The Malta Retirement Programme (MRP) and the United Nations Pensions Programme (UNPP) in Malta are two distinct initiatives aimed at attracting foreign retirees to retire in Malta by providing beneficial tax and residency status in Malta. Here's a comparison of the two programmes:
Overview: Malta Retirement Programme (MRP)
The MRP is an initiative aimed at attracting individuals interested in retiring in Malta who are not in an employment relationship and are in receipt of a pension as their regular source of income. Through this program, participants may benefit from a flat tax rate of 15% on foreign-source income remitted to Malta, with the possibility of claiming double taxation relief. Additionally, participants under the MRP are entitled to a residence permit, allowing them to reside in Malta.
The MRP provides a pathway for eligible individuals, including both nationals of the EU and non-EU citizens to retire in Malta and thus enjoy certain tax benefits and residency status in Malta. It is important to note that participants must meet specific requirements, including the payment of a yearly minimum tax, holding a qualifying property in Malta and maintaining health insurance coverage.
Overview: United Nations Pensions Programme (UNPP)
The UNPP, on the other hand, is a specialised programme for retiring in Malta established to provide benefits to eligible former United Nations Joint Staff members and their dependents. This program offers a special tax status to EU/EEA, Swiss, and third-country nationals, excluding Maltese citizens, who are in receipt of a United Nations pension or widows/widowers benefit, of which at least 40% is received in Malta.
Such a person is eligible to engage in activities related to any public institution, trust, or foundation, as well as any other similar organisation or group of people, likewise, of a public character, that works in Malta on projects related to education, charity, or research and development. A non-executive director of a firm headquartered in Malta may also be qualified under the UNPP to retire to Malta.
Taxation and Residency Status Overview
Under the UNPP, foreign-sourced income not remitted to Malta is not subject to tax, and beneficiaries of the program are exempt from taxation on their UN pension, including widows' benefits remitted to Malta (10,000 EUR is the minimum applicable tax). A special tax rate of 15% applies on income remitted to Malta by the beneficiary or the dependents.
On the other hand, the MRP for individuals who tend to retire to Malta provides tax benefits and residency status for individuals in receipt of a pension as their regular source of income. Any income received in Malta that does not originate in Malta will be subject to a 15% tax by the Maltese government (else to a minimum tax of 7,500 EUR, whichever is higher). All income, however, issued in Malta is liable to regular rate taxation. For a detailed overview of the MRP tax requirements please refer to the Malta Retirement Programme (MRP).
Eligibility and Requirements Overview
The UNPP is available to prospective applicants for retiring in Malta who are not permanent residents or long-term residents of Malta and are in receipt of a United Nations pension or widows/widowers benefit, of which at least 40% is received in Malta. For a detailed overview of the UNPP requirements please refer to our UNPP Comprehensive Guide.
The MRP is designed for prospective applicants for retiring to Malta who are not in an employment relationship and are in receipt of a pension as their regular source of income, are not employed in Malta, hold qualified property in Malta, aren't beneficiaries under other residency programmes in Malta, are in receipt of sufficient and stable income, covered by an EU Health Insurance Policy, aren't and don't plan to domicile in Malta for the next 5 years, and are a good and fit person.
To Sum Up
In summary, both the Malta Retirement Programme and the United Nations Pensions Programme provide opportunities for eligible individuals to retire in Malta and benefit from favourable tax rates and residency status in Malta. While the MRP is open to individuals in receipt of a pension as their regular source of income, the UNPP specifically targets individuals in receipt of a United Nations pension or widows/widowers benefit, outlining specific tax rates, exemptions, and residency requirements.
As Authorised Mandatories (ARM00905) we can provide you with the essential expert guidance prior to initiating an application for any of the aforementioned retirement programmes. Our team of experts is prepared to assist you with the MRP and/or the UNPP application process in Malta. Contact us to arrange a complimentary consultation so that the application process can be initiated.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
