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2022 Special Incentives

Budget 2022 highlights for property buyers:

UCA grants and tax cuts, extension of stamp duty reduction for first-time buyers

Yesterday, the Government announced its budget for 2022, and one of the most notable measures introduced is the exemption from capital gains tax and duty on the first €750,000 of the value of properties which: were built over 20 years ago and vacant for more than 7 years are located in an Urban Conservation Area (UCA).

This exemption shall also apply to new properties built in a typical and traditional Maltese style and architecture.

Qualifying properties for which a promise of sale (konvenju) has already been entered into shall also benefit from this measure as long as the final contract has not been signed yet.

New incentives for first-time buyers

The budget speech also confirmed that the stamp duty exemption for first-time buyers on the first €200,000 of their property value will be extended once more.

First-time buyers who purchase properties qualifying for the scheme above can also apply for a grant of €15,000 to help restore their home, while buyers of similar properties in Gozo will receive a grant of double the amount at €30,000.

Moreover, current and prospective owners of qualifying properties may also benefit from a VAT refund of up to €54,000 on the first €300,000 spent on refurbishment works.

These measures entered into effect from the 12th of October 2021 for a period of three years.

Other measures for property buyers

The government has also announced that it will extend again the stamp duty exemption offered to first-time buyers on the first €200,000 of the value of the property, while second-time buyers will benefit from a refund of duty on the first €86,000 of the new property (the first €150,000 for people with disability or their guardians).

Transfers inter vivos of residential properties in Gozo will be chargeable at a rate of duty of €2 for every €100, or part thereof.

The reduction of stamp duty rate to 1.5% on the first €400,000 of the property value and lowering of income tax on capital gains to 5% on property transfers will not be renewed and shall expire in June 2022.

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