Extension to the Exemption from Tax on Certain Property Transfers

By means of LN 121 of 2022, the Government of Malta has amended the above-mentioned rules, which were originally issued in 2020 after announcing a recovery package with the aim of restoring the economy following the effect of the COVID-19 pandemic In terms of the said rules, the applicable rate of tax on transfers of immovable […]

Written By Stephen Balzan

On May 8, 2022
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By means of LN 121 of 2022, the Government of Malta has amended the above-mentioned rules, which were originally issued in 2020 after announcing a recovery package with the aim of restoring the economy following the effect of the COVID-19 pandemic

In terms of the said rules, the applicable rate of tax on transfers of immovable property situated in Malta, on the first Eur400,000 of the transfer value, shall be of 5% (instead of 8% or 10%).  The tax on the transfer value which is in excess of Eur400,000 shall be of 10% or 8%, depending on the date of acquisition of the immovable property being sold.  In the case of a transfer of an undivided share of property, the benefit shall apply only to such portion of Eur400,000 which corresponds pro rata to the share that is transferred.  The reduced rate of 5% is applicable on the condition that the transfer would have been subject to tax at the rate of 8% or 10% on the transfer value, were it not for the provisions of these rules, and that the notice of the transfer is given to the Commissioner by not later than the 31 of October 2022.

All the conditions of any one of the following paragraphs must be satisfied in order to benefit from the said reduction

  • The transfer should be made on or after 9 June 2020 but before 1 January 2022.  The notice of transfer must be delivered to the Commissioner by not later than the 31 January 2022 ;OR;
  • The transfer should be made on or after 9 June 2020 but before 30 September 2022 (previously 1 July 2022).  The transfer must be made in terms of a promise of sale agreement or transfer notice made by not later than the 31 December 2021 (previously 31 July 2021).  The notice of transfer must be delivered to the Commissioner by not later than the 31 October 2022 (previously 31 July 2022)

How can we help?  

For further information, please contact one of the firm’s tax partners, Stephen Balzan on [email protected] or Elaine Camilleri [email protected]. ACT can help you understand the changes to the tax rules and how these can impact your business.  

Apart from its offices in St. Julian’s Malta, ACT operates from a second office in Gozo, which is situated in the capital city of Victoria.  For an appointment in our Gozo office, please call on +356 21378672 or send us an email on [email protected].