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Tax News

An undertaking that carries out a research activity relating to science and technology may be eligible for a tax credit, provided certain conditions are satisfied and the application is approved by Malta Enterprise ("ME"). A tax credit or a cash grant may be granted to an undertaking in order to…
This scheme entails employers, including self-employed individuals, who as from 2014 employ persons aged between 45 and 65, and who have been on the unemployment register for the preceding 6 months on Part 1 or Part 2 prior to the employment.  Employers will have a tax deduction of a maximum of…
EEA and Swiss nationals who have availed himself from the Highly Qualified Person Rules shall be eligible for a one-time extension of 5 years. The individual has to apply for this extension and must continue to adhere to the conditions laid in the Highly Qualified Person Rules. The extension is…
The Regulations are applicable to purchases, made by non-resident travelers, of goods taken out of the Community in their personal luggage on or after the 1st May 2004. Non-resident travelers are travelers whose domicile or habitual residence is not situated within the Community, who on the day of departure, had…
The Commissioner may, at his discretion, remit wholly or in part any interest and penalty chargeable on any person relating to duty payments. Provided that the Commissioner may only remit such interest and penalty if he is satisfied that the duty due was not paid within the prescribed period due…
The following allowances and benefits, payable under the Social Security Act and any other non-contributory allowances and benefits, payable under the Social Security Act, are exempt from the payment of income tax: Allowances or Benefits Relevant                            …
The following tax credits shall be deemed to have come into force as from year of assessment 2016: - a tax credit of €2,000, wherein the woman opts for the married rates and is taxable jointly with her spouse - a tax credit which may not exceed €5,000, in case…
As from 1st January 2014, the de minimis aid granted to a single undertaking shall be applicable to an undertaking carrying on or intending to carry out an activity that may contribute to the economic development of Malta if such undertaking requests assistance to achieve qualifying certifications. The total amount…
  Legal notice 117 of 2015 has been recently introduced covering Amendments to the Personal Retirement Scheme Rules issued in 2015. In summary these rules provide for a tax credit with respect to any personal retirement scheme or policy of insurance. The synopsis of these rules are listed below: A…
Legal Notice 75 of 2015 was recently published, which extends the scope of the Remission of Interest Rules of 2014 to cover remission of Administrative Penalties as well. Through the Remission Rules, the Commissioner may, at his discretion, remit wholly or in part any interest and administrative penalties incurred by…
The Inland Revenue Department is sending out cheques for the one time additional bonus to employed persons who did not benefit from the reduction in the income tax rates. The eligibility to this bonus is based on employment income earned during 2013.Some individuals may still be eligible to this bonus…
Applicable to - Persons with undeclared rental income earned during calendar years 2005 to 2012. The Scheme – Persons who have not declared their rental income derived from a tenement leased as a residence or garage during 2005 to 2012 may now do so and pay a flat rate of…
The Convention between the United Mexican States and Malta for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income published as a Schedule to Legal Notice 239 of 2013 has entered into force on 9 August 2014 pursuant to Legal Notice 332…
The Foreign Account Tax Compliance Act (FATCA) agreement between Malta and the United States entered into force on 26 June 2014. The agreement was signed on 16 December 2013 and is based on a Model 1A, whereby the U.S. agreed to implement Foreign Account Tax Compliance provisions (commonly known as…
The definition of ‘emoluments’ of the Final Settlement System Rules has been amended by means of Legal Notice 260 of 2014.   As from year of assessment 2015, the following income shall be considered as ‘emoluments’ for income tax purposes: i. any income relating to any pension, charge, annuity or…
Applicable date: The Scheme runs until 30 September 2014   Applicable to: Residents of Malta subject to tax in Malta (whether individuals or companies) who hold ‘eligible assets’ who want to regularize their position under the Income Tax Act by registering such assets under the Scheme.   Eligible Assets: These…
Budget 2014 brought in changes to the taxation system applicable to income from the letting of immovable property in Malta for residential purposes. Prior to this change, tenants were subject to tax on the rental income less the deductions provided for by Maltese tax legislation at their marginal tax rates…
The part time income rules have been revised through LN 185 of 2014 and LN 186 of 2014. The following rules will be effective from year of assessment 2015. Individuals Eligible to benefit from the Part time Income Rules • Individuals receiving full-time instruction at a university, college or other…
