VALUE ADDED TAX ACT

CHAPTER 406

VALUE ADDED TAX ACT

To make provision for the imposition of a value added tax in place of an excise tax system

on imports, products and services.

1st January, 1999

ACT XXIII of 1998, as amended by Legal Notices 17, 21, 22, 28, 29, 30, 60, 89, 116, 142,

198, 199, 200, 201, 217, 223 of 1999, 11, 271, 272, 273, 274 of 2000, 23, 24, 25, 93, 94 of

2001; Act VI of 2001; Legal Notices 149, 171, 233, 234, 235 of 2001, 180, 205, 387, 388, 389

of 2002, 39, 375, 384 of 2003, 149 of 2004; Acts X of 2003, II, III of 2004; Legal Notices 250,

376, 436, 489, 520 of 2004; Act XIII of 2005; Legal Notices 171, 181, 186, 334 of 2006; Acts

IV, XIX, XXXII of 2007; Legal Notices 121, 122, 123, 124, 426, 443, 444, 445, 446, 447 and

448 of 2007, 105, 335 of 2008, 34, 86, 132, 133, 137, 234, 235 of 2009; Acts II of 2009, I of

2010; Legal Notices 71, 72, 73, 286, 425, 444, 499, 523, 532, 533, 534, 535, 536 of 2010, 61,

234, 379, 380, 381, 382, 499, 500 of 2011; Acts IV, V, XXII of 2011; Legal Notices 38, 39, 89,

185, 418, 419, 420, 421, 422, 423, 424, 425, 426 of 2012; Act V of 2012; Legal Notices 64,

140, 141, 142 of 2013; Acts III, XIV of 2013; Legal Notices 236, 345, 422 of 2013, Acts XII,

XLIII of 2014; Legal Notices 480 of 2014, 64, 65, 227, 231 of 2015; Act XIII of 2015; Legal

Notices 43, 247, 383 of 2016; Act XV of 2016, Legal Notice 347, 348 of 2017, 9 of 2018,163 of

2018, 297 of 2018, 298 of 2018 299 of 2018,434 of 2018 and VII of 2019.and Legal Notices

155 of 2019, 302 of 2019 and 250, 251, 252 and 253 of 2019 and 186, 219, 220, 221, 222, 223,

224, 225, 226, 463 and 477 of 2020 and 4, 5 and 5, 241 of 2021 and 358 of 2021 and 138 and

140 of 2022 and Acts VIII of 2020, VIII of 2021 and VII of 2022 and XII, XXVII and XXXV of

2023.and Legal Notices 231 of 2023 and 12, 228, 344, 345, 346, 347, 348, 349, 350, 354 and

355 of 2024 and Acts XIII and XXXVIII of 2024. and IX and XXX of 2025 and Legal Notice 88

of 2025and Act III of 2026 and Legal Notice 75 of 2026.

The short title of this Act is the Value Added Tax Act.

Amended by

L.N. 198 of 1999;

[Article 5(3)]

L.N. 387 of 2002.

Substituted by

Activities of Public Authorities

X. 2003.47.

Amended by

L.N. 489 of 2004.

The activities listed in the second column of the public authorities listed in the

first column of this Schedule shall be deemed to be activities performed in the course

or furtherance of an economic activity.

First column

Second column

Public authority

Activities

Malta Drydocks Corporation

All activities

Mediterranean Conference Centre

All activities

Any public authority

Sale of leaded petrol, unleaded petrol and

diesel (gas) oil, kerosene, bottled gas and the

supply of electricity and the supply of steam;

The supply of water and gas;

Production and sale of numismatic coins and

medals;

Telecommunications;

The transport of goods;

Port and airport services;

Passenger transport;

Supply of new goods manufactured for sale;

The transactions of agricultural intervention

agencies in respect of agricultural products

carried out pursuant to Regulations on the

common organisation of the market in these

products;

The running of trade fairs and exhibitions;

Warehousing;

The activities of commercial publicity bodies;

The activities of travel agencies;

The running of staff shops, co-operatives and

industrial canteens and similar institutions;

Transactions of a commercial nature of radio

and television bodies;

Private hire of patrol boat, helicopter and

equipment;

Inspection of ships’ hulls by divers;

Security duties with banks and similar

activities;

Provision of meteorological services;

Book binding;

Sale of bread;

Sale of impounded motor vehicles;

The provision of accommodation facilities to

visiting youths, student groups and

individuals;

Sale of drugs and vaccines;

Sale and cleaning of grave sites;

Laboratory analysis;

Te s t i n g f o r s t a n d a r d s a n d i s s u i n g o f

certificates for exported goods;

Giving technical advice in connection with

technical problems to private industries;

Printing services to government departments

and parastatal entities;

Sale of other publications;

Quarantine services;

Sale of milk powder, eggs and dairy produce;

Sale of vegetables;

Sale of livestock;

Sale of decorative trees, fruit trees, vine

rootings, fruit plants, shrubs and flowers;

Sale of wheat, straw and manure;

Sale of fish and fishing equipment;

Bowser water services;

Services of grafting, pruning and spraying;

Rent and provision of cold storage facilities

and sale of ice;

Services of civil abattoir;

Provision of telephonic communications;

Acting as contractor for cleaning services;

Sale of compost;

Repairs to damage;

Carpentry works;

Hiring of plant and vehicles;

Supply of metal trades goods;

Repairs to plant and vehicles;

Sale of prints;

Sale of food prepared by students as part of

their daily training.

(1)

In this Act, unless the context otherwise requires -

"accession date" means the 1st May 2004;

"accommodation", when provided on a bed and breakfast, half

board or full board basis, includes the provision of any services

normally falling within the meaning of accommodation on such a

basis and included in the price therefor;

"acquisitions threshold" means the threshold determined in

accordance with Part Three of the Third Schedule;

"administrative penalty" means a penalty imposed in virtue of

the provisions of Part V;

"assessment" means an assessment that may be made in virtue of

the provisions of Part V but does not include a provisional

assessment;

"Commissioner" means the Commissioner for Tax and Customs

appointed in terms of the provisions of article 3(1) or any public

officer or other person to whom a delegation has been made in

accordance with sub-article (2) or (3) of that article while he is

acting within the terms of that delegation;

"Community" means the territories of the Member States as

defined in the Fifteenth Schedule;

"customs duty suspension regime" has the meaning assigned to it

in the Fourth Schedule;

"Council Directive 2006/112/EC" means Council Directive 2006/

112/EC of 28 November 2006 on the common system of value

added tax, as may be amended from time to time;

"Coun cil Regul atio n (EU ) N o. 904 /20 10" m eans Co unci l

Regulation (EU) No. 904/2010 of 7 October 2010 on administrative

cooperation and combating fraud in the field of value added tax

(recast), as may be amended from time to time;

"distance sale" has the meaning assigned to it in the Third

Schedule;

"economic activity" has the meaning assigned to it in article 5;

"established" shall be construed in accordance with the

provisions of sub-articles (2) and (3) of this article;

"excise goods" means the goods defined in the S ixteenth

Schedule;

"exclusive economic zone area" shall have the same meaning as

assigned to it in the Exclusive Economic Zone Act;

"exempt supply", "exempt acquisition" or "exempt importation"

means a supply, an intra-community acquisition or an importation

which is exempt in terms of article 9;

"exempt with credit supply" is a supply to which Part One of the

Fifth Schedule applies;

"exempt without credit supply" is a supply to which Part Two of

the Fifth Schedule applies;

"goods" means any asset the supply of which is treated as a

supply of goods in terms of the Second Schedule;

"goods forming part of an economic activity" means goods,

including fixed assets, used by a taxable person for the purpose of

his economic activity;

"importation" has the meaning assigned to it in the Second

Schedule, and "imported" shall be construed accordingly;

"importer" with respect to imported goods means the person in

whose name the goods are at the time when tax on the importation

becomes chargeable in accordance with the Fourth Schedule;

"input tax" has the meaning assigned to it in article 22(2) and

"input tax credit" has the meaning assigned to it in article 22(3);

"intra-community acquisition" has the meaning assigned to it in

the Second Schedule;

"intra-community supply" means a supply of goods that are

transported by or on behalf of the supplier or the person to whom

the supply is made from a Member State to another Member State;

"Malta" means the Island of Malta, the Island of Gozo and the other

islands of the Maltese Archipelago, including the territorial waters

thereof, the continental shelf and subject to the provisions of sub-

article (4), also includes any exclusive economic zone area;

"Member State" has the meaning assigned to it in the Fifteenth

Schedule;

"Minister" means the Minister responsible for finance;

"new means of transport" means a means of transport to which

paragraph (a) hereof applies and which meets the conditions of

paragraph (b) hereof -

(a) this paragraph applies to a vessel exceeding 7.5 metres

in length, an aircraft the takeoff weight of which

exceeds 1,550 kilograms or a motorised land vehicle

the capacity of which exceeds 48 cubic centimetres or

the power of which exceeds 7.2 kilowatts, intended for

the transport of passengers or goods except for

(i)

a sea-going vessel which is used for navigation

on the high seas and carrying passengers for

reward, or for the purpose of commercial,

industrial or fishing activities, or for rescue or

assistance at sea, or for inshore fishing but does

not include ships’ provisions; and

(ii) aircraft used by airlines operating for reward

chiefly on international routes;

(b) the conditions that must be met for the purpose of this

definition are

(i)

in the case of a land vehicle, that it was supplied

not more than six months after the date of first

entry into service or has not travelled more than

6,000 kilometres;

(ii) in the case of sea vessels, that it was supplied

not more than three months after the date of first

entry into service or has not sailed for more than

100 hours;

(iii) in the case of an aircraft, that it was supplied not

more than three months after the date of first

entry into service or has not flown for more than

40 hours;

"non-taxable legal person" means a person, other than a physical

person, who is not a taxable person;

"non-taxable person" means a person who is not a taxable

person;

''notice of payment'' means the notice required to be furnished in

terms of article 30(3);

"output tax" has the meaning assigned to it in article 22(1);

"person" includes a physical person, a body of persons, a public

authority and any entity capable of carrying on an economic

activity;

"provisional assessment" means a provisional assessment made

in terms of article 32;

"public authority" means the Government of Malta, a department

or division of the Government of Malta, a local council set up in

accordance with the Local Government Act, an authority vested

with distinct personality set up by an Act of Parliament ,

corporation constituted by an Act of Parliament or any other body

governed by public law;

" "revenue acts" shall have the same meaning as assigned to it in the

Commissioner for Tax and Customs Act;

"self-supply" means the use or application of goods forming part

of the economic activity of a person that does not consist of the

delivery of goods to or the performance of services for another

person but which is treated as a supply of goods or a supply of

services in terms of the Second Schedule;

"supply" means an operation which is treated as a supply of

goods or a supply of services in terms of the Second Schedule;

"tax" means the value added tax chargeable under this Act but

does not include an administrative penalty or interest;

"tax invoice" means an invoice or a document serving as invoice

that contains the information required by the Twelfth Schedule;

"tax period" means a period determined in accordance with

article 17;

"tax return" means the return required to be furnished in terms of

article 27;

"taxable acquisition" means an intra-community acquisition on

which tax is chargeable in terms of article 4 and which is not

exempt from tax in terms of article 9;

"taxable importation" means an importation on which tax is

chargeable in terms of article 4 and which is not exempt from tax in

terms of article 9;

"taxable person" has the meaning assigned to it in article 5;

"taxable supply" means a supply on which tax is chargeable in

terms of article 4 and which is not exempt from tax in terms of

article 9;

"taxable value" m eans the value of a supply, of an intra-

c o m m u ni t y ac q ui s i t i o n o r o f a n i m p or t a ti o n d e t e r m i n e d i n

accordance with the Seventh Schedule;

"third territory" means any territory which is not a Member

State;

"transport" and "transported" include dispatch and dispatched;

" Tr i b u n a l " m e a n s t h e A d m i n i s t r a t i v e R e v i e w Tr i b u n a l

established by article 5 of the Administrative Justice Act;

"VAT" or "value added tax" shall mean any value added tax as

referred to in Council Directive 2006/112/EC;

"value added tax identification number" means an individual

number assigned by the competent authority of a Member State that

has a prefix in accordance with ISO International Standard 3166 -

alpha 2, and "a person identified for value added tax purposes in a

Member State" means a person to whom such an individual number

h a s b e e n a s s i g n e d a n d w h o , f o r t h e p u r p o s e o f a s u p p l y,

communicates that number to the supplier.

