Property transfer tax and stamp duty on the sale of immovable property in Malta

Property transfer tax and stamp duty on the sale of immovable property in Malta

A sale of immovable property situated in Malta attracts two separate charges: property transfer tax on the seller under the Income Tax Act, normally collected by the notary as a final withholding tax on the transfer value, and duty on documents and transfers on the buyer, administered by the Property Tax Directorate of the Malta Tax and Customs Administration. The Malta Tax and Customs Administration states that "The seller must pay capital transfer taxes on the transfer of any property located in Malta, whilst stamp duty is paid by the buyer." The charge arises on the deed of transfer, with a provisional stage at promise of sale. Figures are for tax year 2026. The official pages carrying these figures state their own effective dates rather than a tax year (for example, the 8% rate is stated as applying "With effect from 1st January, 2015"); where a page states its own period, that period is given in the tables below.

Who this is for

This Guide is for a transferor selling immovable property situated in Malta by deed inter vivos, and for the transferee who pays the duty on that deed. It covers the final withholding tax rates the Malta Tax and Customs Administration publishes for such transfers, and the provisional and final duty steps the same authority publishes for the buyer.

It does not cover transfers causa mortis or declarations of causa mortis, share transfers, or donations, all of which the Malta Tax and Customs Administration deals with under separate pages and separate rules. It also does not cover the assignment of a right obtained under a promise of sale: the authority states that such an assignment "is not regulated by the property transfers tax regime".

Rates, thresholds and deadlines

Property transfer tax on the seller

Property transfer tax on the seller — FAQ figures (https://mtca.gov.mt/personal-tax/property-taxes/faqs/new-property-tax-system---faq)

What	Value	Note
Source	all figures below	https://mtca.gov.mt/personal-tax/property-taxes/faqs/new-property-tax-system---faq
Standard final withholding tax on transfer value	8%	The page states that with effect from 1st January 2015 the earlier system "will be replaced by one final withholding tax of 8% on the value of the property transferred".
Property acquired before 1 January 2004	10% final withholding tax	The page contrasts transfers "subject to either 8% final withholding tax or else 10% final withholding tax in the case where the property was acquired before the 1st January, 2004".
Restored grade 1 or grade 2 scheduled property, or property in an urban conservation area, where a notice of promise of sale or transfer was given before 17 November 2014	10% of the transfer value	Stated as "chargeable at the rate of 10% of the transfer value" for transfers made on or after 1 January 2015 under the relevant restoration scheme.
Transfers in the circumstances of article 31C(1) of the Income Tax Act	7% of the transfer value	The page states the transfer "shall be chargeable at the rate of 7% of the transfer value. The 7% tax is final."
Transfers where a notice of promise of sale or transfer was given to the CfR before 17 November 2014, in the cancelled or expired promise of sale cases described	12% final tax	The page states that "such transfers will remain taxable at the rate of 12% final tax".
Provisional tax where a non-resident opts out of the final withholding system and is taxed under article 5 (capital gains)	7% provisional tax	The page states that for transfers on or after 1 January 2015 this 7% provisional tax "shall not be available for refund under article 48 of the Income Tax Management Act".
Brokerage fees	Deductible from the transfer value	The page states brokerage fees "will remain deductible" and that the amount paid by the transferor continues to be allowable as a deduction from the transfer value.

Property transfer tax on the seller — Examples figures (https://mtca.gov.mt/personal-tax/property-taxes/faqs/new-property-tax-system---examples)

What	Value	Note
Source	all figures below	https://mtca.gov.mt/personal-tax/property-taxes/faqs/new-property-tax-system---examples
Transfer made not later than five years after the date of acquisition	5% final withholding tax on the transfer value	The worked example states "The 5% rate applies because the transfer is made not later than five years after the date of the acquisition of the property."
Reduced 5% rate where the transferor is a company	Applies if the transfer of property does not form part of a project	The page notes the reduced 5% rate applies "if the transfer of property does not form part of a project".
Election to exclude the transfer from the final withholding tax system	7% provisional tax paid at the time of publication of the deed	The examples state the election is made "by means of a declaration made to the notary at the time of the publication of the deed", with the gain or profit then declared in the tax return.

