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Application Process and Tax Credits
We recommend that you submit your application as early as possible. For key deadlines contact us.
No, Section 1.3 of the Incentive Guidelines states that an undertaking that submits a claim by the March deadline may not submit another claim in November of the same year.
The 45% (or 65% for Gozo based undertakings) rate is used for calculating the value of the tax credit. If your eligible costs amount to €10,000 your tax credit would be €4,500 (that is 45% of €10,000). This tax credit may then be applied on your final tax bill after any other regulatory deductions.
The tax credit must be utilised by the third year of assessment, while for start-ups, the tax credit must be utilised by the fifth year of assessment (i.e. for certificates issued in respect of Year of Assessment 2018, the tax credit must be utilised until year of assessment 2020). (i.e. for certificates issued in respect of Year of Assessment 2018, the tax credit must be utilised until year of assessment 2022).
No, VAT is not an eligible cost under this scheme. Tax credits will be granted on the net value of a cost item (excluding VAT).
Applicants who have applied for an investment aid measure (such as the Investment Aid Tax Credits 2014 – 2020) may not apply for this incentive within the same year.
Eligible Undertakings
Business activities that are not required to register with the VAT department can apply for this tax credit as long as their application is related to the carrying out trade or business activity which is exempt from registering with the VAT department.
Yes, a Maltese company operating mainly outside Malta is eligible. However, tax credits will only be granted on costs which can be verified in Malta. (For verification and control purposes, you may be requested to transport back to Malta any equipment assisted.)
No. Applicants must employ at least one person at application stage in order to be eligible for this incentive. A company with no employees cannot benefit from this incentive as per Section 3 of the Incentive Guidelines.
Yes, providers of (non-voluntary) professional services are eligible.
No. Voluntary organisations are not eligible as per Section 6.2 of the Incentive Guidelines.
A ‘start-up’ can be defined as an undertaking that has been established for less than four years as determined from date of registration with the Malta Financial Services Authority (MFSA) or the date the person registered as a self-employed with Jobsplus as per Section 2.2 of the Incentive Guidelines.
As per Section 2.3 of the Incentive Guidelines, a female-owned undertaking is an undertaking in which more than 50% of the stock is owned by one or more women or a female self-employed person.
With regards to Motor Vehicles, if an applicant is working within the car rental sector, the applicant may claim the costs related to an investment in one new motor vehicle (or first time registered/used in Malta) as long as such vehicle is involved in the carrying of goods, Special Purpose Motor Vehicles (as defined in the Incentive Guidelines Section 2.5.) and vehicles designed specifically for the carriage of ten or more persons.
If the undertaking has a relation as described in Section 2.1 of the Incentive Guidelines it is considered to be a single undertaking.
The definition should be taken in the context of the de minimis regulation. The notion of linked and partner enterprise is relevant to determining the size of an undertaking.For further information contact us on [email protected]
Eligible Costs
No. In order to be eligible the motor vehicle must be new and purchased in 2017 or first time registered in 2017.
Cost for the purchase of computers, software and other ICT equipment required to operate or improve the business are eligible.
No. Operating costs such as rent, electricity bills, and telephony and internet costs cannot be supported through this incentive.
No. Only capital investment in IT is eligible under this scheme. Any maintenance costs are ineligible.
As from 2018 (for costs incurred in 2017), the cost for the purchase of commercial vehicles having the latest European Emission Standard rating (currently Euro 6, 2014), purchased to replace similar vehicles will be considered eligible.
Vehicles such as Isuzu Trooper, Mitsubishi Pajero, Mitsubishi Shogun, Land Rover Defender, Land Rover Discovery, Land Rover Freelander and Toyota Landcruiser or other similar vehicles, will not be eligible due to their recreational attributes.
No, all costs claimed must related to items purchased for the business.
PV systems are eligible if connected to a commercial meter located at the applicants licensed business premises. For details about other energy saving systems, please contact [email protected]. Applicants must present the Malta Resources Authority (MRA) permit to generate electricity and their last electricity bill (on which the system is connected). Systems which help to save energy or produce alternative energy are eligible but must be related to a licensed business premises as specified in the trade licence issued by the commerce division or the permit issued by the Planning Authority (PA).
No, vehicle registration tax paid on second hand vehicles is not eligible.
Individual invoices having a value of less than €200 is not eligible.
Yes, the invoice needs to clearly indicates both the supply of material and installations in order to be eligible.
Permits and licences identifying the premises as a business premises will be accepted.
All invoices and fiscal receipts must include all details stipulated by the vat department, however these do not need to be provided along with the application. In cases were these are not provided the transactions section of the application must be verified and signed by CPA. FS7s are always required when dealing with wage costs and the transaction must also be verified by a CPA.
Yes, you can claim these costs if the receipts presented contain the following information:
Date of supply;
Name, address and ID number of supplier;
Name, address and VAT registration number (if applicable) of customer;
Details of the supply made;
The price before and after any discount (clearly showing final price);
A note indicating that the issuer of the receipt is not registered under VAT in line with LN500 of 2010.
For more information contact [email protected]
Undertakings registered in 2017 are eligible to apply for wages.
Employment and Linked Enterprises
Yes, you may apply for a tax credit through this incentive. You may claim tax credit received through this incentive as any other self-employed but you will not be able to submit Tax form TA22 and hence shall not be able to benefit from the 15% tax rate. To utilise these tax credits you will have to declare any income in your Income Tax Return.
The tax credit is redeemable against income generated from your business activity or trade only.
I am part-time self-employed and I do not employ anybody. Do I qualify for this assistance?
This depends on the number of employees employed with each undertaking. 1st January 2018 saw a change in the system where applicants must be an undertaking that for a consecutive three month period (during the year in which the costs were incurred) did not employ more than fifty persons on Full Time contracts. All data used to verify this condition is provided by Jobsplus.
Yes. The applicant must be an undertaking that for a consecutive three month period during the year in which the costs were incurred did not employ more than fifty persons on Full Time contracts. Data used to verify this condition is provided by Jobsplus.
If the partnership is not registered, an agreement signed between the partners, specifying the profit sharing percentage of each partner needs to be submitted. The agreement must be signed prior to any investment being claimed for but all unregistered partnership agreements have to be notarised.
Yes a family business which is duly registered as a family business (as defined in section 2.4 of the Incentive Guidelines) can qualify from the scheme as of year 2018.
The applicant must be an undertaking that for a consecutive three month period during the year in which the costs were incurred did not employ more than fifty persons on Full Time contracts. Data used to verify this condition is provided by Jobsplus.