(2) The provisions of this sub-article and of sub-article (3)

shall apply for the purpose of determining the place where a person

is established

(a) a taxable person is established in a country if he has

established his economic activity or has a fixed place

of establishment from which he carries on that

economic activity in that country or, being a physical

person who has not fixed his economic activity or who

does not have a fixed place of establishment in any

country, has a permanent address or usually resides in

that country;

(b) a non-taxable legal person is established in a country if

it is constituted under the law of that country or if it

has a fixed place in that country from which it carries

on its activities;

(c) a non-taxable physical person is established in the

country where he has a permanent address or usually

resides.

(3) Where, in terms of sub-article (2), a taxable person falls to

be treated as established in Malta and in another country with

respect to the same transaction, and where it is necessary for the

proper application of any provision of this Act that he should be

treated as established only in one of those two countries, he shall,

to the extent that it is so necessary, be treated as established only in

the country with which that transaction is more closely connected.

(4) For the purpose of sub-article (1), an exclusive economic zone

area shall be deemed to form part of Malta only to the extent of

activities undertaken pursuant to, or which are directly related to, an

authorization or licence granted in accordance with the Exclusive

Economic Zone Act.

Substituted by

X. 2003.47.

[Article 6]

Amended by

L.N. 426 of 2007;

Supplies, Intra-Community Acquisitions and

L.N. 443 of 2007;

Importations

L.N. 105 of 2008;

L.N. 34 of 2009;

L.N. 532 of 2010;

L.N. 61 of 2011;

L.N. 418 of 2012;

L.N. 251 of 2019;

L.N. 219 of 2020;

L.N. 140 of 2022;

III.2026.66.

Supplies: general rule

1. Except as otherwise provided in this Schedule -

(a) a supply of goods is the transfer of the right to dispose of tangible

property as owner;

(b) a supply of services means a supply that is not a supply of goods.

Energy

2. The supply of electricity, gas, heat or cooling energy and other sources of

energy shall be treated as a supply of goods.

Rights over property

3. (1) The transfer of an asset which is immovable property by definition of

the law shall be treated as a supply of goods: provided that an emphyteutical grant

for a period not exceeding fifty years shall be treated as a supply of a service.

(2) Subject to the other provisions of paragraph (1) of this item an assignment

of any rights over property or of any intangible property whether or not it is the

subject of a document establishing title is a supply of services.

Delivery on deferred terms

4. The delivery of the possession of goods pursuant to an agreement for the

sale of those goods on deferred terms shall be treated as a supply of those goods.

Hire purchase

5. The delivery of the possession of goods pursuant to an agreement for the

hire of those goods for a certain period where the agreement expressly contemplates

that the ownership of those goods will be transferred at a time not later than the date

on which an agreed price has been paid in full shall be treated as a supply of those

goods.

Transfer of goods under a contract for commission

6. The transfer of goods pursuant to a contract under which commission is

payable on purchase or sale is a supply of those goods.

Contract of works

7. The delivery of goods pursuant to a contract of works, including a

construction contract, whether or not the materials have been provided in full or in

part by the customer, shall be treated as a supply of services, except in special

circumstances as the Minister may, otherwise, by regulations prescribe.

Obligation to refrain from an act or to tolerate an act

8. An obligation to refrain from an act or to tolerate an act or situation is a

supply of services.

Incidental supplies

9. (1) The provision by a person of goods for the purpose and in the course of

maintenance or repair services supplied by that person shall be treated as part of the

supply of those services.

(2) Save as otherwise provided in the Act or any regulations made under the

Act, where a supply includes the provision of both goods and services and the

consideration for that supply does not distinguish between the consideration for the

goods and the consideration for the services, the supply shall be treated as a supply

of goods or as a supply of services according to the principal nature of that supply.

Exchange

10. In a contract of exchange each of the parties shall be deemed to make a

supply of any goods and any services he transfers or provides pursuant to that

contract.

Supplies by disclosed agents

11. When a supply is made through an intermediary who acts in the name and

for the account of another person that supply shall be treated as a supply made by

that other person.

Supplies by undisclosed agents

12. When goods or services are supplied through an agent who acts in his own

name they shall be deemed to be supplied to that agent and supplied by that agent.

Facilitation of supplies of goods through an electronic interface

12A. (1) Where a taxable person facilitates, through the use of an electronic

interface such as a marketplace, platform, portal or similar means, distance sales of

goods imported from third territories or third countries in consignments of an

intrinsic value not exceeding one-hundred and fifty euro (€150), that taxable person

shall be deemed to have received and supplied those goods himself.(2) Where a

taxable person facilitates, through the use of an electronic interface such as a

marketplace, platform, portal or similar means, the supply of goods within the

Community by a taxable person not established within the Community to a non-

taxable person, the taxable person who facilitates the supply shall be deemed to have

received and supplied those goods himself.

Supply for consideration of goods forming part of an economic activity

13. The transfer or disposal by a taxable person of goods forming part of his

economic activity for consideration including

(a) the sale by judicial auction pursuant to any proceedings exercised by a

creditor or by creditors of that person;

(b) the transfer of such goods by order made by or in the name of a public

authority or in pursuance of the law against payment of compensation

shall be treated as a supply of goods by that taxable person acting as

such.

Application of goods forming part of an economic activity

14. (1) Subject to paragraph (3), the application by a person registered under

article 10 of goods forming part of his economic activity for his private use, or that

of his staff, or the disposal thereof free of charge or, more generally, their application

for purposes other than those of his economic activity, where the value added tax on

the said goods or the component parts thereof was wholly or partly deducted shall be

treated as a supply of goods for consideration by that taxable person acting as such.

(2) Paragraph (1) also applies with respect to the goods forming part of the

economic activity of a person at the time when his registration under article 10 is, for

any reason, cancelled

Provided that the Commissioner may exempt that person from accounting

for the supply when he has reason to believe that the taxable value is less than two

hundred and fifty euro (€250).

(3)

This item does not apply to -

(a) a gift of goods made in the course or furtherance of that activity,

otherwise than as one forming part of a series of gifts made to the same

person, where the cost to the donor is not more than fifty euro (€50);

(b) a gift of an industrial sample in a form not ordinarily available for sale

to the public.

Private use of goods forming part of an economic activity and services supplied free of

charge.

15. (1)

The use of goods forming part of an economic activity for the private

use of a taxable person or of his staff or, more generally, for purposes other than those of

his economic activity, where the VAT on such goods or the component parts thereof was

wholly or partly deductible, shall be treated as a supply of services for consideration

made by that taxable person acting as such

Provided that this sub-item shall not apply where such supply of services would

be subject to an exemption in accordance with Part One of the Fifth Schedule.

(2)

The supply of services carried out free of charge, other than a service which

would be subject to an exemption in accordance with Part One of the Fifth Schedule, by a

taxable person for his private use or for that of his staff, or more generally, for purposes

other than those of his economic activity, where any goods or services on which VAT was

wholly or partly deducted are used or applied to provide such free of charge services, shall

be treated as a supply of services for consideration made by that taxable person acting as

such

Provided that this shall not apply to services carried out free of charge made to

non-profit making organisations as defined in item 5 of Part Five of the Fifth Schedule.

Transfer of a going concern

16. (1) Notwithstanding the other provisions of this Schedule, the transfer by a

person of assets of his economic activity shall be treated as neither a supply of goods

nor a supply of services if

(a) the assets are transferred to a person registered under article 10 to whom

he transfers his economic activity, or part of that economic activity

which is capable of separate operation, as a going concern; and

(b) the said assets are to be used by the transferee in carrying on the same

kind of activity, whether or not as part of an existing economic activity,

as that carried on by the transferor; and

(c) the said transfer is recorded in the records of the transferor indicating

the registration number of the transferee.

(2) Subject to approval by the Commissioner, the provisions of paragraph (1)

shall also apply where the transferee is not registered under article 10, provided that

the transferor did not qualify for a credit of the input tax attributable to the

acquisition and the accumulation of the assets being transferred.

Transfer of goods to another Member State

17. (1) The transfer by a taxable person of goods forming part of his economic

activity to another Member State shall be treated as an intra-community supply of

those goods for consideration.

(2) Goods shall be deemed to be transferred by a taxable person to another

Member state if they are transported by or on his behalf from Malta to another

Member State ("the second State") for the purposes of his economic activity other

than for the purposes of any one of the following transactions

(a) the installation or assembly of those goods, with or without a trial run,

by or on behalf of the taxable person within the second State;

(b) the supply of those goods under a transaction that constitutes a distance

sale that takes place in the second State;

(c) the supply of those goods by or on behalf of the taxable person on board

ships, aircraft or trains during the transport of passengers where the

point of departure of that transport is in the second State;

(d) the supply of those goods by the taxable person in the second State

under a transaction which would be treated as an exempt with credit

supply in terms of the provisions of items 1 to 9 of Part One of the Fifth

Schedule if made in Malta;

(e) the supply of services to the taxable person involving valuations of, or

work on, those goods physically carried out in the second State provided

the said goods are returned to that person in Malta on the completion of

the said work;

(f)

the temporary use of those goods in the second State for the purpose of

the supply of services by the taxable person if that person is established

in Malta;

(g) the temporary use of those goods in the second State for a period not

exceeding twenty-four months if the importation of those goods into

that State for temporary use would qualify for a full exemption from

import duties;

(h) the supply of gas through a natural gas system situated within the territory

of the Community or any network connected to such a system, the supply of

electricity or the supply of heat or cooling energy through heating or

cooling networks, in accordance with the conditions laid down in item 5 of

Part One of the Third Schedule

(3) Where a transport of goods satisfies the conditions of any subparagraph of

paragraph (2) and, at a subsequent stage, those conditions are no longer met, the

transport shall, at that subsequent stage, be treated as a transfer to which paragraph

(1) applies.

(4) The Minister may by regulations prescribe simplification measures for the

application of this item and of item 18, in accordance with Article 395 of Council

Directive 2006/112/EC or in virtue of any other article in substitution therefor.

Call-off stock arrangements

17A. (1) The transfer by a taxable person of goods forming part of his business

assets to another Member State under call-off stock arrangements shall not be treated

as a supply of goods for consideration.

