Portugal vs Malta: Non-Habitual Resident vs Global Resident

A tax-focused, data-driven matchup

Sometime around my third espresso in Lisbon this spring, yet another client asked the eternal question: “Should I keep chasing the Portuguese NHR bandwagon or pivot to Malta’s Global Residence Programme instead?”

Both regimes promise Mediterranean sunsets, English-speaking accountants and headline tax rates that make Berlin rinse-and-repeaters cry. But the devil, as any EU tax advisor will tell you, is hiding somewhere between line 3C of your foreign dividend statement and the exit day you never planned for.

Below is the long-form breakdown I wish I could hand to every would-be émigré: a no-nonsense, numbers-first comparison of Portugal vs Malta—sprinkled with first-hand anecdotes, cautionary tales and the odd dry joke to keep the caffeine flowing.

Table of Contents

1. Who should read this
2. Qualifying criteria
   2.1 Portugal—Non-Habitual Resident
   2.2 Malta—Global Residence Programme
3. Effective tax rates: three real-world demos
4. Other levies: wealth, inheritance & social security
5. Exit scenarios & planning traps
6. Secondary passport impact
7. Decision matrix & next steps

“Tax regimes are like yachts: they look gorgeous from the pier, but maintenance costs decide whether you’ll still love them in five years.”
—Field notes, 2024 client debrief

1. Who should read this

• EU/EEA nationals with high mobile income: software founders, traders, consultants, crypto folk.
• Non-EU investors eyeing an eventual EU passport with a side order of lifestyle upgrade.
• Retirees chasing sunshine and dividend-friendly jurisdictions.
• Professional advisers wanting a cheat-sheet (you’re welcome).

If you’re after a broader European buffet, check our head-to-head on lump-sum regimes—Switzerland vs Italy—or the southern non-dom face-off, Greece vs Cyprus.

2. Qualifying criteria

2.1 Portugal—Non-Habitual Resident (NHR)

Portugal’s NHR was born in 2009, tweaked in 2020 and (depending on the draft state budget you read) allegedly “sunsetted” in late 2024 for newcomers. Reality check: a successor regime aimed at “high value” talent is expected, but under current law you can still grandfather NHR status if you:

1. Become tax-resident in Portugal (183 days or a habitual home) but
2. Have not been tax-resident in Portugal in the previous five years.
3. Apply for NHR status by 31 March of the year following arrival.

Upfront costs: €0 in government fees; lawyers may charge €800–€1,500 to shepherd the formalities.

2.2 Malta—Global Residence Programme (GRP)

Malta loves acronyms. The GRP (2013) replaced the old “permanent residence” and is distinct from the HNWI Rules, RVP, MEIN, etc. To qualify you’ll need:

1. Third-country national status (EU/EEA/Swiss need the “Ordinary Residence” or NHR Lite).
2. Purchase real estate worth €220,000–€275,000+ (south of Malta/Gozo) or €275,000–€330,000+ (rest of island) or rent at €8,750–€9,600 p.a. minimum.
3. Annual minimum tax payment €15,000, credited against 15 % tax on foreign-source income remitted to Malta.
4. Fit-and-proper test & private health cover.

Government fees: one-off €6,000—or €5,500 if property in Gozo/the south.

Quick takeaway: Portugal asks for time in the country; Malta asks for property and a fixed minimum tax cheque.

3. Effective tax rates: three real-world demos

Numbers speak louder than regime brochures. I’ve modelled three archetypes—Software Founder Fred, Portfolio Paula and Crypto Chris—each earning €1 million but from different buckets. Exchange rate €1 = same (we’re in Euroland).

Let’s run the scenarios.

3.1 Software Founder Fred

• €400k salary paid by own Estonian OÜ
• €600k dividend from same OÜ

Portugal NHR
– Salary qualifies as “high value” activity: 20 % = €80k
– Dividend 0 % if DTAA applies and OÜ not blacklisted
Total Portuguese tax: €80k ⇒ 8 % effective

Malta GRP
– Salary taxed 0 % if left offshore; Fred needs funds so remits €150k for living costs
– Remitted portion 15 % = €22.5k (plus €15k minimum)
Total Maltese tax: €37.5k ⇒ 3.75 % effective

Takeaway: Malta wins if you can keep big chunks offshore. Portugal wins if you need to live on a large salary.

