for the Highly Qualified Persons Rules would be entitled to a 15% flat rate on all employment income. The tax benefits for EU, EEA and Switzerland nationals are available for a consecutive period of 5 years starting from the first year the applicant of Highly Qualified Persons Rules is subject to tax. Applicants can also avail themselves to a one time extension of 5 years giving a total of 10 years that an individual can benefit from the Highly Qualified Persons Rules in Malta. This one time extension is not available for individuals whom have been resident in Malta prior to 1st January 2008.
Non EU nationals are entitled to benefit from the Highly Qualified Persons Rules in Malta for a maximum period of 4 years.
The maximum entitlement to the Highly Qualified Persons Rules can be reduced further if the applicant was employed under a contract of employment that required the performance of relevant duties in Malta up to 2 years prior to the 1st January 2010.
How do I apply for the Highly Qualified Persons Rules in Malta?
The Commissioner of Inland Revenue requires that any individual wishing to take advantage of the Highly Qualified Persons Rules in Malta should obtain a signed declaration from the Malta Financial Services Authority or Lotteries and Gaming Authority as applicable. The relevant authority will check the relevant conditions for the Highly Qualified Persons Rules as outlined above are met and subsequently will endorse the form. This declaration will then be used and attached to the individual’s personal income tax return and filed accordingly.
Trusted and Authorised Advisors of the Highly Qualified Persons Rules
Papilio Services Limited, as leading tax advisors in Malta are able to give advice on the Highly Qualified Persons Rules in Malta. We can assist on the Highly Qualified Persons declaration and also advise the individual with regards to compliance issues such as the timely completion and submission of the personal tax return.
Please contact us for more information on the Highly Qualified Persons Rules in Malta.