(2) For the purposes of this item, call-off stock arrangements shall be deemed to

exist where the following conditions are met

(a) goods are dispatched or transported by a taxable person, or by a third

party on his behalf, to another Member State with a view to those goods

being supplied there, at a later stage and after arrival, to another taxable

person who is entitled to take ownership of those goods in accordance

with an existing agreement between both taxable persons;

(b) the taxable person dispatching or transporting the goods has not

established his business nor has a fixed establishment in the Member

State to which the goods are dispatched or transported;

(c) the taxable person to whom the goods are intended to be supplied is

identified for VAT purposes in the Member State to which the goods are

dispatched or transported and both his identity and the VAT

identification number assigned to him by that Member State are known

to the taxable person referred to in paragraph (b) at the time when the

dispatch or transport of goods begins;

(d) the taxable person dispatching or transporting the goods records the

transfer of the goods in the register provided for in paragraph (1)(k) of

item 1 of the Eleventh Schedule and includes the identity of the taxable

person acquiring the goods and the VAT identification number assigned

to him by the Member State to which the goods are dispatched or

transported in the recapitulative statement provided for in article 30(2).

(3) Where the conditions laid down in sub-item (2) are met, the following rules

shall apply at the time of the transfer of the right to dispose of the goods as owner to

the taxable person referred to in paragraph (c) of sub-item (2), provided that the

transfer occurs within the deadline referred to in sub-item (4)

(a) a supply of goods in accordance with item 3(1) of Part One of the Fifth

Schedule shall be deemed to be made by the taxable person that

dispatched or transported the goods either by himself or by a third party

on his behalf in the Member State from which the goods were

dispatched or transported;

(b) an intra-Community acquisition of goods shall be deemed to be made by

the taxable person to whom those goods are supplied in the Member

State to which the goods were dispatched or transported.

(4) If, within twelve (12) months after the arrival of the goods in the Member

State to which they where dispatched or transported, the goods have not been

supplied to the taxable person for whom they were intended, referred to in paragraph

(c) of sub-item (2) and sub-item (6), and none of the circumstances laid down in sub-

item (7) have occurred, a transfer within the meaning of item 17 shall be deemed to

take place on the day following the expiry of the twelve (12) month period.

(5)

No transfer within the meaning of item 17 shall be deemed to take place

where the following conditions are met

(a)

the right to dispose of the goods has not been transferred, and those

goods are returned to the Member State from which they were dispatched or

transported within the time limit referred to in sub-item (4); and

(b)

the taxable person who dispatched or transported the goods records

their return in the register provided for in paragraph (1)(k) of item 1 of the

Eleventh Schedule.

(6) Where, within the period referred to in sub-item (4), the taxable person

referred to in paragraph (c) of sub-item (2) is substituted by another taxable person,

no transfer within the meaning of item 17 shall be deemed to take place at the time of

the substitution, provided that

(a) all other applicable conditions in sub-item (2) are met; and

(b) the substitution is recorded by the taxable person referred to in

paragraph (b) of sub-item (2) in the register provided for in paragraph

(1)(k) of item 1 of the Eleventh Schedule.

(7) Where, within the time limit referred to in sub-item (4), any of the conditions

set out in sub-items (2) and (6) ceases to be fulfilled, a transfer of goods according to

item 17 shall be deemed to take place at the time that the relevant condition is no

longer fulfilled.

If the goods are supplied to a person other than the taxable person referred to in

paragraph (c) of sub-item (2) or in sub-item (6), it shall be deemed that the

conditions set out in sub-items (2) and (6) cease to be fulfilled immediately before

such supply.

If the goods are dispatched or transported to a country other than the Member

State from which they were initially moved, it shall be deemed that the conditions

set out in sub-items (2) and (6) cease to be fulfilled immediately before such

dispatch or transport of goods starts.

In the event of the destruction, loss or theft of the goods, it shall be deemed that the

conditions set out in sub-items (2) and (6) cease to be fulfilled on the date that the goods

were actually removed or destroyed, or, if it is impossible to determine that date, the date

on which the goods were found to be destroyed or missing.

Intra-community acquisitions

18. (1) An intra-community acquisition is

(a) the acquisition of the right to dispose as owner of goods which are

transported by or on behalf of the supplier or the person acquiring them

from a Member State to the person acquiring them in another Member

State; or

(b) the use in a Member State by a taxable person for the purpose of his

economic activity of goods transported by him or on his behalf from

another Member State within the territory of which those goods were

produced, extracted, purchased, acquired or imported by him for the

purpose of his economic activity, where the transport of those goods

would, if made from Malta to another Member State, be treated as a

transfer of goods to another Member State in accordance with item 17;

(c) the acquisition by a non-taxable legal person of goods imported by that

person into the Community and transported to a Member State other

than the State of importation.

(d) The application by the armed forces of a Member State taking part in a

defence effort carried out for the implementation of a European Union

activity under the common security and defence policy, for their use or for

the use of the civilian staff accompanying them, of goods which they have

not purchased subject to the general rules governing taxation on the

domestic market of an EU Member State shall be treated as an intra-

Community acquisition of goods for consideration, where the importation

of those goods would not be eligible for the exemption provided for in

paragraph (b) of item 9 of Part Four of the Fifth Schedule.

(2) Any transaction which is treated under this Act as a supply of goods or a

supply of goods for consideration shall also be treated as involving an acquisition of

the right to dispose as owner of those goods or an acquisition of those goods for

consideration.

Importation

19. Importation means

(a) the entry into Malta before the accession date of goods transported from

any other country;

(b) the entry into the Community on or after the accession date of goods

transported from a third territory excluding, however

(i)

goods which fulfil the conditions laid down in Articles 9 and 10

of the Treaty establishing the European Economic Community;

and

(ii) goods covered by the Treaty establishing the European Coal and

Steel Community that are in free circulation.

(1) The administration of the Act is vested in the

Commissioner for Tax and Customs, hereinafter in this Act referred

to as "the Commissioner", who shall be a public officer appointed

as such by the Prime Minister.

(2) The Commissioner may delegate to any public officer any

of the rights, duties, powers and other functions vested in him,

conferred to him or imposed upon him by this Act.

(3) The Commissioner may delegate to any other person such

of the rights, duties, powers and other functions vested in him,

conferred to him or imposed upon him by this Act as the Minister

may direct in writing

Provided that the Commissioner may not delegate those

rights, duties, powers and other functions vested in him if that

person is not considered by the Commissioner as a fit and proper

person to exercise those rights, duties, powers and other functions

and that such person shall be subject to the obligations imposed by

article 56.

PART II

Scope of the Tax

Substituted by

X. 2003.47.

[Article 7]

Amended by

L.N. 124 of 2007;

Place of Supplies, Intra-Community Acquisitions L.N. 444 of 2007.

and Importations

Substituted by

L.N. 133 of 2009.

Part One

Amended by

L.N. 533 of 2010;

Place of supply of goods

L.N. 297 of 2018;

L.N. 250 of 2019;

L.N. 220 of 2020;

L.N. 344 of 2024;

IX.2025.73.

Supply of goods: general rule

1. Except as otherwise provided in this Schedule -

(a) a supply of goods that are not transported takes place where the goods

are at the time when they are placed at the disposal of the person

acquiring those goods;

(b) a supply of goods that are transported takes place where the goods are at

the time when the transport of those goods begins

Provided that

(i) where the same goods are supplied successively and those goods are

dispatched or transported from one (1) Member State to another

Member State directly from the first supplier to the last customer

in the chain, the dispatch or transport shall be ascribed only to the

supply made to the intermediary operator;

(ii) by way of derogation from sub-paragraph (i), the dispatch or

transport shall be ascribed only to the supply of goods by the

intermediary operator when the intermediary operator has

communicated to his supplier the VAT identification number

issued to him by the Member State from which the goods are

dispatched or transported; and

(iii) for the purpose of this proviso, "intermediary operator" means a

supplier within the chain other than the first supplier in the chain

who dispatches or transports the goods either himself or through a

third party acting on his behalf

Provided further that where a taxable person is deemed to

have received and supplied goods in accordance with item 12A of

the Second Schedule, the dispatch or transport of the goods shall

be ascribed to the supply made by that taxable person;

(c) when the transport of goods begins outside the Community and ends in

a Member State the supply of those goods by the importer and any

subsequent supply up to the acquisition of those goods takes place in the

Member State where they are imported.

Goods installed or assembled

2. A supply of goods that are installed or assembled, with or without a trial run,

by or on behalf of the supplier takes place where the goods are installed or

Goods supplied on board ships, aircraft or trains

3. A supply of goods on board ships, aircraft or trains during the part of a

transport of passengers effected in the Community takes place at the point of

departure of the transport of passengers and, for the purpose of this item -

(a) "part of the transport of passengers effected in the Community" means

the part of the transport effected, without a stop in a third territory,

between the point of departure and the point of arrival of the transport

of passengers;

(b) "the point of departure of the transport of passengers" means the first

point of passenger embarkation foreseen within the Community, where

relevant after a leg outside the Community;

(c) "the point of arrival of the transport of passengers" means the last point

of disembarkation of passengers foreseen within the Community of

passengers who embarked in the Community, where relevant before a

leg outside the Community;

(d) a return trip shall be treated as a separate trip.

Distance sales

4. (1) Intra-Community distance sales of goods "means supplies of goods

dispatched or transported by or on behalf of the supplier, including where the

supplier intervenes indirectly in the transport or dispatch of the goods, from a

Member State other than that in which dispatch or transport of the goods to the

customer ends, where the following conditions are met

(a) the supply of goods is carried out for a taxable person, or a non-taxable

legal person, whose intra-Community acquisitions of goods are not

subject to VAT pursuant to Article 3(1) of Council Directive 2006/112/

EC, or for any other non-taxable person;

(b) the goods supplied are neither new means of transport nor goods

supplied after assembly or installation, with or without a trial run, by or

on behalf of the supplier.

(2) "Distance sales of goods imported from third territories or third countries"

means supplies of goods dispatched or transported by or on behalf of the supplier,

including where the supplier intervenes indirectly in the transport or dispatch of the

goods, from a third territory or third country, to a customer in a Member State, where

the following conditions are met

(a) the supply of goods is carried out for a taxable person, or a non-taxable

legal person, whose intra-Community acquisitions of goods are not

subject to VAT pursuant to Article 3(1) of Council Directive 2006/112/

EC, or for any other non-taxable person;

(b) the goods supplied are neither new means of transport nor goods supplied

after assembly or installation, with or without a trial run, by or on behalf

of the supplier.

(3) (a) The place of supply of intra-Community distance sales of goods shall be

deemed to be the place where the goods are located at the time when dispatch or

transport of the goods to the customer ends.

(b) The place of supply of distance sales of goods imported from third

territories or third countries into a Member State other than that in which dispatch or

transport of the goods to the customer ends, shall be deemed to be the place where

the goods are located at the time when dispatch or transport of the goods to the

customer ends.

(c) The place of supply of distance sales of goods imported from third

territories or third countries into the Member State in which dispatch or transport of

the goods to the customer ends shall be deemed to be in that Member State, provided

that VAT on those goods shall be declared under the special scheme in item 4 of Part

Seven of the Fourteenth Schedule or the corresponding legislation of any another

Member State.

(4) Sub-item (3) shall not apply to supplies of second-hand goods, works of art,

collectors’ items or antiques, as defined in item 1 of Part Two of the Fourteenth

Schedule, nor to supplies of second-hand means of transport which do not qualify as

new means of transport, subject to VAT in accordance with the relevant special

arrangements.