Applicable date Applicable with effect from Year of Assessment 2015 with respect to employees engaged on or after 1 January 2014. Eligible Persons Employers (self employed and companies) who provide employment to an individual whose age is between 45 to 65 years and whose name appears on the unemployment register…
Applicable date Applicable with effect from Year of Assessment 2015 with respect to work placements and apprenticeships on or after 1 January 2014. Eligible Persons Employers (self employed and companies) who provide work placements or an apprenticeship. Deduction The deduction available to eligible employers will be equivalent to Euro 600…
Legal Notice 361 of 2013 introduced the possibility of the remission of interest charged with respect to late payment of the tax liability by the Commissioner of Inland Revenue in terms of Article 44(2A) of the Income Tax Management Act. Remission of Interest The Commissioner, may at his discretion, remit…
Applicable to Individuals and Companies Allowable Deduction Donations (in monetary amount or in any other asset or in kind) made by an individual or a company to the University Research Innovation and Development Trust will be an allowable as a deduction against that person's chargeable income (in the year it…
Applicable to Individuals and Companies Allowable Deduction Donations (in monetary amount, in any other asset or in kind) made by an individual or a company to the Creativity Trust established by the Creativity Trust order will be an allowable as a deduction against that person's chargeable income (in the year…
Rental Income Received from the Housing Authority - Article 31 A of the ITA  The introduction of Article 31 A was included in the ITA via Act V of 2012.   This Article deals with rental income received from the Housing Authority.  A beneficial tax rate of 5% will be levied…
Recent amendments to the Duty on Documents and Transfers Act (Cap 364 of the laws of Malta) have been announced in the last budget, which were targeted to various individuals. Furthermore, various forms of tax relief have been granted, including a duty relief to individuals who acquire their first immovable…
A measure announced during the Budget Speech for 2011in respect of full-time farmers and breeders concerning reduction in the social security contributions was finally made legal through Legal Notice 455 of 2011. The essence of the measure consists of a reduction in the rate of social security contributions payable by…
In his Budget Speech for 2012, the Minister of Finance has yesterday evening laid out the key objectives in weathering the international financial storm by maintaining financial and economic stability, yet attracting foreign investment, creating new jobs as well as safeguarding existing jobs and strengthening of the social welfare. With…
The new residence scheme entitled The Global Residence Programme is being launched by the Government. The legal notice will be issued by the end of this month. These are the highlights of the scheme: it addresses Non-EU, Non-EEA and non-Swiss nationals only; the bond under the HNWI scheme will no…
Switzerland and Malta have signed a new Double Tax Agreement, designed to further the positive development of bilateral economic relations and foster the exchange of information. Signed on February 25, Switzerland and Malta agreed withholding tax exemption for dividend payments in the case of related companies with a capital stake…
The magazine International Living rated Malta's climate as the best in the world: "...with 5.2 hours of sunshine a day, a stable government and economy, Malta is a very strong draw for expats. And it’s English-speaking.” Malta is our favorite, says International Living magazine Editor Eoin Bassett. http://internationalliving.com/2011/01/07-ils-2011-quality-of-life-index-reveals-best-climate-in-the-world/
Malta recently implemented a new aircraft registration regime, structured in a manner to accommodate efficient registration of smaller aircrafts, in particular business jets. The Aircraft Registration Act addresses several important issues such as different types of registrants, the concept of fractional ownership and the protection of creditors and special privileges…
In an effort to continue strengthening its attraction as an IP jurisdiction, Malta has recently introduced an exemption on royalties and income derived from certain types of patents. Any income or royalties derived by a Maltese company from a qualifying patent in respect of an innovation are exempted from tax…
Yesterday evening the Minister of Finance, the Economy and Investments presented the Budget for 2011 in Parliament. During the Budget Speech he outlined the main priority areas for government and gave a review of the performance of the Maltese economy. He laid on the Table of the House of Representatives…
On the 27th of July 2010, the Italian Ministry of Finance has signed a decree removing Malta from Italy’s list of black-listed jurisdictions applicable to its controlled foreign company (CFC) legislation. This positive development should encourage more flows of capital and investment between these two States and moreover the use…
The US Senate has approved the Malta – USA double tax treaty signed on the 8th of August 2008. Malta’s Minister of Finance has described this step as a “critical step in deepening Malta’s relationship with the USA, not only at the political and social levels, but also in trade…