Property in Malta

Budget 2027 for Malta Businesses: Premises, Tax and Fit-Out

29.10.26 | QuickLets

Most business owners read the Budget 2027 coverage and saw new costs: higher work permit fees, a bigger tourist tax and charges for foreign workers. For a growing company planning to move, expand or fit out premises, the same budget proposes a lower tax rate on reinvested profit, keeps energy prices frozen and continues Malta Enterprise schemes. Checked 29 October 2026; measures from the 26 October 2026 speech apply only once enacted.

In short: Budget 2027 proposes 25 percent corporate tax instead of the standard 35 percent rate on profits that a company with turnover up to €1 million retains or reinvests, subject to rules not yet published. Malta Enterprise schemes continue; the updated Micro Invest scheme is a tax credit claimed against tax of 65 percent of eligible costs, or 85 percent for a business in Gozo. Energy prices stay frozen, and on commercial lease law the speech did not announce a change.

For what a lease costs beyond the rent, read our guide to renting office space in Malta, and for permitted uses see the guide to commercial use classes.

What does the 25 percent rate mean for a growing company?

More cash stays in the business when you reinvest. The standard corporate tax rate remains 35 percent, while 25 percent is a proposal for retained or reinvested profit of companies with turnover up to €1 million (EY Budget 2027 highlights, p. 5). The rules are not published, and dividends stay at 35 percent at company level.

Profit kept in the company	Tax at 35 percent	Tax at 25 percent	Extra cash kept
€50,000	€17,500	€12,500	€5,000
€100,000	€35,000	€25,000	€10,000
€200,000	€70,000	€50,000	€20,000

Figures are before imputation refunds, the rules for the 25 percent proposal are not published, and dividends stay at 35 percent at company level. €10,000 of extra retained cash can help fund a lease deposit or part of a fit-out. Within the QLZH group, Zet Finance advises on this. See its Malta corporate tax page for how retained and distributed profits are treated.

Can your premises investment qualify for a Micro Invest tax credit?

Micro Invest is a tax credit claimed against tax, not a payment towards the fit-out and not a payment to the contractor. It is not a new Budget 2027 measure: the updated scheme was published on 11 May 2026 for eligible costs from 1 January 2026, and applications open on 1 January 2027 (Malta Enterprise; Deloitte Malta), while Budget 2027 said Malta Enterprise schemes continue. In the Malta Enterprise guidelines, the rate is 65 percent of eligible costs, and 85 percent for a business in Gozo. The cap is €65,000 over three years, plus €20,000 for one of these categories: Gozo, a family business, a female-owned business, or a social enterprise (the guidelines use "or", so the uplifts do not stack).

Eligible refurbishment still needs a bill of quantities certified by a perit and proof of title to premises used only for the business, and the credit is claimed against tax. If you lease, confirm with Malta Enterprise how your lease meets the title condition. Our offices in Malta, including offices in Sliema and offices in St Julians, include spaces that suit a fit-out, and our guide to Sliema and Mriehel offices compares occupancy costs.

What stays the same?

Energy prices stay frozen, backed by about €400 million, which matters most for kitchens, cold stores and warehouses.
Tax rates: on headline income tax rates, VAT rates and social security contribution rates, the speech did not announce a change.
Lease law and duty: on commercial leases and stamp duty rates, the speech did not announce a change.

What new costs should businesses plan for?

Measure	Who it affects
Work permit fee from €600 to €800, plus €400 a year	Employers of non-EU staff in catering, hotels and logistics
Eco-contribution €8 a night in hotels, capped at €64 per person, from 1 January 2027	Hotel and guesthouse guests aged 18 and over
VAT invoice penalties of €100, €200, €400 and then €500	Any VAT-registered business
VAT reverse charge in construction	Contractors and business clients on covered construction works
Full-value tax on airspace transfers	Owners and developers selling airspace

Sources: EY highlights, pp. 5, 7, 9 and 11, and The Malta Independent. For shops and catering premises in Malta, invoice compliance is the one to fix now before the revised penalties apply. Our guide to catering permits and leases covers the premises side.

What does it mean for hotels and guesthouses?

Guests aged 18 and over pay the eco-contribution and operators collect it once enacted. The short-let rate of €10 a night (cap €80 per person) is higher than the €8 hotel rate (cap €64 per person), which slightly favours licensed collective accommodation, and English language school accommodation is exempt. The MHRA called the increase too steep. See what an MTA licence transfers on a sale and our hotels and guesthouses.

Questions business owners ask

Is Malta corporate tax now 25 percent?

No. The standard rate is 35 percent. The 25 percent rate is a proposal only for retained or reinvested profit of companies with turnover up to €1 million, under rules that are not published, and dividends stay at 35 percent at company level.

Can a tenant claim a Micro Invest tax credit on a fit-out?

Possibly. The guidelines require proof of title to premises used only for the business and a bill of quantities certified by a perit, and the credit is claimed against tax rather than paid to the contractor, so check with Malta Enterprise how your lease qualifies before works start.

Did Budget 2027 change commercial lease rules?

No. On commercial lease rules, the speech did not announce a change.

Are energy prices frozen for businesses too?

Yes, for 2027.

Next step

If the budget makes a move possible in 2027, start with the space. Browse offices, shops and showrooms or warehouses, and tell us what you need. We will shortlist premises that suit the use class and the fit-out you have in mind.