The government has announced incentives for buyers, vendors and renovators this week in the latest budget announced on Monday 11th October in the evening. No taxes or stamp duty will be payable on UCA properties, properties older than 20 years having been vacant for more than 7 years and newly built properties when built displaying a typical Maltese architectural character. The scheme is limited to the first €750,000 of the value of the property. This also applies to properties that are currently under Promise of Sale agreements.
Additionally, those that buy for the first time will receive a grant of €15,000 and this goes up to €30,000 for buyers of Gozo property. This measure was taken in order to promote younger people to make Gozo their home and this scheme will be valid for three years.
The reduction of the rate of stamp duty to 1.5% on the first €400,000 of the transfer value, and the reduction of income tax on capital gains to 5% on the first €400,000 of the transfer value will not be renewed and therefore will expire in June 2022 as previously announced.
When renovating, there’s a VAT refund!
The same property categories will also be eligible for a VAT refund of up to €54,000 on the first €300,000 spent on any renovations of these properties. The properties referred to are not allowed to be split up into smaller units in order to be earmarked for the refund amounts.
The already-existing schemes for first and second-time buyers are being extended for another year. First time buyers will not pay tax on the first €200,000 and up to €3,000 can be claimed back by 2nd time buyers.
These are only some of the key fiscal property incentives that were announced earlier this week and we are confident that such measures will continue to sustain the momentum that the local property market enjoys. These will stimulate further interest from the market, both locally and overseas and promote investment in Maltese real estate even more.