(5) Paragraph (a) of sub-item (3) shall not apply where the following conditions

(a) (i) the supplier is established or, in the absence of an establishment, has

his permanent address or usually resides only in one (1) Member State;

and

(ii) the goods are dispatched or transported to any Member State other

than the Member State referred to in sub-paragraph (i); and

(iii) the total value, exclusive of VAT, of the supplies referred to in sub-

paragraph (ii), together with the total value of the supplies of services

referred to in paragraph (b) of sub-item (2) of item 10of Part Two of this

Schedule does not in the current calendar year exceed ten-thousand euro

(€10,000) nor did it do so in the course of the preceding calendar year.

(b) Where, during a calendar year, the threshold referred to in sub-

paragraph (iii) of paragraph (a) is exceeded, paragraph (a) of sub-item

(3) shall apply as of that time.

(c) The Commissioner shall grant to those taxable persons providing

supplies eligible under paragraph (a) the right to opt for the place of

supply to be determined in accordance with paragraph (a) of sub-item

(3), which shall in any event cover two (2) calendar years

Provided that, a valid election for this purpose shall be made by

means of a notice in writing to the Commissioner on a form acceptable

to the Commissioner specifying the date from which it shall apply, not

being earlier than thirty (30) days from the date on which it is furnished.

Supplies of gas through a natural gas system, of electricity and of heat or cooling

energy through heating and cooling networks

5. (1) The place of supply to a taxable dealer of the supply of gas through a

natural gas system situated within the territory of the Community or any network

connected to such a system, the supply of electricity or the supply of heat or cooling

energy through heating or cooling networks shall be deemed to be the place where

that taxable dealer has established his business or has a fixed establishment for

which the goods are supplied or, in the absence of such a place of business or fixed

establishment, the place where he has his permanent address or usually resides.

For the purposes of this paragraph, "taxable dealer" shall mean a taxable

person whose principal activity in respect of purchases of gas, electricity, heat or

cooling energy is reselling those products and whose own consumption of those

products is negligible.

(2) Where a supply of gas through a natural gas system situated within the

territory of the Community or any network connected to such a system, the supply of

electricity or the supply of heat or cooling energy through heating or cooling

networks is not covered by paragraph (1), the place of supply shall be deemed to be

the place where the customer effectively uses and consumes the goods

Provided that where all or part of the gas, electricity or heat or cooling

energy is not effectively consumed by the customer, those non-consumed goods shall

be deemed to have been used and consumed at the place where the customer has

established his business or has a fixed establishment for which the goods are

supplied. In the absence of such a place of business or fixed establishment, the

customer shall be deemed to have used and consumed the goods at the place where

he has his permanent address or usually resides.

Part Two

Place of supply of services

Definitions

1. For the purpose of applying the rules concerning this Part

(a) a taxable person who also carries out activities or transactions that are

not considered to be taxable supplies of goods or services in accordance

with article 4 shall be regarded as a taxable person in respect of all

services rendered to him;

(b) a non-taxable legal person who is identified for VAT purposes shall be

regarded as a taxable person.

General rules

2. Except as otherwise provided in this Schedule

(a) The place of supply of services to a taxable person acting as such shall

be the place where that person has established his business. However, if

those services are provided to a fixed establishment of the taxable

person located in a place other than the place where he has established

his business, the place of supply of those services shall be the place

where that fixed establishment is located. In the absence of such place

of establishment or fixed establishment, the place of supply of services

shall be the place where the taxable person who receives such services

has his permanent address or usually resides.

(b) The place of supply of services to a non-taxable person shall be the place

where the supplier has established his business. However, if those services

are provided from a fixed establishment of the supplier located in a place

other than the place where he has established his business, the place of

supply of those services shall be the place where that fixed establishment is

located. In the absence of such place of establishment or fixed

establishment, the place of supply of services shall be the place where the

supplier has his permanent address or usually resides.

Supply of services by intermediaries

3. The place of supply of services rendered to a non-taxable person by an

intermediary acting in the name and on behalf of another person shall be the place

where the underlying transaction is supplied in accordance with this Act.

Supply of services connected with immovable property

4. The place of supply of services connected with immovable property,

including the services of experts and estate agents, the provision of accommodation

in the hotel sector or in sectors with a similar function, such as holiday camps or

sites developed for use as camping sites, the granting of rights to use immovable

property and services for the preparation and coordination of construction work,

such as the services of architects and of firms providing on-site supervision, shall be

the place where the immovable property is located.

Supply of transport

5. (1) The place of supply of passenger transport shall be the place where the

transport takes place, proportionate to the distances covered.

(2) The place of supply of the transport of goods, other than the intra-

Community transport of goods, to non-taxable persons shall be the place where the

transport takes place, proportionate to the distances covered.

(3) The place of supply of the intra-Community transport of goods to non-

taxable persons shall be the place of departure.

For the purpose of this paragraph

(a) "Intra-Community transport of goods" shall mean any transport of

goods in respect of which the place of departure and the place of arrival

are situated within the territories of two different Member States.

(b) "Place of departure" shall mean the place where transport of the goods

actually begins, irrespective of distances covered in order to reach the

place where the goods are located and "place of arrival" shall mean the

place where transport of the goods actually ends.

Supply of cultural, artistic, sporting, scientific, educational, entertainment and

similar services, ancillary transport services and valuations of and work on movable

property

6. (1) The place of supply of services in respect of admission to cultural,

artistic, sporting, scientific, educational, entertainment or similar events, such as

fairs and exhibitions, and of ancillary services related to the admission, supplied to a

taxable person, shall be the place where those events actually take place

Provided that the provisions of this sub-item shall not apply to admission to

the events referred to in this sub-item where the attendance is virtual.

(2)(a) The place of supply of services and ancillary services, relating to cultural,

artistic, sporting, scientific, educational, entertainment or similar activities, such as fairs

and exhibitions, including the supply of services of the organisers of such activities,

supplied to a non-taxable person shall be the place where those activities actually take

place

Provided that where the services and ancillary services relate to activities

which are streamed or otherwise made virtually available, the place of supply shall,

however, be the place where the non-taxable person is established, has his permanent

address or usually resides.

(b)

The place of supply of the following services to a non-taxable person shall

be the place where the services are physically carried out

(i)

ancillary transport activities such as loading, unloading, handling

and similar activities; and

(ii)

valuations of and work on movable tangible property.

Supply of restaurant and catering services

7. The place of supply of restaurant and catering services other than those

physically carried out on board ships, aircraft or trains during the section of a

passenger transport operation effected within the Community, shall be the place

where the services are physically carried out.

Hiring of means of transport

8. (1) The place of short-term hiring of a means of transport shall be the place

where the means of transport is actually put at the disposal of the customer.

(2) The place of hiring, other than short-term hiring, of a means of transport to a

non-taxable person shall be the place where the customer is established, has his

permanent address or usually resides.

However, the place of hiring a pleasure boat to a non-taxable person, other

than short-term hiring, shall be the place where the pleasure boat is actually put at

the disposal of the customer, where this service is actually provided by the supplier

from his place of business or a fixed establishment situated in that place.

(3) For the purposes of paragraphs (1) and (2), "short-term" shall mean the

continuous possession or use of the means of transport throughout a period of not

more than thirty days and, in the case of vessels, not more than ninety days.

Supply of restaurant and catering services for consumption on board ships,

aircraft or trains

9. (1) The place of supply of restaurant and catering services which are

physically carried out on board ships, aircraft or trains during the section of a

passenger transport operation effected within the Community, shall be at the point of

departure of the passenger transport operation.

(2) For the purposes of paragraph (1), "section of a passenger transport

operation effected within the Community" shall mean the section of the operation

effected, without a stopover outside the Community, between the point of departure

and the point of arrival of the passenger transport operation.

"Point of departure of a passenger transport operation" shall mean the first

scheduled point of passenger embarkation within the Community, where applicable

after a stopover outside the Community.

"Point of arrival of a passenger transport operation" shall mean the last scheduled

point of disembarkation within the Community of passengers who embarked in the

Community, where applicable before a stopover outside the Community.

In the case of a return trip, the return leg shall be regarded as a separate transport

Supply of telecommunications, broadcasting and electronic services to non-

taxable persons

10. (1)

The place of supply of the following services to a non-taxable person

shall be the place where that person is established, has his permanent address or

usually resides

(a) telecommunications services;

(b) radio and television broadcasting services;

(c) electronically supplied services, in particular services relating to

websites supply, web-hosting, distance maintenance of programmes and

equipment, supply of software and updating thereof, supply of images,

text and information, and making available of databases, supply of

music, films and games, including games of chance and gambling

games, and of political, cultural, artistic, sporting, scientific and

entertainment broadcasts and events, and supply of distance teaching.

Where the supplier of a service and the customer communicate via

electronic mail, that shall not of itself mean that the service supplied is

an electronically supplied service.

(2)

Sub-item (1) shall not apply where the following conditions are met

(a) the supplier is established or, in the absence of an establishment, has his

permanent address or usually resides only in one (1) Member State; and

(b) services are supplied to non-taxable persons who are established, or

have their permanent address or usually reside in any Member State

other than the Member State referred to in paragraph (a); and

(c) the total value, exclusive of VAT, of the supplies referred to in

paragraph (b), together with the total value of the supplies referred to

sub-paragraph (ii) of paragraph (a) of sub-item (5) of item 4 of Part One

of this Schedule does not in the current calendar year exceed ten-

thousand euro (€10,000) nor did it do so in the course of the preceding

calendar year.

(3) Where, during a calendar year, the threshold referred to in paragraph (c) of

sub-item (2) is exceeded, sub-item (1) shall apply as of that time.

(4) The Commissioner shall grant to those taxable persons providing supplies

eligible under sub-item (2) the right to opt for the place of supply to be determined in

accordance with sub-item (1), which shall in any event cover two (2) calendar years

Provided that, a valid election for this purpose shall be made by means of a

notice in writing to the Commissioner on a form acceptable to the Commissioner

specifying the date from which it shall apply, not being earlier than thirty (30) days

from the date on which it is furnished.

Supply of services to non-taxable persons outside the Community

11. The place of supply of the following services to a non-taxable person who is

established or has his permanent address or usually resides outside the Community,

shall be the place where that person is established, has his permanent address or

usually resides

(a) transfers and assignments of copyrights, patents, licences, trade marks

and similar rights;

(b) advertising services;

(c) the services of consultants, engineers, consultancy firms, lawyers,

accountants and other similar services, as well as data processing and

the provision of information;

(d) obligations to refrain from pursuing or exercising, in whole or in part, a

business activity or a right referred to in this item;

(e) banking, financial and insurance transactions including reinsurance,

with the exception of the hire of safes;

(f)

the supply of staff;

(g) the hiring out of movable tangible property, with the exception of all

means of transport;

(h) the provision of access to a natural gas system situated within the territory

of the Community or to any network connected to such a system, to the

electricity system or to heating or cooling networks, or the transmission or

distribution through these systems or networks, and the provision of other

services directly linked thereto.

Prevention of double taxation or non-taxation

12. In order to prevent double taxation, non-taxation or distortion of competition,

the Commissioner may, with regard to services the place of supply of which is governed

by item 2, the proviso to item 6(2)(a), item 8, item 10 and item 11 of this Part

(a) consider the place of supply of any or all of those services, if situated

within Malta, as being situated outside the Community if the effective

use and enjoyment of the services takes place outside the Community;

(b) consider the place of supply of any or all of those services, if situated

outside the Community, as being situated within Malta if the effective

use and enjoyment of the services takes place within Malta.

