A rental contract (or rental agreement, or lease agreement) is a legal document between a landlord that rents a residential property to a tenant in exchange for payments. These rental contracts are legally binding contracts that explain the obligations and rights of the tenant and landlord. No matter if you are renting out an apartment, a villa, or a room within your own residence, you need to have a residential rental contract in place.
A rental contract is required by law, and it explains the responsibilities as a landlord and sets rules for the tenants. In Malta, the rental regulations are set out in The Private Residential Leases Act (Cap. 604 of the Laws of Malta). In the long terms, having a rental contract helps you avoid disputes with your tenants, and is a reference on how to fix problems when they happen.
There are various types of rental contracts, as we explain here:
Long let
- Minimal duration of one year
- The lessor and the lessee may agree on a longer lease contract (two years or more)
- First six months are mandatory for the lessee/s
- Following the obligatory six months, the lessee/s may be released from the contract by giving at least one month notice
- If the lessor does not intend to renew the lease, the lessee/s must be informed three months prior to the termination of the contract
- If the lessor fails to notify the lessee within the established period, the lease is renewed automatically for a year.
Short let
Leasing to temporary foreign workers, students pursuing short courses, foreigners who would not be seeking to establish residency in Malta, residents who need to lease a residency for a short period of less than six months.
- The lease duration is six months
- The first month of the lease is mandatory for the lessee/s
- Following the obligatory month, the lessee/s may be released from the contract but is obliged to give at least one week’s prior notice
- The contract cannot be renewed.
Shared residential spaces let
Leasing of a separate space in an apartment or building, with shared amenities like the kitchen and bathroom facilities.
- The lease duration is six months
- The lessee may be released from the contract at any time by giving one week’s prior notice
- The contract cannot be renewed.
It is important to include the following information and clauses in a rental contract:
- Names and passport/identity card numbers of landlord/s and tenant/s
- Address of the property being rented
- Intended use of property (residential or commercial)
- The duration of the lease, including start date and finish date
- The rent amount to be paid, and how and when it should be paid
- Note down water and electricity metre readings
- Security deposit the landlord will hold in case of damages
- Whether and how the rental agreement can be renewed
- An inventory outlining the conditions of the premises.
It is essential that the tenants are provided with a copy of the rental contract after signing it. Furthermore, all lease contracts for a primary residential purpose must be registered by the owner with the Housing Authority (Rent Registration) within ten days from the commencement of the lease. The quickest way to do this is by using the online facility by logging in with one’s e-ID. The normal registration fee is €10, and late registrations fee is €120. As an additional note it’s good to know that there are tax rebates on income for long term residential leasing. This rebate applies to contracts which have a minimum period two years, and the rebate amount depends on the number of bedrooms and duration of lease.
If you require assistance with rental contracts, and for any advice and disputes between landlords and tenants, Sciberras Advocates can assist with resolving issues amicably through out of court settlements.
This article is for information purposes only and should not be construed as legal advice.
Article written by Ms Charlene Sciberras, B.A. (Hons), guest writer, is a marketing and business administration specialist with a special focus on corporate, accounting, and legal matters.
Sciberras Advocates founded by Dr Adrian Sciberras, is a law firm based in Malta. The firm prides itself to be multi-disciplinary, innovative and flexible in order to meet the changing times and any challenges in the local and international legal scenario. No matter what private or corporate complex demands are called for, Sciberras Advocates offers practical and cost-effective legal solutions to achieve your desired results. You may reach Sciberras Advocates by phone on +35627795222 or via email on [email protected].
