Tax Relief on Purchase and Renovation of Older Properties

As part of the 2022 Budget, tax waivers for persons who purchase residential properties which have been built more than 20 years ago, purchase properties in the Urban Conservation Area, have been introduced. With regard to those properties built over 20 years ago, this scheme shall only apply if the property in question has been vacant for at least seven years. This same benefit also extends to new properties which are being built in a ‘typical Maltese Style’ in line with established guidelines. A guideline for this purpose has not yet been published, however, a committee has been composed that is tasked with assessing applications and determining whether they are eligible. Properties falling under the aforementioned categories which are still under a promise of sale agreement. This scheme is capped up to the first €750,000 of the value of the property, on which no duties or capital gains tax will be charged.

An additional grant is also available to first-time buyers purchasing such properties. First-time buyers are also eligible for a grant of €15,000, which grant shall rise to €30,000 for first-time buyers who purchase such property in Gozo.

As part of this scheme, the persons who renovate any properties falling under the aforementioned categories shall be eligible for a VAT refund of up to €54,000 on the first €300,000 spent on renovation works. In order for works to be eligible under the VAT refund scheme, works must have commenced after the 12th of October 2021 and must relate to, amongst others, restoration, or interior or exterior finishing of the property. VAT refunds shall not be awarded for any demolition works, alterations, additions or improvements that do not qualify as restoration or finishing. Furthermore, properties that seek to benefit from this grant cannot be divided, and should the property be re-developed into separate residential units, then the applicant shall be required to pay back the full amount.

In order to be eligible under this scheme, the applicant must be a Maltese resident who is over the age of 18 and is in possession of a property that is used, or is to be used, as a private residence. This scheme is set to remain open until December 2024.

For further information kindly send an email to
EMD can assist you in assessing whether your property is eligible for the aforementioned grants and shall be able to assist you in applying for such grants.