Part Three

Place of Intra-Community Acquisitions

Intra-community acquisitions: general rule

1. An intra-community acquisition takes place where the goods are when the

transport of the goods to the person acquiring them ends.

Place of intra-community acquisition under an identification number assigned

under this Act

2. (1) Without prejudice to item 1, when a taxable person makes an intra-

community acquisition on which he is identified as registered under article 10 the

acquisition shall be deemed to take place in Malta unless the person acquiring the

goods establishes that the acquisition has been treated as taking place in another

Member State and subject to value added tax in that State in terms of provisions in

force under the law of that State corresponding to item 1.

(2) For the purpose of paragraph (1) an intra-community acquisition of goods

shall be deemed to have been subject to value added tax in a Member State in terms

of provisions in force under the law of that State corresponding to item 1 if all the

following conditions are fulfilled

(a) it is made for the purpose of a subsequent supply of those goods in that

other Member State;

(b) the subsequent supply is made to a taxable person or a non-taxable legal

person identified for value added tax purposes in the Member State of

destination;

(c) the person to whom the subsequent supply is made is designated by the

supplier as the person liable for the payment of the tax on that supply;

(d) the taxable person registered under article 10 reports the subsequent supply

in the recapitulative statement required in accordance with article 30(2).

The Acquisitions Threshold

3. The Acquisitions Threshold is the equivalent of ten thousand euro (€10,000)

using the latest conversion rate before 1st January of the year in respect of which

that threshold is relevant, as published by the Central Bank of Malta if such year is

the year 2008 or prior, and by the European Central Bank if such year is the year

2009 or subsequent.

The value of intra-community acquisitions

4. For the purpose of determining whether the value of intra-community

acquisitions in any particular case exceeds the Acquisitions Threshold or otherwise,

the value of the intra-community acquisitions in question shall be taken to be the

taxable value that would be determined in accordance with the relevant provisions of

the Seventh Schedule if they were taxable intra-community acquisitions, provided

that no account shall be taken of the value of

(a)

intra-community acquisitions of new means of transport and of

excise goods; and

(b)

value added tax paid or due in a Member State other than Malta on

the intra-community supply of the goods in question.

Part Four

Place of Importations

Importations

1. An importation of goods takes place where the goods are at the time when

the chargeable event takes place.

Subject to the other provisions of this Act there shall be

charged, levied and collected on account of the Government a value

added tax -

(a) on every supply of goods or of services that takes place in

Malta made on or after 1 January 1999 for consideration

by a taxable person acting as such;

(b) on every intra-community acquisition made for

consideration on or after the accession date in Malta

where -

(i)

it is an acquisition of goods, other than new means

of transport and excise goods, made by a taxable

person acting as such, or a non-taxable legal

person, where the vendor is a taxable person acting

as such who is not eligible for the exemption for

small enterprises provided for in Article 284 of

Council Directive 2006/112/EC and where such

vendor is not covered by Articles 33 and 36 of the

said Directive;

(ii) it is an acquisition of new means of transport

made by any person; or

(iii) it is an acquisition of excise goods made by a

taxable person or a non-taxable legal person;

(c) on every importation that takes place in Malta on or

after 1 January 1999.

Amended by

L.N. 17 of 1999;

[Article 8]

L.N. 28 of 1999;

L.N. 89 of 1999;

Date when a chargeable event takes place and

L.N. 116 of 1999;

when tax becomes chargeable

L.N. 142 of 1999;

L.N. 199 of 1999;

L.N. 11 of 2000;

L.N. 274 of 2000;

L.N. 23 of 2001;

L.N. 171 of 2001;

L.N. 233 of 2001;

L.N. 180 of 2002;

L.N. 205 of 2002;

L.N. 39 of 2003.

Substituted by

X. 2003.47.

Amended by

L.N. 71 of 2010;

L.N. 419 of 2012;

L.N. 140 of 2013;

L.N. 221 of 2020;

III.2026.68.

Date of the chargeable event in the case of supplies of goods

1. (1) In the case of a supply of goods the chargeable event takes place on the

date when the goods are delivered.

(2) For the purpose of paragraph (1), when the delivery of goods, other than

goods referred to in paragraph (3), gives rise to successive statements of account or

payments the goods shall be treated as delivered, up to the value covered by those

statements, on the last day of each period to which such statements of account or

payments refer

Provided that, when a continuous supply of goods does not give rise to statements

of account or payments during a year, it shall be regarded as being delivered at least

at intervals of one year.

(3) Paragraph (2) does not apply to the delivery of goods pursuant to a contract

for the hire of goods for a certain period or for the sale of goods on deferred terms,

which provides that in the normal course of events ownership shall pass at the latest

upon payment of the final instalment.

(4) Notwithstanding the provisions of paragraphs (2) and (3), continuous

supplies of goods over a period of more than one calendar month which are

dispatched or transported to a Member State other than Malta and which are supplied

VAT exempt or which are transferred VAT exempt to another Member State by a

taxable person for the purposes of his business, in accordance with the conditions

laid down in item 3, Part One, Fifth Schedule, shall be regarded as being completed

on expiry of each calendar month until such time as the supply comes to an end.

Date of the chargeable event in the case of supplies of services

2. (1) In the case of a supply of services, the chargeable event takes place on

the date when the services are performed.

(2) For the purpose of paragraph (1), when the supply of services gives rise to

successive statements of account or payments they shall be treated as performed, up

to the value covered by those statements, on the last day of each period to which

such statements of account or payments refer

Provided that, when a continuous supply of services does not give rise to

statements of account or payments during a year, it shall be regarded as being

completed at least at intervals of one year.

(3) Notwithstanding the provisions of paragraph (2), when a supply of services

for which VAT is payable pursuant to article 20(2)(b) of the Act is supplied

continuously over a period of more than one year and it does not give rise to

statements of account or payments during that period it shall be regarded as being

completed on expiry of each calendar year until such time that the supply comes to

an end.

Date when tax on supplies becomes chargeable

3. The tax on a supply which takes place in Malta, other than a supply to which

item 4 applies, becomes chargeable on the earlier of the following two dates

(a) the date when the chargeable event takes place;

(b) the date when a payment is made for the supply to the extent covered by

that payment

Provided that where a tax invoice is issued by the fifteenth day of the month

following the date determined under the foregoing provisions of this subsection the

tax becomes chargeable on the date of the invoice.

Chargeable event and chargeability of VAT for the supply of goods facilitated

through an electronic interface

3A. By way of derogation from items 1, 2 and 3, the chargeable event of the supply

of goods by a taxable person who is deemed to have received and supplied the goods in

accordance with item 12A of the Second Schedule and of the supply of goods to that

taxable person shall occur and VAT shall become chargeable at the time when the

payment has been accepted.

Date when tax on exempt intra-Community supplies becomes chargeable.

4. The tax on an intra-Community supply which is exempt in accordance with

item 3 of Part One of the Fifth Schedule becomes chargeable on the earlier of the

following two (2) dates

(a) the date on which a tax invoice is issued for such supply; and

(b) the fifteenth (15) day of the month following the date when the

chargeable event takes place in accordance with sub-item (1) or (4) of

item 1, if no invoice has been issued by such date.

Date of the chargeable event in the case of intra-community acquisitions

5. In the case of an intra-community acquisition of goods the chargeable event

takes place on the date which would be the date of the chargeable event had those

goods been supplied in the Member State where the acquisition is made.

Date when tax on intra-community acquisitions becomes chargeable

6. The tax on an intra-community acquisition becomes chargeable on the

earlier of the following two dates -

(a) the fifteenth day of the month following the date of the acquisition;

(b) the date on which a tax invoice is issued to the person making the

acquisition for the supply of goods in question.

Date of the chargeable event and when tax becomes chargeable in the case of

importations

7. (1) When goods are, on importation, placed under a customs duty

suspension regime the chargeable event takes place and the tax becomes chargeable

on the date when they cease to remain subject to that regime.

(2) When goods are, on importation, subject to customs duties, to agricultural

levies or to charges having equivalent effect established under a common policy, the

chargeable event takes place and tax becomes chargeable when the chargeable event

for those Community duties takes place and those duties become chargeable.

(3) In the case of an importation of goods that is not subject to the Community

duties referred to in paragraph (2), the chargeable event takes place and tax becomes

chargeable when, if the importation were subject to those duties, the chargeable

event for those Community duties would take place and those duties would become

chargeable.

(4) "Customs duty suspension regime" means any of the following arrangements

and procedures to the extent that they provide, under the customs legislation of a

Member State, for the temporary exemption from duty chargeable on the entry of

goods into that State while the conditions required under those arrangements and

procedures are met

(a) the temporary storage of goods;

(b) the placing of goods in a free zone or free warehouse;

(c) customs warehousing or inward processing;

(d) the admittance into territorial waters of goods on drilling and

production platforms;

(e) the temporary entry of goods into that State;

(f)

external transit procedures;

(g) internal transit procedures.

.

(1) "Taxable person" means a person who carries on an

economic activity, whatever the purpose or result of that activity.

(2) Saving the provisions of sub-article (3) an economic

activity means an activity carried on by a person, other than an

employee acting as such, and consisting of any one or more of the

following -

(a) any trade or business;

(b) any profession or vocation and the provision of any

personal services;

(c) the exploitation of tangible or intangible property for

the purpose of obtaining income therefrom on a

continuing basis;

(d) the provision by a club, association or organisation

(for a subscription or other consideration) of the

facilities or advantages available to its members;

(e) the admission, for a consideration, of persons to any

premises.

(3) The activities of a public authority acting in the exercise of

the functions assigned to it by law shall not be deemed to be an

economic activity except as and to the extent provided in the First

Schedule and except where such treatment as non-taxable persons

would lead to significant distortions in competition.

(4) A person who does not carry on an economic activity within

the meaning of the foregoing provisions but who, from time to

time, makes an intra-community supply of new means of transport

shall, for the purpose of any such supply, be treated as a taxable

person.

(5) For the purpose of this article "employee" means an

individual bound to an employer by a contract of employment or by

other legal ties creating the relationship of employer and employee

as regards working conditions, remuneration and the employee’s

liability and includes the holder of an office.

(6) After consultation with the VAT Committee set up in

accordance with Article 398 of Council Directive 2006/112/EC, the

Minister may make regulations to regard as a single taxable person

any persons established in Malta who, while legally independent,

are closely bound to one another by financial, economic and

organisational links.

Amended by

L.N. 24 of 2001.

[Article 8]

Substituted by

X. 2003.47.

Exemptions

Amended by

Part One

L.N. 250 of 2004;

L.N. 520 of 2004;

Exemptions with credit

L.N. 334 of 2006;

L.N. 121 of 2007;

L.N. 445 of 2007;

L.N. 234 of 2009;

L.N. 286 of 2010;

L.N. 425 of 2010;

L.N. 534 of 2010;

L.N. 379 of 2011;

L.N. 499 of 2011;

L.N. 38 of 2012;

L.N. 345 of 2013;

L.N. 422 of 2013;

L.N. 480 of 2014;

L.N. 227 of 2015;

L.N. 247 of 2016;

L.N. 383 of 2016;

L.N.347 of 2017;

L.N. 9 of 2018;

L.N.155 of 2019;

L.N.302 of 2019;

L.N.253 of 2019;

L.N.222 of 2020;

L.N. 4 of 2021;

L.N. 358 of 2021;

VII.2022.70;

L.N. 138 of 2022;

L.N. 12 of 2024;

L.N. 228 of 2024;

L.N. 345 of 2024;

L.N. 355 of 2024;

L.N. 88 of 2025;

III.2026.69;

L.N. 75 of 2026.

