Inheritance and Succession in Malta for Foreign Residents

The first question is the governing law, not the address on the residence card

A family may assume that a Maltese residence card, home or tax registration settles the succession position. It does not. For deaths on or after 17 August 2015, the EU Succession Regulation generally points to the law of the deceased’s habitual residence at death, but habitual residence is a factual assessment based on the person’s overall life and connections.

The Regulation generally applies one law to the succession as a whole, including beneficiaries, shares, reserved portions and claims against the estate. It does not itself determine Maltese duty, foreign inheritance tax, tax residence or every procedure for releasing a particular asset.

For a recently relocated founder, executive or family, the relevant evidence may include the duration and purpose of the move, family life, work, social connections and the location of important assets. By way of exception, another state’s law may apply where the deceased was manifestly more closely connected with that state. That is an exceptional, fact-sensitive rule, not a general way to disregard a move to Malta.

Tax residence, habitual residence and domicile are different questions

Habitual residence is the succession connecting factor used by Article 21 of the EU Succession Regulation. It should be kept separate from Maltese tax residence, ordinary residence and domicile. Those concepts may overlap in the facts, but they answer different legal questions and should not be treated as interchangeable.

A residence permit, tax registration, Maltese property or company incorporation may be evidence in the wider factual assessment, but none automatically proves habitual residence for succession purposes. Families considering a move should keep a clear record of where each person lives, works, maintains family ties and holds important assets.

Can a foreign resident choose their nationality law?

In principle, yes. A person may choose the law of a state whose nationality they possess when making the choice or at death. A person with multiple nationalities may choose the law of any such state.

The choice must be made expressly in a disposition upon death or be demonstrated by its terms. It should be reviewed for form, validity and its effect on reserved shares, the disposable portion, lifetime gifts and claims against the estate under the chosen law.

Multiple nationalities create more choice, not necessarily less complexity. The family should identify the person’s nationalities at the time of drafting and at death, then coordinate the choice with the formalities and mandatory rules of the selected jurisdiction.

Spouses, descendants and Maltese reserved portions

Where Maltese law governs the succession, the Civil Code protects descendants and the surviving spouse through reserved portions. For all children together, the reserved portion is one-third where there are no more than four children and one-half where there are five or more, divided equally among the children participating in that portion.

The surviving spouse’s reserved portion is one-fourth of the estate in full ownership where there are children or other descendants, and one-third where there are none. These figures matter only if Maltese law governs the relevant succession.

The reserved portion is generally a right of credit against the estate, claimable in money after the applicable procedures. It should not be confused with a rule that every house, bank account or shareholding must be divided physically between the protected heirs.

What happens without a complete, valid will?

If there is no valid will, or if a will disposes of only part of the estate, intestate succession applies to all or the undisposed portion. The identity and shares of the heirs depend on the succession law governing the estate, not simply on where an individual asset happens to be located.

A Maltese will may be public or secret. A public will is received and published by a notary in the presence of two competent witnesses. A secret will involves sealing, delivery and preservation through the notarial and Civil Court process. Failure to comply with specified formalities can render a will null and void.

The Maltese Notarial Council states that a public will is registered with the testator’s personal details, while its contents are not entered in the Public Registry. A secret will is deposited through the notarial and Civil Court process. Wills should also be checked for revocation and consistency, particularly where documents have been signed in more than one country.

One Maltese will for worldwide assets, or separate local wills?

There is no safe assumption that one Maltese will controls every asset worldwide. The EU Succession Regulation generally addresses succession as a whole, but excludes or leaves separate questions for matrimonial property regimes, certain lifetime gifts, trusts, taxation, rights in rem and company-law matters.

A coordinated single will can sometimes be workable, while separate local wills may make administration easier for property or assets subject to local formalities. Separate wills must be drafted so that one does not unintentionally revoke or contradict the other. The Maltese Notarial Council notes that Maltese wills are generally cumulative unless revoked or inconsistent.

The Regulation does not bind the United Kingdom, Ireland or Denmark. It may still be relevant in a participating Member State in a case involving a person or asset connected with a non-participating country, but it does not replace the procedures of that country’s own courts, registries or institutions.

Maltese property, AIP treatment and the causa mortis process

A non-resident can generally inherit Maltese immovable property without an Acquisition of Immovable Property permit where the property devolves causa mortis and the statutory conditions are met. The exception covers inheritance; it should not be confused with the rules for a lifetime purchase by a non-resident.

For Maltese immovable property, succession is documented through a declaration causa mortis published by a notary and registered in Malta’s Public Registry. Each heir may make a declaration for their own share, and the deed must state the true value of the property or share being transferred.

MTCA states that causa mortis duty applies to immovable property situated in Malta and Gozo irrespective of the residence or nationality of the deceased or the heirs. The current declaration page states a basic rate of 5% on the property’s market value at the date of death, subject to exemptions, rebates and reduced rates, including a stated 3.5% rate on the first €200,000 in a specified sole-residence situation.

Timing matters. The current MTCA declaration page states that a €250 rebate may apply where the deed is concluded within six months of death and the duty does not exceed €2,300. It also states that failure to conclude the deed within one year incurs interest at 4% per annum and may affect eligibility for certain exemptions.

The official MTCA pages need to be read by date. The current declaration page states 4% per annum, while the older FAQ, marked as last updated on 18 September 2020, refers to 8% for earlier transfers and 4% for causa mortis transfers from 1 January 2020. The notary and MTCA should identify the applicable death and transfer dates before calculating interest.

