Tax Treatment of Highly Skilled Individuals Rules, 2026

When clients approach a Malta tax advisor about this regime, the first question is always the same: “Do I actually qualify?” The law sets out six core conditions, all of which must be satisfied:

Non-Domicile
The first requirement relates to domicile status. The regime is designed specifically for foreign professionals relocating to Malta. To qualify, an individual must not be domiciled in Malta and must never have benefited from the older remittance-basis tax regime previously available under Article 6. This condition ensures that the scheme remains focused on attracting international talent rather than restructuring the tax affairs of individuals already closely connected to Malta.

Valid Employment

The second requirement concerns employment status. The individual must be engaged as a genuine employee under Maltese law, meaning that the relationship must reflect a real employer–employee structure. Self-employed individuals do not qualify. The role must involve actual direction and supervision from the employer, and the individual’s competence must be recognised by the relevant regulatory authority. In practice, this is one of the areas where proper tax consulting Malta can help ensure the employment structure meets the legal requirements.

Professional Qualifications

Professional qualifications also play an important role. Applicants must either hold a recognised post-secondary qualification that required at least three years of study, or demonstrate a minimum of five years of comparable professional experience in the relevant field. The purpose of this condition is to ensure that the regime remains focused on highly skilled professionals whose expertise contributes to Malta’s economic development.

Substance & Character

Beyond qualifications, regulators also assess the overall substance of the applicant’s presence in Malta. Individuals must demonstrate that they have stable and sufficient income to support themselves and their family without relying on social assistance. They must also have appropriate residential accommodation that meets local health and safety standards. Valid travel documentation and comprehensive private medical insurance for all family members are also required. Importantly, the applicant must genuinely perform the qualifying professional role for which the application is made.

The legislation repeatedly refers to the requirement that these elements must be satisfied “to the satisfaction of the competent authority.” This means that regulators have a degree of discretion when reviewing applications.

Minimum Income

Another important requirement is the minimum income threshold. To qualify for the regime, the individual must earn at least €65,000 per year from the eligible employment contract, excluding fringe benefits. This threshold will increase over time, rising to €75,000 from 2031 and €85,000 from 2036. The intention is to ensure that the regime continues to apply to senior or specialised professionals rather than general employment.

The rules also introduce strict anti-abuse provisions. Beneficiaries must fully disclose all employment income related to the qualifying role. In addition, any payments received from parties related to the employer must also be declared if they are substantially connected to the employment activity. The law explicitly prohibits artificial arrangements designed to make an employment contract appear eligible when it is not. If such arrangements are detected, the Commissioner may withdraw the benefit and reassess the individual under the standard tax rates.

Eligible Role

Finally, the employment role itself must appear on the official list of eligible positions. These roles cover a wide range of sectors that are strategically important to Malta’s economy.

The list of qualifying roles spans several industries, particularly those that require specialised expertise.

In financial services and other regulated sectors, the regime typically applies to senior executive and specialist positions such as Chief Executive Officer, Chief Financial Officer, Chief Risk Officer, Chief Compliance Officer, portfolio managers, senior traders and private equity professionals. These roles are generally overseen by the Malta Financial Services Authority.

The aviation and maritime sectors also feature prominently. Positions such as Flight Operations Manager, Safety Manager, Technical Manager, Master or Chief Engineer may qualify under the regime, subject to confirmation by the relevant transport authority.

Malta’s gaming industry is another sector included within the framework. Roles such as Senior Analyst, Head of Research and Development, Odds Compiler Specialist, Chief Legal Officer and other senior management functions may qualify when approved by the Malta Gaming Authority.

The legislation also recognises the importance of highly skilled professionals in science and technology. Specialists such as software developers, data scientists, cybersecurity experts, engineers, mathematicians and artificial intelligence professionals may qualify through Malta Enterprise.

Certain specialised medical roles are also included, particularly within the field of assisted reproductive technology.

For employers and international professionals alike, confirming that the role appears on the approved list is an important first step, and this is often reviewed during consultations with a Malta tax advisors team.

The Flat Rate

Qualifying employment income is taxed at a flat rate of 15 percent. However, the rate applies directly to the gross income earned from the eligible employment contract. Unlike the standard personal tax system, this regime does not allow most deductions, allowances or tax credits. Family allowances, spouse deductions and pension reliefs are therefore not applicable when calculating the tax under this regime.

