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The Tax Treatment of Highly Skilled Individuals Rules, 2026 (L.N. 20 of 2026), (hereinafter referred to as the "Rules") which came into force on 1st January 2026, introduce a consolidated tax framework aimed at attracting highly skilled professionals to Malta. The Rules replace and unify several legacy rules, including the Highly Qualified Persons Rules and the Qualifying Employment in Aviation (Personal Tax) Rules, into a single structure applicable across multiple regulated and strategic sectors.
At their core, the Rules provide for a flat 15% rate of income tax on qualifying employment income, subject to eligibility, income thresholds, and compliance requirements.
Scope and eligibility
The preferential tax treatment applies exclusively to employment income chargeable to tax in Malta derived from an eligible office recognised by a designated competent authority, such as the MFSA, MGA, Transport Malta, Malta Enterprise or the Office of the Chief Medical Officer.
Applicants must be employees (not self-employed or contractors) and must satisfy a number of substantive conditions, including appropriate professional qualifications or experience, suitable accommodation in Malta, valid travel documentation, and comprehensive private medical insurance. The regime is therefore substance-driven and not merely a formal designation.
Income thresholds and tax treatment
Eligibility is subject to a minimum annual emoluments threshold of €65,000, exclusive of fringe benefits. This threshold is indexed to increase by €10,000 every five years. Where approved, qualifying employment income is taxed at a 15% flat rate, capped at €7 million per annum. Any income exceeding this cap is subject to tax at the standard rate.
Duration and validity period
The special tax status is granted for an initial period of five years, with the possibility of renewal for further five-year periods, subject to continued compliance. However, the Rules expressly provide that no benefits may be enjoyed beyond 31st December 2040, regardless of renewal eligibility.
Transitional provisions apply to individuals who were already benefiting from predecessor regimes as at 31st December 2025, subject to specific conditions.
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.
