Comparing Italy, Portugal, and Malta for Digital Nomads and Investors: Which Destination Wins in 2025?

As more professionals, entrepreneurs, and high-net-worth individuals (HNWIs) seek flexibility, lifestyle quality, and tax efficiency, Europe has become a top destination. Among its most appealing countries, Italy, Portugal, and Malta have emerged as preferred options for digital nomads, remote workers, and international investors looking for favorable residency and tax regimes.

Each country offers a unique blend of lifestyle, tax incentives, and visa programs—but which one is right for you? Whether you're planning to relocate your family, your company, or your capital, this in-depth comparison between Italy, Portugal, and Malta in 2025 will help you make a more informed decision.

Lifestyle and Accessibility: A Matter of Taste

Italy offers an unmatched cultural heritage, excellent healthcare, and a wide variety of climates—from the lakes of Lombardy to the beaches of Sicily. It’s ideal for those looking for both an inspiring lifestyle and access to world-class cuisine, art, and education.

Portugal has gained popularity among digital nomads thanks to its affordable cost of living, English-speaking environment, and strong expat community in cities like Lisbon and Porto. It's also highly regarded for its mild climate and safety.

Malta, though smaller, offers English as an official language, Mediterranean charm, and fast access to key European and North African markets. Its compact size makes it appealing to those seeking a simple, business-friendly base.

Visa and Residence Programs Compared

All three countries offer residency programs designed to attract foreign individuals and capital. But the conditions and scope vary significantly.

Italy offers several residency options, including the Elective Residency Visa (for those with passive income), the Investor Visa (for capital investment), and the increasingly popular Flat Tax Regime for New Residents, which has recently doubled to €200,000 per year. For entrepreneurs, Italy also has a dedicated Startup Visa Program for launching innovative businesses.

Portugal’s flagship program was the Golden Visa, but its real estate investment route has been discontinued. Now, investors must explore capital transfers or job creation. Portugal also offers the D7 Visa for passive income holders, which remains one of the easiest EU residence permits to obtain.

Malta runs a Permanent Residence Programme (MPRP) and a Citizenship by Naturalisation scheme through exceptional services. It is the only EU country that, under strict conditions, still offers a relatively fast track to citizenship via investment.

Tax Regimes: Flat Tax vs NHR vs Remittance Basis

Taxation is often the deciding factor for investors and expats. Here's how the three regimes compare in 2025:

Italy’s Flat Tax Regime allows new residents to pay a fixed €200,000 per year on all foreign income, regardless of the amount. This regime is particularly attractive for ultra-high-net-worth individuals with complex global portfolios. Italy also offers a reduced version (€100,000) for family members.

Portugal’s Non-Habitual Resident (NHR) Regime, previously one of the most popular in Europe, has undergone reforms. While it still offers reduced taxation on foreign pension income and exemptions on some foreign-source income, it's no longer the ultra-light system it once was. However, existing NHRs are grandfathered into the old rules.

Malta applies a remittance-based tax regime for resident but non-domiciled individuals. Foreign income is only taxed if remitted to Malta, and capital gains outside Malta are entirely exempt, even if remitted. This system can be extremely attractive for those with non-Maltese sources of wealth and careful structuring.

Cost of Living and Real Estate

Portugal remains the most affordable of the three in terms of cost of living, especially in smaller cities and rural areas. However, Lisbon and Cascais have seen sharp real estate price increases.

Italy offers great variation. While Milan and Rome are relatively expensive, regions such as Puglia, Umbria, and the lakes offer high quality of life at a reasonable price. The real estate market remains diverse and allows investors to take advantage of flat tax planning and succession strategies.

Malta has a high cost of real estate relative to its size and infrastructure, particularly in areas like Sliema and St. Julian’s. While the property market is active, it's less diversified than in Italy or Portugal.

Business and Banking Environment

Malta is known for its business-friendly legislation and ease of setting up international structures. Many crypto, finance, and online gaming companies have operations there.

Portugal, although relatively bureaucratic, has made strides in supporting startups through programs like Startup Portugal. It also offers tech visas and incentives for innovation hubs.

Italy has traditionally been more bureaucratic but is now catching up, especially through digitalization of services and startup incubators. Milan, in particular, is becoming a hub for fintech, family offices, and real estate investment strategies, especially among HNWIs relocating from the UK, UAE, and Switzerland.

Who Should Choose What?

Italy is ideal for those looking for long-term establishment, with global income and the desire to enjoy one of Europe’s best lifestyles under a predictable flat tax regime. It is also the best option for estate planning and building family structures using trusts, holding companies, and regulated investment vehicles.

Portugal suits those seeking flexible visas, affordability, and integration into a large English-speaking expat community. It remains a solid entry point into Europe, especially for passive income holders and early retirees.

Malta is best for those needing fast access, low-tax structuring, and a light-touch legal system, especially for business-related relocation or asset holding. It is particularly efficient for remittance planning and entrepreneurs who operate internationally.

Conclusion

Choosing between Italy, Portugal, and Malta depends entirely on your priorities: taxation, immigration speed, lifestyle, or investment structuring. Italy is positioning itself as the destination of choice for sophisticated investors, especially with the new €200,000 flat tax. Portugal continues to attract digital nomads, despite recent NHR reforms. Malta offers a strategic advantage for those in need of a low-tax EU base with fast pathways to citizenship.

At Knotted, we help individuals and families navigate this complex decision-making process, offering tailored advice on residency, taxation, relocation, and investment planning.

Considering a move to Italy or comparing your options?Reach out to us at info@knotted.ch or send a WhatsApp message to +41 76 771 30 22 for a private consultation with our cross-border specialists.