This Part applies to the supplies listed herein subject to the definitions contained

in Part Five.

Exports and like transactions

1. (1) The supply of goods dispatched or transported to a destination outside

the Community by or on behalf of the seller.

(2) The supply of goods transported to a destination outside the Community by

or on behalf of a purchaser not established within Malta, with the exception of goods

transported by the purchaser himself for the equipping, fuelling and provisioning of

pleasure boats and private aircraft or any other means of transport for private use.

(3) The supply of services other than those exempted by item 5, consisting of

work on movable goods acquired or imported for the purpose of undergoing such

work within Malta, and transported outside the Community by the performer of the

services or by the customer if not established within Malta, or on behalf of either of

them.

International goods traffic

2. (1) The supply of goods intended to be placed or while they are placed

under a customs duty suspension regime.

(2) The supply of services other than those exempted by item 6, consisting in

work on movable goods that are intended to be placed or while they are placed under

a customs duty suspension regime.

Intra-community supplies

3. (1) The intra-community supply of goods to a person who is identified on

the relative invoice as a person identified for value added tax purposes by a valid and

active value added tax identification number in a Member State other than Malta,

excluding

(a) a supply made by a person registered under articles 11 and 11B.

(b) a supply that is subject to the special scheme of the profit margin in

terms of Part Two of the Fourteenth Schedule

Provided that, the exemption provided for under this sub-item shall not

apply where the supplier has not complied with the obligation to submit a

recapitulative statement in terms of article 30(2) or the recapitulative

statement submitted by him does not indicate the correct information

concerning the supply as required in terms of the said article 30(2), unless

the supplier can duly justify his shortcoming to the satisfaction of the

Commissioner.

(2) The intra-community supply of new means of transport to a person who is

not identified for the purpose of that supply by a value added tax identification

number.

(3) The intra-community supply of excise goods to a person who is not

identified for the purpose of that supply by a value added tax identification number

where the transport of the goods is carried out in accordance with Article 7 (4) and

(5), or Article 16 of Directive 92/12/EEC, excluding

(a) a supply made by a person registered under articles 11 and 11B.

(b) a supply that is subject to the special scheme of the profit margin in

terms of Part Two of the Fourteenth Schedule.

(4) The intra-community supply of goods referred to in item 17(1) of the Second

Schedule which would benefit from the exemption referred to in paragraph (1) of

this item if it were made on behalf of another taxable person, excluding a supply that

is subject to the special scheme of the profit margin in terms of Part Two of the

Fourteenth Schedule.

International transport and ancillary services

4. (1) The international transport of persons; the transport of luggage and

motor vehicles accompanying passengers and the supply of services related to the

international transport of passengers.

(2) The transport of goods from a third territory and the supply of services

ancillary thereto, where the value of these transport and ancillary services are

included in the taxable value of the importation of those goods.

(3) The transport of goods which is directly connected with the export of those

goods outside the Community.

(4)

The transport of goods that are subject to a customs duty suspension regime.

(5) The supply of services used for the purposes of transport referred to in

paragraph (3) and (4) and relating to the loading, unloading, transhipment, handling,

stowage, weighing, measuring, control, valuation, storage, supervision or delivery.

(6) The supply of services relating to customs formalities on importation into or

exportation outside the Community or on transit.

(7) The intra-community transport of goods effected to or from the islands

composing the autonomous regions of Azores or Madeira as well as ancillary

services thereto.

Brokers or other intermediaries

5. The supply of services of brokers and other intermediaries who act in the

name and for the account of another person when these persons take part in

operations exempted by items 1, 2, 6, 7, 8, 9 and 10 of this Part of the Schedule.

Sea vessels

6. (1)

The supply of vessels

(a) used for navigation on the high seas and carrying passengers for reward

or used for the purpose of commercial, industrial or fishing activities;

(b) used for rescue or assistance at sea or for coastal fishing;

(c) of war.

(2) The supply to constructors, owners or operators of the vessels referred to in

(1) of equipment incorporated or used therein.

(3) The supply of services consisting of the modification, maintenance,

chartering and hiring of the vessels referred to (1) or equipment referred to in (2).

(4) The supply to the owners or to the operators of vessels referred to in (1) of

goods for the fuelling or provisioning thereof: provided that -

(a) with respect to vessels used for coastal fishing, this exemption is not

applicable for board provisioning, and

(b) with respect to war vessels, this exemption is limited to the fuelling and

provisioning destined for vessels defined in subheading 89.01 of the

Customs Tariff, leaving the country and bound for foreign ports or

anchorages.

(5) The supply of services other than those referred to in (3), carried out for the

direct needs of vessels referred to in (1), with the exception of war vessels, and for

the direct needs of their cargo such as towage, pilotage, mooring, rescue services,

valuation, use of the ports, services provided to the ship-owners by the maritime

agents acting as such, services necessary for the entrance, departure or stay of the

vessels in ports, and assistance provided to the passengers or the crew for the

account of the shipowners.

Aircraft

7. (1) The supply of aircraft destined to be used by airline operators for reward

chiefly for international transport of passengers and/or goods.

(2) The supply to constructors, owners or operators of aircraft referred to in (1)

of equipment incorporated or used therein.

(3) The supply of services consisting of the modification, maintenance,

chartering and hiring of aircraft referred to in (1) or equipment referred to in (2).

(4) The supply to the owners or to the operators of aircraft referred to in (1) of

goods for the fuelling or provisioning thereof.

(5)

The supply of services other than those referred to in (3), carried out for the

direct needs of aircraft referred to in (1) and for the direct needs of their cargo such

as towage, pilotage, rescue services, valuation, use of the airports, services provided

to aircraft operators by their agents acting as such, services necessary for the

landing, take off or stay in airports, and assistance provided to the passengers or the

crew for the account of the airline operators.

Gold

8. (1)

The supply of gold to the Central Bank of Malta.

(2) The supply of investment gold, including investment gold represented by

certificates for allocated or unallocated gold or traded on gold accounts and

including, in particular, gold loans and swaps, involving a right of ownership or

claim in respect of investment gold, as well as transactions concerning investment

gold involving futures and forward contracts leading to a transfer of right of

ownership or claim in respect of investment gold.

(3) The supply of services of agents who act in the name and for the account of

another when they intervene in the supply of investment gold for their principal.

(4) The exemptions in paragraphs (2) and (3) shall be subject to the option for

taxation in terms of Part Six of the Fourteenth Schedule.

Food

9. The supply of food for human consumption, excluding food supplied in the

course of catering.

Pharmaceutical goods

10. The supply of pharmaceutical goods.

10A. Until the 31 December 2022, services closely linked to COVID-19 vaccines

falling under sub-heading 3002.20 of the Customs Tariff contained in the First Schedule

to the Import Duties Act.

Transport

11. The supply of

(a) transport by scheduled bus service consisting of trips on scheduled

routes;

(b) scheduled inter-island sea transport of passengers by authorised carriers

and other services of scheduled sea transport of passengers recognised

as such by the Commissioner;

(c) special regular services consisting in the carriage of school pupils and

students to and from an educational establishment recognised as such by

the Commissioner;

(d) special regular services consisting in the carriage of workers to and

from their work; and

(e) scheduled passenger transport services by means of public lift recognised

as such by the Commissioner.

Supplies of goods on board cruise liners

12. The supply of goods for consumption on board cruise liners where the place

of taxation in terms of item 3 of the Third Schedule to the Act is deemed to be in

Malta.

Supplies of goods in accordance with sub-item (2) of item 12A of the Second

Schedule

13. The supply of goods to a taxable person who is deemed to have received and

supplied those goods in accordance with sub-item (2) of item 12A of the Second

Schedule.

Certain transactions treated as exports

14. (1)

The supply of goods or services to the European Commission or to

an agency or a body established under European Union law where the European

Commission or such an agency or body purchases those goods or services in the

execution of the tasks conferred on it by European Union law in order to respond to the

COVID-19 pandemic, except where the goods and services purchased are used, either

immediately or at a later date, for the purposes of onward supplies for consideration by

the European Commission or such an agency or body

Provided that, when the conditions for the exemption cease to apply, the

European Commission or the agency or body concerned which received the exempt

supply shall inform the Commissioner and the supply of those goods or services shall be

subject to tax under the conditions applicable at that time.

(2)

The supply of goods or services within Malta, intended either for the armed

forces of other Member States for the use of those forces, or of the civilian staff

accompanying them, or for supplying their messes or canteens when such forces take

part in a defence effort carried out for the implementation of a European Union activity

under the common security and defence policy.

(3) The supply of goods or services to another Member State, intended for the

armed forces of any Member State other than the Member State of destination itself,

for the use of those forces, or of the civilian staff accompanying them, or for

supplying their messes or canteens when such forces take part in a defence effort

carried out for the implementation of a European Union activity under the common

security and defence policy.

Supplies of certain devices and aids to non-profit making organisations

15. The supply to non-profit making organisations specifically recognised as such by

the Commissioner for this purpose, of devices and aids, including related goods, which are

essential to compensate or overcome disability in humans.

Products used for female sanitary protection

16. The supply of products used for female sanitary protection.

Medical items essential to compensate and overcome cancer in humans

17. The supply of

(a)

mastectomy undergarments;

(b)

urinary incontinence management devices;

(c)

vacuum constriction devices;

(d)

scalp cooling systems;

(e)

absorbent incontinence care products; and

(f)

supportive medical undergarments.

Supplies for the benefit of disaster victims.

18. The supply of goods for the benefit of disaster victims, and services related

to such goods supplied or acquired including rental services, subject to the

conditions and limitations established under Article 101a of Council Directive 2006/

Part Two

Exemptions without credit

This Part applies to the supplies listed herein subject to the definitions contained

in Part Five. Items 2 and 3 are without prejudice to item 5 of Part One.

Immovable property

1. (1)

The letting of immovable property excluding -

(a) the letting of or the provision of accommodation in any premises which

for the purpose of the said letting or accommodation is required to be

licensed in virtue of the Malta Travel and Tourism Services Act, or any

Act which may be substituted therefor or in a holiday camp or camping

site;

(b) the letting of premises and sites for parking vehicles where such

premises or sites have been designated by the Commissioner as parking

areas or which fall to be treated as such in terms of such regulations as

may be prescribed;

(c) the letting of permanently installed equipment and machinery and the

hire of safes;

(d) the letting of property by a limited liability company to a person

registered under article 10 for the purpose of the economic activity of

that other person;

(e) the letting of immovable property for not more than thirty days by a

taxable person in the course of an economic activity, except for

(i) the letting referred to in sub-paragraphs (a), (b), (c) and (d);

(ii) the letting of space for artistic and cultural activities;

(iii) the letting for the purposes of habitation of any premises which

for the purpose of the said letting, those premises are not required

to be licensed in virtue of the Malta Travel and Tourism Services

Act, or any other Act which my be substituted therefor;

(iv) the letting of premises used or intended to be used as garages,

stores or similar uses;

(v) the letting to players of rooms or other spaces lawfully designated for

the playing of poker.