3.2 Portfolio Paula

• €1m dividends from US blue-chips, all remitted for living.

Portugal NHR
– US dividends 0 % because US-PT treaty + foreign tax credit
Total: 0 %

Malta GRP
– All remitted ⇒ 15 % = €150k (capped? No) plus €15k minimum already met
Total: 15 %

Paula should stay in Cascais.

3.3 Crypto Chris

• €1m long-term capital gain on BTC sold after 370 days, funds wired for yacht.

Portugal NHR
– Long-term crypto gains 0 % post-2023 transitional rules still grandfather prior holdings
Total: 0 %

Malta GRP
– Crypto considered “intangible”; capital gains 0 % non-remitted, but Chris wants the yacht in Valletta, so remits full €1m ⇒ 15 % = €150k
Total: 15 %

Another Portuguese victory—so long as the law remains lenient.

4. Other levies: wealth, inheritance & social security

• Wealth tax: Portugal has a slender IMI/Adicional IMI on Portuguese real estate only (0.7 % over €600k fiscal value). Malta—none.
• Inheritance/gift: Portugal zero between spouses/children; 10 % stamp to others. Malta: no inheritance tax, only transfer duty on Maltese immovable property shares.
• Social security:
– Portugal: mandatory contributions on Portuguese payroll; foreign company PE exposures exist; voluntary scheme possible for freelancers.
– Malta: Class 1 SSC 10 %, capped ~€4,400 p.a.; avoidable if income stays offshore.

5. Exit scenarios & planning traps

Portugal

1. NHR status lasts 10 years; after that you fall into mainstream progressive rates up to 48 %.
2. No formal exit tax for individuals yet, but EU ATAD3 “unshell” rules loom; watch out if you hold >2 m unrealised gains inside foreign entities.
3. Capital gains on shares in unlisted companies become taxable once you turn ordinary resident, so plan liquidity events during the 10-year window.
4. Non-habitual but resident years count towards the 5-year clock for citizenship.

Malta

1. GRP is indefinite provided criteria met; 15k minimum tax endures.
2. To terminate, surrender status and notify Commissioner within 1 month; future Maltese-source income taxed at progressive 0–35 %.
3. No exit tax on individuals, but CFC rules can bite once domiciled.
4. Years under GRP do not count towards Maltese ordinary residence needed for standard citizenship; you must switch regimes or pursue MEIN (€600k+ donation route) for a passport.

6. Secondary passport impact

Holding a Plan B passport is not purely collector’s ego—it directly shapes tax exposure.

Portugal

• After 5 years of legal residence (NHR counts), you can apply for naturalisation with A2 Portuguese knowledge.
• Once you hold the passport, you may relocate again without losing EU mobility.
• Portugal does not tax non-residents on foreign income, so you can obtain the passport, move on, and sidestep worldwide taxation.

Malta

• GRP alone gives you a residence card, not citizenship.
• Citizenship by “Naturalisation for Exceptional Services by Direct Investment” (MEIN): €600k–€750k contribution + €700k property + €10k donation; typical timeline 12–18 months.
• Malta taxes on domicile + residence concept; new citizens often remain non-dom — meaning foreign income kept offshore stays untaxed. However, the optics of “passport investors” can shift policy quickly—keep contingency plans.

7. Decision matrix & next steps

Practical tip: Many clients run a two-step strategy—start in Portugal, harvest gains, apply for citizenship, then toggle to Malta (or elsewhere) for perpetual 0–15 %. Timing the switch before year 11 of NHR avoids ordinary PT rates.

Call-out block:
Thinking of stacking regimes? Always model tie-breaker rules (OECD Article 4), or you may end up dual-resident and paying both minimums with zero benefit.

Final thoughts

Choosing between Portugal’s NHR and Malta’s GRP isn’t a coin flip—it’s a personal equation of income mix, remittance needs, lifestyle quirks, and succession plans. Run the numbers, road-test the culture, and—most importantly—sketch an exit timeline before you even arrive.

Ready to see which Mediterranean base slashes your tax bill without torching compliance bandwidth? Generate a bespoke projection in minutes by starting your free relocation plan on BorderPilot today.