Duty on documents and transfers on the buyer

Duty on documents and transfers on the buyer — Buying Property figures (https://mtca.gov.mt/personal-tax/property-taxes/buying-property)

What	Value	Note
Source	all figures below	https://mtca.gov.mt/personal-tax/property-taxes/buying-property
Provisional duty at promise of sale stage	1%, paid by the purchaser	Charged "based on the market price or transfer value as per contract, whichever is the higher".
Time limit to present the promise of sale to the Property Tax Directorate	Within 21 days	The promise of sale is to be presented to the Property Tax Directorate of the Office of the Commissioner for Tax and Customs within that period.
Additional duty (penalty) where an architect's valuation raises the value	20% of the duty due	The claim to the buyer includes the duty due together with the additional duty based on the difference in the value of the property transfer.
Interest where the claim is not paid	0.75% for every 30 days or part thereof	Interest "shall start accruing after the expiration of three months from the date of notification of the original assessment".
Time limit to object to an assessment	Within thirty days from the date of service of assessment	An objection in writing is valid only if it specifies the valid grounds it is based upon.

Duty on documents and transfers on the buyer — General Information on Duty figures (https://mtca.gov.mt/personal-tax/property-taxes/general-information-on-duty)

What	Value	Note
Source	all figures below	https://mtca.gov.mt/personal-tax/property-taxes/general-information-on-duty
Worked example given on the page	Declared price €200,000; duty payable on contract €10,000; provisional duty payable €2,000	The page gives this as its own illustration of the 1% provisional duty paid by the purchaser at promise of sale stage.
Tolerance between the declared value and the market value established by the department's architect	15%	The page states "the law allows a 15% tolerance between the declared value and the market value established by the department's architect".
Issue of receipts after submission of the notice of transfer (DDT1)	Normally not later than 3 weeks from the date of submission	Stated for receipts issued by the Property Tax Directorate.
Time limit to present the promise of sale to the Property Tax Directorate	Within 21 days of the actual signing	Stated on the same page.

Duty on documents and transfers on the buyer — Promise of Sale figures (https://mtca.gov.mt/personal-tax/property-taxes/promise-of-sale)

What	Value	Note
Source	all figures below	https://mtca.gov.mt/personal-tax/property-taxes/promise-of-sale
Provisional duty payable when the notary registers the promise of sale	20% of the duty payable on the final deed	Registered by the notary within 21 days from the signing of the promise of sale agreement, together with that payment.

Duty on documents and transfers on the buyer — Guidelines (second-time buyers) figures (https://mtca.gov.mt/docs/default-source/documents/guidelines-stb.pdf?sfvrsn=cae8b349_1)

What	Value	Note
Source	all figures below	https://mtca.gov.mt/docs/default-source/documents/guidelines-stb.pdf?sfvrsn=cae8b349_1
Second-time buyers scheme (SL 364.17) refund	Duty paid on the first €86,000 of the value of the replacement property is refunded	Applies where an individual transfers a residential property and acquires a replacement residential property within 12 months of the transfer of the replaced property.
Period stated by the guidelines	Acquisitions made from the 10th October 2017 up to the 31st December 2024	The guidelines state the notice required under Article 51 of the Duty on Documents and Transfers Act must have been submitted to the Commissioner on or before the 28th February 2025; this is the period the page itself states, not tax year 2026.