(2)

The transfer of immovable property.

Insurance services

2. The supply by persons licensed under the Insurance Business Act or the

Insurance Distribution Act, of insurance and reinsurance transactions, including related

services, in respect of which they are so licensed, where those services are specific to

and essential for the provision of insurance or re-insurance transactions

Provided that road assistance services provided for a fixed subscription, by a

taxable person who undertakes to provide such assistance should the risk of breakdown

or accident covered by that person materialise, shall be considered as an exempt supply

of insurance services.

Credit, banking and other services

3. (1) The granting and the negotiation of credit and the management of credit

by the person granting it.

(2) The negotiation of or any dealings in credit guarantees or any other security

for money and the management of credit guarantees by the person who is granting

the credit.

(3) Transactions, including negotiation, concerning deposit and current

accounts, payments, transfers, debts, cheques and other negotiable instruments, but

excluding debt collection and factoring.

(4) Transactions, including negotiation, concerning currency, bank notes and

coins normally used as legal tender.

(5) Transactions, including negotiation, excluding management and

safekeeping, in shares, interest in companies or associations, debentures and other

securities, excluding

(a) documents establishing title to goods;

(b) certain interest in immovable property;

(c) rights in rem giving the holder thereof a right of user over immovable

property;

(d) shares or interests equivalent to shares giving the holder thereof de jure

or de facto rights of ownership or possession over immovable property

or part thereof.

(6) The supply of services consisting of the management of any investment

scheme, provided that these services are limited to those activities that are specific to

and essential for the core activity of the scheme

Provided further that investment schemes shall refer to

"collective investment scheme" as defined under the Investment

Services Act;

"retirement scheme" as defined under the Retirement Pensions Act;

"securitisation vehicle" as defined under the Securitisation Act; and

"authorised reinsurance special purpose vehicle" as defined in the Re-

Insurance Special Purpose Vehicle Regulations.

Cultural and religious services

4. (1)

Religious services.

(2) The supply of such cultural services and goods closely linked thereto as may

be approved by the Minister.

Sports

5. The supply by non-profit making organisations of such services related to

sport or physical recreation and provided to persons taking part in sport or

educational education as may be approved by the Minister.

Services related to certain exempt services

6. (1) The supply of staff by religious and philosophical institutions

recognised as such by the Commissioner for the purpose of providing services

referred to in paragraph (2) or (4) of item 11 or in paragraph (1) or (2) of item 12 of

this Part with a view to spiritual welfare.

(2) The supply of goods and services by a non-profit making organisation in

connection with events, organised exclusively for their own benefit, designed to

raise funds which shall be used for the provision of goods and services which are

exempt in terms of sub-items (2) or (4) of item 11 or of sub-items (1) or (2) of item

12 of this Part

Provided that the event is recognised by the Commissioner as being exclusively

designed for the said purpose and provided that this exemption is not likely to cause

distortion of competition.

Services supplied by independent groups

7. Services supplied by independent groups of persons whose activities are

exempt from or not subject to value added tax, for the purpose of rendering to their

members the services directly necessary for the exercise of their activity, where

these groups merely claim from their members exact reimbursements of their share

of the joint expenses, provided that such exemption is not likely to produce

distortion of competition.

Services by non-profit making organisations to their members

8. The supply of services for the benefit of their members in return for a

subscription fixed in accordance with their rules by non-profit making organisations

with aims of a political, trade union, religious, patriotic, philosophical, philanthropic

or civic nature or whose main purpose is to represent and promote the common

business or professional interests of their members: provided that in any case where,

in the opinion of the Minister, this exemption is likely to cause distortion of

competition, this exemption shall be subject to such exceptions or limitations as the

Minister may by order in writing determine.

Lotteries

9. Government lotto and lotteries, the supply of agency services related

thereto, and such other supplies related to gambling as may be approved by the

Minister.

Postal Services

10. The supply of public postal services, other than passenger transport and

telecommunication services, and of goods, including postage stamps, incidental

thereto.

Health and Welfare

11. (1) The provision of medical care by a person in the exercise of any profession

regulated by the Health Care Professions Act (Cap. 464), the Psychology Profession Act

(Cap. 471), the Counselling Profession Act (Cap. 538), the Psychotherapy Profession

Act (Cap. 587), or any Act which may substitute them.

(2) The provision of hospital and medical care undertaken by any government

hospital or institution, or by any other hospital, institution or centre for medical

treatment or diagnosis approved by the Minister for the purposes of this sub-item.

(3) The supply of services by dental technicians in their professional capacity and

the supply of dental prostheses by dentists and dental technicians.

(4) The supply of welfare services, including services supplied by homes for the

elderly, and services for the protection and care of children and young people,

supplied by any government institution or by any institution or organisation

recognised by the Commissioner as a non-profit making institution or approved by

the Minister for the purpose of this paragraph as any institution whose activities fall

within the social and welfare policy of the government.

(5) The supply of transport services for sick, injured or disabled persons in

vehicles specially designed for that purpose.

(6)

The supply of human organs, blood and milk.

(7) The supply of goods and services by the same hospital, institution, centre or

home, as the case may be, supplying the services referred to in sub-items (2) and (4), and

which are connected with, and essential for the supply of those services, provided that

this exemption is not likely to cause distortion of competition.

Education

12. (1) The provision of education or educational research, vocational training or

retraining, including distance learning, by a government school or institution, by the

University of Malta, by a school or institution registered under the Education Act, or by

any educational establishment recognized as such by the Commissioner, or by any

establishment recognized for this purpose by the Minister responsible for education.

(2) The provision of education or educational research, including distance

learning, of a kind provided by a school or university, or of religious instruction, by

a non-profit making institution recognised as such by the Commissioner.

(3) Tuition given privately by teachers acting in an independent capacity in

subjects which are normally taught in the course of education provided by a school

or university but excluding tuition in recreational, physical or sporting activities or

disciplines.

(4) Any training in the arts which is provided by an organisation accredited by

the Register for the Accreditation in the Training of the Arts.

(5) The supply of goods and services where the said supply is connected with

and essential for the supply of services referred to in paragraphs (1), (2), (3) and (4)

by the school, institution, university, teacher or organisation, as the case may be,

supplying the said services, or supplied by any other organisation recognised by the

Commissioner as an organisation which has similar objectives.

Supplies of goods in respect of which the supplier had not qualified for input tax

credits

13. The supply of goods which were acquired by that person or which were

manufactured or produced from components acquired by that person under a supply

in respect of which that person did not qualify for any input tax credit.

Broadcasting

14. The activities of public radio and television bodies other than those of a

commercial nature.

Water

15. The supply of water services by a public authority.

Exemption for small enterprises

16. (1) The supply by a person registered under article 11 and entitled to be so

registered, of goods and services in accordance with the provisions of Part One of

the Sixth Schedule.

(2) The supply by a person registered under article 11A and entitled to be so

registered, of goods and services in accordance with the provisions of Part Two of

the Sixth Schedule.

(3) The supply by a person registered under article 11B and entitled to be so

registered, of goods and services in accordance with the provisions of Part Three of

the Sixth Schedule.

Part Three

Exempt intra-community acquisitions

This Part applies to the intra-community acquisitions listed herein subject to the

definitions contained in Part Five.

Intra-community acquisitions made for the purpose of a subsequent supply

1. The intra-community acquisition of goods by a taxable person not

established in Malta and who is identified for value added tax purposes in another

Member State if all the following conditions are fulfilled

(a) the acquisition of the goods is made for the purpose of a subsequent

supply of those goods in Malta by that person;

(b) the goods acquired have been directly transported from a Member State

other than that where that person is identified for value added tax

purposes to the person to whom the subsequent supply is made;

(c) the person to whom the subsequent supply is made is a taxable person or

a non-taxable legal person registered under article 10 or 12;

(d) the person to whom the subsequent supply is made is liable for the

payment of the tax on that supply.

Acquisitions of goods whose supply or importation is exempt

2. The intra-community acquisition of goods the supply of which if made by a

taxable person in Malta would in all circumstances be an exempt supply or the

importation of which if made into Malta would in all circumstances be an exempt

importation.

Acquisitions of goods where the tax would be refundable

3. The intra-community acquisition of goods by a person who is not registered

or required to be registered under article 10 where that person would in all

circumstances be entitled to a refund of the tax that would be due on that acquisition

were it not exempt.

Duty suspension regime

4. The intra-community acquisition of goods intended to be placed under a

customs duty suspension regime.

Food

5. The intra-Community acquisition of food.

Investment gold

6. The intra-community acquisition of investment gold, saving the option for

taxation in terms of Part Six of the Fourteenth Schedule.

Goods subject to the margin scheme

7. The intra-community acquisition of goods that are supplied under a

transaction subject to a margin scheme on second hand goods, works of art,

collectors’ items and antiques in the Member State where the transport begins.

Acquisitions of certain devices and aids by non-profit making organisations

8. The intra-community acquisition by non-profit making organisations

specifically recognised as such by the Commissioner for this purpose, of devices and

aids, including related goods, which are essential to compensate or overcome disability

in humans.

Acquisitions for the benefit of disaster victims.

9. The intra-Community acquisitions of goods for the benefit of disaster victims

subject to the conditions and limitations established under Article 101a of Council

Directive 2006/112/EC.

Part Four

Exempt importations

This Part applies to the importations listed herein subject to the definitions

contained in Part Five.

Importation of goods whose supply is exempt

1. The importation of goods the supply of which by a taxable person in Malta

would in all circumstances be an exempt supply.

Goods exempt from customs duty

2. (a) The importation of goods whose definitive importation into Malta is

exempt from customs duties other than as provided for in the Import

Duties Act.

(b) goods that are intended to be placed under a customs duty suspension

regime.

Objects of a non-commercial nature imported in the personal luggage of

travellers.

2A. The importation of objects, where their total value does not exceed the limits

provided in the Excise Duty (Goods Imported by Persons Travelling from Third

Countries) Regulations. S.L. 382.02.

Importation of goods where VAT shall be declared under the special scheme in

Section 4 of Part Seven of the Fourteenth Schedule

2B. The importation of goods where the VAT shall be declared under the special

scheme in Section 4 of Part Seven of the Fourteenth Schedule and where, at the latest

upon lodging of the import declaration, the individual value added tax identification

number for the application of the special scheme of the supplier or of the

intermediary acting on his behalf, allocated in terms of Section 4 of Part Seven of the

Fourteenth Schedule, has been provided to the competent customs office in Malta.

Goods transported from a third territory

3. The importation of goods transported from a third territory and imported

into Malta where the supply of these goods by the importer is an exempt supply in

virtue of paragraph (1) or (4) of item 3 of Part One of this Schedule.

The exemption provided for under this item shall apply in cases when the

importation of goods is followed by the supply of goods exempted under paragraph

(1) or (4) of item 3 of Part One of this Schedule only if at the time of importation the

importer has provided to the Comptroller of Customs the following information

(a) his VAT identification number issued in terms of article 10 of this Act;

(b) the VAT identification number of the customer, to whom the goods are

supplied in accordance with paragraph (1) of item 3 of Part One of this

Schedule, issued in another Member State, or his own VAT

identification number issued in the Member State in which the dispatch

or transport of the goods ends when the goods are subject to a transfer in

accordance with paragraph (4) of item 3 of Part One of this Schedule;

(c) the evidence that the imported goods are intended to be transported or

dispatched from Malta to another Member State.