Declared values can be reviewed. MTCA states that causa mortis transfers are vetted by assessors and an internal board, and that the Commissioner may seek an expert valuation or issue a claim where the declared value or duty calculation is not accepted. That is particularly relevant for high-value property, partial interests, usufructs and unusual market evidence.

A later sale of inherited Maltese property is a separate tax event. MTCA’s manual explains that the inheritance date, declared value and timing of the causa mortis declaration can affect the final-withholding-tax analysis. Duty dealt with at inheritance is therefore not the complete tax analysis for a later disposal.

Company shares and other assets need their own transmission analysis

Maltese limited-company shares are not dealt with solely through the immovable-property causa mortis process. MTCA states that causa mortis share transfers are subject to duty, with the relevant forms and share valuations submitted to the Property Tax Directorate for vetting.

Where the company whose shares are transferred owns property, MTCA may refer the case to an internal board and may seek an architectural valuation if the declared property value is not accepted. The transfer may also require company-record updates and other steps under the company’s constitutional documents.

Insurance policies, pensions, joint ownership, matrimonial property and trust interests may be governed by separate contractual, ownership, matrimonial-property, trust, pension, insurance or company-law rules. The result depends on the specific instrument, nomination, ownership structure and governing jurisdiction; none should be assumed automatically to fall inside or outside the estate.

Trusts and foundations should therefore be analysed alongside, but separately from, the will. The EU Succession Regulation excludes the creation, administration and dissolution of trusts, although succession law can still govern devolution where a trust is created by a will or statute in connection with succession.

The practical sequence after a death

The first step is to preserve the evidence: wills, identity and nationality records, residence history, marriage and birth documents, property deeds, bank and brokerage statements, company registers, insurance policies, pension nominations, trust documents and evidence of debts. A Maltese notary or succession lawyer can then map the assets and identify the likely governing law before transfers are signed.

The next stage is asset-by-asset execution: locate and verify the will, notify institutions, prepare the causa mortis declaration for Maltese property, address duty and valuation, complete any separate share-transfer forms, and deal with securities and financial accounts under their applicable procedures.

For Malta Government Stock, Servizz.gov states that relevant accounts may remain blocked until transmission or transfer is finalised. Bank accounts, listed securities, private-company shares, pensions, insurance and trust interests may each follow different contractual, corporate or regulatory processes.

For a cross-border estate, the team should decide whether a European Certificate of Succession, a foreign probate process or direct engagement with a foreign court, notary or land registry is needed. Availability, translation, apostille, resealing and asset-release requirements vary by country and institution, so they should be confirmed rather than inferred from the Maltese file.

What to document before relocating or acquiring Maltese property

Before a move, the family should record each person’s nationalities, intended residence pattern, domicile position as separately advised, family relationships, matrimonial regime, existing wills, trusts, foundations, insurance and pension nominations. It should also list assets by country and ownership form, including Maltese property, private companies, investment accounts and jointly held assets.

Before acquiring Maltese property, the family should test the inheritance exception, ownership structure, intended beneficiaries, potential reserved-portion claims, duty position and future-sale implications. A coordinated Maltese and foreign review is usually more reliable than a Malta-only will prepared without checking the other jurisdictions involved.

Questions people ask

Does living in Malta automatically mean Maltese succession law applies?

No. For deaths on or after 17 August 2015, habitual residence at death is generally the starting point under the EU Succession Regulation. A nationality-law choice, a recent move or an exceptional manifestly closer connection with another state may affect the result.

What is the difference between tax residence, habitual residence and domicile?

They are distinct concepts. Habitual residence is the connecting factor used by the EU Succession Regulation. Maltese tax residence and domicile may be relevant to other legal or tax questions, but neither automatically determines the succession law.

Can someone with more than one nationality choose which nationality law applies?

In principle, yes. Article 22 permits a person with multiple nationalities to choose the law of any state whose nationality they hold, provided the choice is properly expressed or demonstrated in a disposition upon death.

What reserved portions apply under Maltese law?

Where Maltese law governs, children together generally receive a reserved portion of one-third where there are no more than four children and one-half where there are five or more. The surviving spouse’s reserved portion is generally one-fourth where there are children or descendants and one-third where there are none.

Can a non-resident inherit Maltese property without an AIP permit?

Generally, a non-resident can inherit Maltese immovable property through succession without an AIP permit, subject to statutory conditions. This does not mean the same person can buy Maltese property during life without checking the applicable acquisition rules.

Does Malta have a separate inheritance tax?

The article should not be read as saying that inherited Maltese assets are cost-free. Maltese immovable property can attract causa mortis duty, generally based on market value at death and subject to exemptions, rebates and reduced rates. A later sale can create a separate tax event, while foreign inheritance taxes may also need to be considered.

What is a causa mortis declaration?

It is the notarial deed used to document succession to Maltese immovable property and register the transfer in Malta’s Public Registry. The deed states the value of the property or share transferred and forms part of the duty and registration process.

What late-interest rule applies to a delayed causa mortis deed?

The current MTCA declaration page states 4% per annum after one year. An older MTCA FAQ refers to 8% for earlier transfers and 4% for causa mortis transfers from 1 January 2020. The relevant death and transfer dates should be checked before calculating interest.

Are Maltese company shares dealt with through the property causa mortis deed?

Not necessarily. MTCA states that causa mortis share transfers are subject to duty and may require separate forms, share valuations, vetting and company-record steps.

Should a family use one will for assets in every country?

Not automatically. One coordinated will may work in some structures, but foreign property, company shares, matrimonial property, trusts, insurance, pensions and local registration rules can require separate analysis or local documents.