The method, step by step

• Step 1 — Engage the notary — Engage the notary. For a transfer of property to take place in Malta a notary must be engaged to process property searches and file the necessary deeds; the notary is usually chosen by the buyer and is also engaged to process provisional duty payments on behalf of the buyer. The seller may use an estate agent to find a prospective buyer, and the parties then delegate a notary. (Buying Property; Selling Property)
• Step 2 — Register the promise of sale and pay provisional duty — Register the promise of sale and pay provisional duty. Once the promise of sale is signed it is presented to the Property Tax Directorate within the period in the table above, and the purchaser pays the provisional duty at that stage. The notice is given on form DDT3, "Notice of Promise of Sale / Transfer of Immovable Property". (Buying Property, Promise of Sale; Downloads)
• Step 3 — Obtain the provisional duty receipt — Obtain the provisional duty receipt. A receipt for provisional stamp duty is issued to the taxpayer once payment is received by the Property Tax Directorate, confirming that the notary has submitted a copy of the promise of sale and that provisional duty has been paid by the buyer. (Buying Property)
• Step 4 — Decide, before the deed, whether the seller elects out of the final withholding system — Decide, before the deed, whether the seller elects out of the final withholding system. Where the election is available it is made by declaration to the notary at the time of the publication of the deed, provisional tax is paid at the rate in the table above, and the gain or profit is declared in the tax return. (New Property Tax System - Examples)
• Step 5 — Publish the deed and submit the DDT1 — Publish the deed and submit the DDT1. Upon signing of the contract the notary publishing the deed submits the DDT1 form at the Property Tax Directorate together with site-plans, a copy of the Public Registry note, the stamp duty payment due by the buyer, the capital gains tax payment due by the seller, and Schedule 8 for residential property only. Schedule 8 is listed as "DDT - Eight Schedule – Physical Attributes of Immovable Property". (General Information on Duty; Downloads)
• Step 6 — Await the receipts and any valuation — Await the receipts and any valuation. Receipts are normally issued within the period in the table above; at this stage an internal departmental board decides whether an architect is sent to inspect the property to establish its market value, subject to the tolerance in the table above. (General Information on Duty)
• Step 7 — Deal with any claim or assessment — Deal with any claim or assessment. Where the architect adds value, the buyer's claim includes the duty due plus the additional duty (penalty), and the vendor is charged the additional duty (penalty) only; unpaid claims attract interest at the rate and from the point set out in the table above. (Buying Property, General Information on Duty)
• Step 8 — Object in writing if the assessment is disputed — Object in writing if the assessment is disputed, within the period in the table above, specifying the valid grounds; if no agreement upon objection is reached, the Commissioner issues a Refusal. (General Information on Duty)

Ask the client first

• When exactly was the property acquired? Acquisition before 1 January 2004, and transfer within five years of acquisition, each carry a different rate in the tables above.
• Was a notice of a promise of sale or transfer given to the Commissioner before 17 November 2014 in respect of this property, and was it later cancelled or did it expire? This determines whether the 12% row applies instead of the standard rate.
• Has the property been restored under a scheme for grade 1 or grade 2 scheduled property or property in an urban conservation area?
• Is the transferor non-resident in Malta and resident for tax purposes in another country, and does the transferor want to opt out and be taxed under article 5 (capital gains)?
• Does the property form part of a project, or is it situated in a special designated area? The reduced rate for companies is stated to apply only where the transfer does not form part of a project.
• What brokerage fees did the transferor pay, and are they evidenced? They are deductible from the transfer value.

When to refuse or refer

• Any transfer causa mortis, declaration causa mortis or inheritance matter; the Malta Tax and Customs Administration treats these under separate pages and this Guide does not cover them.
• Share transfers, inter vivos or causa mortis, which the Property Tax Directorate handles separately.
• The assignment of a right obtained in terms of a promise of sale (konvenju), which the authority states is not regulated by the property transfers tax regime.
• Claims under the first-time buyers' exemption. The guidelines identify it as the exemption under Article 3 of the Exemption of Duty in terms of Article 23 Order (SL 364.12) and require the property to be acquired for sole and ordinary residence, but the page read here does not state the exempt amount, so no figure is given for it.
• The general statutory rate of duty on an acquisition of immovable property, and any reduced rate for particular localities or property types. The pages read here state only the provisional duty and the worked example in the tables above; the underlying rate is not stated on them, so it is not stated here.
• Cases where duty is claimed to be exempt or refunded under the second-time buyers scheme outside the period the guidelines themselves state.
• Determination of market value where the departmental architect's valuation exceeds the declared value beyond the stated tolerance; this requires the assessment and objection procedure, and a valuation the official page describes as remaining subjective.

Sources

• https://mtca.gov.mt/personal-tax/property-taxes/faqs/new-property-tax-system---faq
• https://mtca.gov.mt/personal-tax/property-taxes/faqs/new-property-tax-system---examples
• https://mtca.gov.mt/personal-tax/property-taxes/buying-property
• https://mtca.gov.mt/personal-tax/property-taxes/selling-property
• https://mtca.gov.mt/personal-tax/property-taxes/general-information-on-duty
• https://mtca.gov.mt/personal-tax/property-taxes/promise-of-sale
• https://mtca.gov.mt/personal-tax/property-taxes/downloads
• https://mtca.gov.mt/docs/default-source/documents/guidelines-stb.pdf?sfvrsn=cae8b349_1
• https://mtca.gov.mt/docs/default-source/documents/guidelines-ftb.pdf?sfvrsn=60c3eece_1

Drafted by OpenAccountants. Not yet reviewed or approved by a named accountant.