The objective of the Highly Qualified Persons Rules (Subsidiary Legislation 123.126) is to attract highly qualified persons to occupy an eligible office within licensed companies and/or recognized by the Malta Financial Services Authorities, companies licensed by the Lotteries and Gaming Authority and undertakings holding an Air Operator’s Certificate or an Aerodrome License issued by the Authority for Transport in Malta.
Eligible office shall comprise employment in any one of the positions set out below:
- 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
- The rules of the scheme apply to income which is brought to charge in year of assessment 2011 (basis year 2010)
- The scheme applies to individuals not domiciled in Malta with the exception of positions association with the aviation sector
- Individual income from a qualifying contract of an employment in an eligible office with a company licensed and/or recognised by the MFSA, is subject to a flat tax rate of 15%.
- The income must amount to a minimum €81,457 for basis year 2015 but cannot exceed €5,000,000. The excess is exempt from tax.
- The 15% tax rate applies for a consecutive period of five years for EU, EEA and Swiss nationals and for a consecutive period of four years for third country nationals.
Qualifying Contract of Employment
The following employment conditions must be satisfied:
- Derives employment income subject to income tax in Malta
- Has an employment contract subject to the laws of Malta and proves that the contract is drawn up for exercising genuine and effective work in Malta
- Proves that he is in possession of professional qualifications and has at least five years professional experience;
- Has not benefited from deductions available to investment services expatriates with respect to relocation costs and other;
- Fully discloses for tax purposes and declares emoluments received in respect of income from a qualifying contract of employment and all income received from a person related to his employer paying out income from a qualifying contract as chargeable to tax in Malta;
- Proves that he performs activities of an eligible office; and
- Proves that:
- he is in receipt of stable and regular resources which are sufficient to maintain himself and the members of his family without recourse to the social assistance system in Malta;
- he resides in accommodation regarded as normal for a comparable family in Malta and which meets the general health and safety standards in force in Malta;
- he is in possession of a valid travel document;
- he is in possession of sickness insurance in respect of all risks normally covered for Maltese nationals for himself and the members of his family.
- An individual will not qualify for the 15% reduced rate if it is paid by an employer who receives any benefits under business incentive laws or is paid by a person related to the employer who received any benefits under any business incentive laws or if the individual holds 25% or more of the company licensed and/or recognised by the MFSA.
- An individual will not qualify for the scheme if a claim is made for any relief, deduction, reduction, credit or set-off of any kind except for any income tax deducted at source.