 The Ceiling

The legislation also introduces a very high income ceiling. The preferential rate applies only to the first €7 million of annual employment income. Any amount above this threshold would be taxed under Malta’s normal progressive tax rates. In practice, very few individuals are likely to reach this limit.

 Other Income

It is also important to remember that the preferential 15% rate applies only to income earned from the qualifying employment contract, including any fringe benefits paid as part of the salary package. Other sources of income — such as rental income, investment returns, or dividends — remain taxable under the normal Maltese tax rules. This distinction is often relevant when individuals seek comprehensive Malta tax advice regarding their overall tax position.

Who Handles Applications

The application process for the regime involves several steps and must be handled through the appropriate regulatory authority rather than directly through the tax office.

Depending on the sector involved, applications may be submitted to the Malta Financial Services Authority, the Malta Gaming Authority, the transport authority responsible for aviation and maritime matters, the Chief Medical Officer’s office or Malta Enterprise.

Deadlines
Applications may be submitted between 1 January 2026 and 31 December 2035, while the final deadline for acceptance of applications is 31 December 2036. The relevant authority typically has around ninety days to review the submission, although this period may be extended if additional documentation is required.

 The Decision

Once the authority issues a positive determination, the decision is communicated to the Commissioner for Revenue. The individual must then formally elect to apply the regime when submitting their annual tax return. Meeting the normal tax return filing deadline is essential, as failing to file on time may invalidate the election.

The regime is granted for an initial period of five years starting from the year in which the eligibility determination is issued.

Beneficiaries may apply for two further extensions of five years each, potentially allowing the regime to apply for up to fifteen years in total. However, the legislation includes a fixed sunset clause: no benefits will apply to income earned after 31 December 2040, regardless of when the individual first entered the regime.

Professionals who were already benefiting from earlier expatriate tax schemes are not excluded from the new system.

Individuals who held beneficiary status under one of the previous regimes as of 31 December 2025 may apply to transition to the new framework. This application must be made by 31 December 2028. Once approved, the individual may receive a fresh five-year benefit period under the new rules, together with the possibility of further extensions.

The previous schemes themselves will gradually phase out, with their benefits ending after the year of assessment 2030.

Commissioner’s Powers

The Commissioner and competent authorities can request any information and documents needed to verify your eligibility and ensure you’re complying.

If you fail to provide requested information without valid reason, the Commissioner can withdraw the regime’s application to your income. Your income then reverts to normal tax rates.

 Breach Consequences

Non-compliance, artificial arrangements, or failure to declare related-party income can result in reassessment and loss of all benefits.

The Commissioner has the same objection and appeal rights as under standard assessment procedures.

For Employers: This regime is a powerful recruitment and retention tool for bringing specialized foreign talent to Malta – it offers a predictable 15% rate and legitimate legal status.

For Beneficiaries: If you qualify, the 15% rate is highly competitive compared to Malta’s normal 35% top rate. However:

• Eligibility is strict – the regulator really will assess your credentials, competence, and substance.
• No deductions reduce the 15% – it is a clean flat rate on gross salary.
• You must fully disclose all related-party income.
• Artificial arrangements will be exposed and result in full loss of benefit plus reassessment.
• The regime expires at the end of 2040 regardless of extension.

Procedural Discipline: Applications must go through the right competent authority; determinations must be formally issued; the option must be declared in your tax return by the filing deadline.

Transition: Existing beneficiaries from the old schemes should apply by end of 2028 to migrate to this new framework and avoid losing the benefit after 2030.

Substance Over Form: The legislation emphasizes substance – you must genuinely hold the role, genuinely have the qualifications, genuinely be non-domiciled, and genuinely intend to work in Malta. Paper structures will not work.

Regulatory requirements and Maltese tax legislation evolve regularly and often require careful interpretation.

If you need support in navigating Maltese legislation or assessing how specific provisions may apply to your circumstances, you can book a consultation with one of our legal or tax advisory Malta professionals.

Depending on your needs, this may take the form of an oral consultation to address specific questions or a more detailed written analysis referencing applicable legislation.

Our objective is always to help clients navigate Maltese regulatory and tax matters with clarity and confidence.