In addition, the Comptroller of Customs may impose conditions including the

production of further documentation and security.

Catches of fish

4. The importation into ports by sea fishing undertakings of their catches,

unprocessed or after undergoing preservation for marketing but before being

supplied.

Re-importation

5. The re-importation by the person who exported them outside the

Community

(a) of goods in the state in which they were exported outside the

Community;

(b) of goods which have undergone outside the Community repair,

transformation or adaptation, or after having been made-up or reworked

abroad: provided that this exemption is limited to the value of the goods

at the time they were exported outside the Community.

Food

6. The importation of food.

Investment gold

7. The importation of investment gold, saving the option for taxation in terms

of Part Six of the Fourteenth Schedule.

Importation of gas, electricity, heat or cooling energy, through systems or

networks

8. The importation of gas through a natural gas system or any network

connected to such a system or fed in from a vessel transporting gas into a natural gas

system or any upstream pipeline network, of electricity or of heat or cooling energy

through heating or cooling networks.

Certain importations of goods in an official capacity

9. (a)

The importation of goods by the European Commission or by an

agency or a body established under European Union law where the European

Commission or such an agency or body imports those goods in the execution of tasks

conferred on it by European Union law in order to respond to the COVID-19 pandemic,

except where the goods imported are used, either immediately or at a later date, for the

purposes of onward supplies for consideration by the European Commission or such an

agency or body

Provided that, when the conditions for the exemption cease to apply, the

European Commission or the agency or body concerned shall inform the Comptroller of

Customs and the importation of those goods shall be subject to tax under the conditions

applicable at that time.

(b) The importation of goods by the armed forces of other Member States

for the use of those forces, or of the civilian staff accompanying them,

or for supplying their messes or canteens when such forces take part in a

defence effort carried out for the implementation of a European Union

activity under the common security and defence policy.

Importations of certain devices and aids by non-profit making organisations

10. The importation by non-profit making organisations specifically recognised as

such by the Commissioner for this purpose, of devices and aids, including related goods,

which are essential to compensate or overcome disability in humans.

Part Five

Definitions

For the purposes of this Schedule, the following terms shall have the meaning

assigned to them in this Part.

1. "Food" means the goods specified in the Customs Tariff contained in the

First Schedule to the Import Duties Act under

(a) Chapter 1 but excluding items falling under subheadings 0101.10.10.00;

The provisions of the Second Schedule shall apply for the

purpose of determining any question as to whether an operation is

to be treated as

(a) a supply of goods, a supply of services, an intra-

community acquisition or an importation;

(b) made for consideration;

(c) made by a taxable person acting as such.

Amended by

L.N. 29 of 1999.

Small Enterprises

Substituted by

X. 2003.47.

Amended by

L.N. 122 of 2007;

L.N. 426 of 2007;

L.N. 105 of 2008;

L.N. 137 of 2009;

L.N. 163 of 2018;

L.N. 223 of 2020;

L.N. 463 of 2020;

L.N. 346 of 2024;

IX.2025.74.

Definitions

For the purposes of this Schedule, the following terms shall have the meaning

assigned to them in this Part.

Calendar quarter

1. "calendar quarter" means a period of three (3) calendar months ending on the

31st March, 30th June, 30th September and 31st December, as the case may be.

Calendar year

2. "calendar year" means a period of twelve (12) months commencing on 1st

January and ending on 31st December.

Turnover

3. (1) "turnover" means the turnover consisting of the following amounts,

exclusive of VAT

(a) the value of supplies of goods and services, in so far as they would be

taxed were they supplied by a person registered under article 10;

(b) the value of transactions which are exempt with credit in terms of items

1, 3, 5, 6, 7, and 8(1) of Part One of the Fifth Schedule;

(c) the value of immovable property transactions, financial transactions

referred to in item 3 of Part Two of the Fifth Schedule, and insurance

and reinsurance services, unless those transactions are ancillary

transactions.

(2) Disposals of the tangible or intangible capital assets of a taxable person shall

not be taken into account for the purposes of calculating the turnover referred to in

sub-item (1).

(3) For the purposes of calculating the turnover referred to in sub-item (1) of

persons, other than physical persons, registered or applying to register under article

11, account shall be taken of the turnover of related persons in accordance with the

provisions of item 4 of Part One.

(4)

The turnover shall be denominated in euro (€).

Domestic annual turnover

4. "Domestic annual turnover" means the total annual turnover from supplies of

goods and services, exclusive of VAT, made by a taxable person taking place within

Malta during a calendar year.

Domestic threshold

5. "Domestic threshold" means the threshold fixed in Malta in accordance with

Article 284(1) of Council Directive 2006/112/EC which shall be an amount

equivalent to thirty-five thousand euro (€35,000).

Union annual turnover

6. "Union annual turnover" means the total annual turnover from supplies of

goods and services, exclusive of VAT, made by a taxable person taking place within

the territory of the Community during a calendar year.

Union Threshold

7. "Union Threshold" means an amount equivalent to one hundred thousand

euro (€100,000).

Member State annual turnover

8. "Member State annual turnover" means the total annual turnover in a

Member State from supplies of goods and services, exclusive of VAT, made by a

taxable person within such Member State during a calendar year.

Part One

[Article 11]

Special scheme for small enterprises for supplies made within Malta by persons

established in Malta

Threshold at the time of application

1. A taxable person who applies for registration under article 11 qualifies as a

small enterprise at the time of the application where his Domestic annual turnover

during the preceding calendar year, if any, is not more than the Domestic threshold.

Persons registered under article 10

2. (1) Notwithstanding the provisions of item 1, a person registered under

article 10 who applies for registration under article 11 shall not qualify as a small

enterprise at any time during the first whole twelve (12) calendar months from the

date of the said registration

Provided that a person who is deemed to be registered under article 10 by

virtue of sub-article (6) of the said article shall be deemed for the purpose of this

item as having been registered under the said article on the date on which he was

first registered under this Act.

(2) Notwithstanding the provisions of sub-item (1), where a person who registers

under article 10 makes a request to the Commissioner to convert to a registration

under article 11, the Commissioner may accept the request where

(a) the Commissioner is satisfied that the person qualifies as a small

enterprise; and

(b) such person has not claimed any input tax credits during the period in

which he was so registered under article 10.

Threshold of persons registered under article 11

3. A person registered under article 11 shall continue to qualify as a small

enterprise where his turnover during a calendar year does not exceed the Domestic

threshold

Provided that such person shall no longer qualify as a small enterprise on the

date the Domestic threshold is exceeded within a calendar year.

Turnover of related persons

4. For the purpose of this Part, the turnover of a person, other than a physical

person, registered or applying to register under article 11 shall include the

proportionate turnover of any other person, including a physical person, who is

related to the person registered or applying to be registered under article 11. In this

item, a person shall be deemed to be related to a person registered or applying to be

registered under article 11 where the latter person is owned or controlled, directly or

indirectly, as to more than ten percent (10%) by the former person, or as may be

prescribed by the Commissioner.

Declaration to be submitted to the Commissioner

5. (1) The declaration which is required to be submitted to the Commissioner

by a person registered under article 11 in terms of article 30(1) shall be submitted to

the Commissioner electronically through the web portal designated by the

Commissioner for this purpose and including any information requested therein

Provided that the Commissioner may otherwise direct any person or class of

persons to submit the said declaration by other means.

(2) The declaration referred to in sub-item (1) shall be submitted for a period of

twelve (12) months, or as may be directed by the Commissioner

Provided that persons registered under article 11 may opt for a shorter

period.

(3) The period of twelve (12) months referred to in sub-item (2) shall commence

on the 1st January and end on the 31st December of the same calendar year

Provided that where the effective date of registration of a person under

article 11 is a date other than 1st January, the first period of such person shall

commence on such effective date and shall end on the 31st December of the same

calendar year.

(4) Where a person ceases to be registered under article 11, the last period of

such person shall end on the date when that registration is cancelled by the

Commissioner in accordance with the provisions of articles 11(6), (7) and (8).

(5) A declaration which is required to be furnished for a period to the

Commissioner in terms of this Part shall be so furnished by not later than the

fifteenth (15 th ) day of the second (2) month following the month during which such

period ends.

Other information to be given to the Commissioner

6. A person who applies for registration under article 11 shall submit all

information that the Commissioner may reasonably request for the purpose of

applying the provisions of this Part.

Part Two

[Article 11A]

Special scheme for small enterprises for supplies made in other Member States by

persons established in Malta

Threshold at the time of application

1. (1)A taxable person who applies for registration under article 11A qualifies

as a small enterprise at the time of the application where the following conditions are

satisfied

(a) his Union annual turnover during the preceding calendar year is less

than the Union threshold;

(b) he makes supplies in at least one (1) Member State in which he is not

established, where he is eligible to avail himself of the exemption in

terms of the special scheme for small enterprises applicable in the

respective Member State in accordance with Chapter 1 of Title XII of

Council Directive 2006/112/EC; and

(c) the value of the supplies made in the Member State referred to in

paragraph (b) during the preceding calendar year does not exceed the

threshold applicable in that Member State for granting the exemption in

accordance with Chapter 1 of Title XII of Council Directive 2006/112/

EC

Provided that the period referred to in paragraph (c) may be extended to two (2)

calendar years where required by the respective Member State in accordance with Article

288a(1) of Council Directive 2006/112/EC.

Prior notification

2. An application for a registration under article 11A shall be submitted

electronically directly through the established web portal designated by the

Commissioner for such purpose, and shall contain the following information

(a) the name, activity, legal form and address of the taxable person;

(b) the Member State or Member States in which the taxable person intends

to avail himself of the special scheme for small enterprises;

(c) the turnover from supplies of goods and, or services carried out in Malta

and in each of the other Member States during the previous calendar

year;

(d) the turnover from supplies of goods and, or services carried out in Malta

and in each of the other Member States during the current calendar year

prior to the application for a registration under article 11A; and

(e) any other information requested therein.

Update to a prior notification

3. (1) A taxable person registered under article 11A shall inform in advance the

Commissioner electronically directly through the established web portal designated

by the Commissioner for such purpose of any changes to the information previously

provided in the prior notification referred to in item 2, including

(a) the intention to avail himself of the exemption in a Member State or

Member States other than the ones indicated in such prior notification; and

(b) the decision to cease applying the special scheme for small enterprises

in a Member State or Member States in which such taxable person is not

established.

(2) The exemption in any Member State referred to in sub-item (1)(a) shall be

effective as from the date the Commissioner notifies the taxable person that he may

start to avail himself of the exemption in the respective Member State.

(3) The cessation referred to in sub-item (1)(b) shall be effective as of the first

(1) day of the next calendar quarter following the receipt of the information from the

taxable person or, where such information is received during the last month of a

calendar quarter, as of the first (1) day of the second (2) month of the next calendar

quarter.

Declaration to be submitted to the Commissioner

4. (1) The declaration which is required to be submitted to the Commissioner

by a person registered under article 11A in terms of article 30(1) shall be submitted

to the Commissioner electronically through the web portal designated by the

Commissioner for this purpose and including the following information

(a) the turnover from supplies carried out during the calendar quarter in

Malta or "0" if no supplies have been made;

(b) the turnover from supplies carried out during the calendar quarter in

each of the Member States other than Malta or "0" if no supplies have

been made;

(c) where the Member State in which the special scheme for small

enterprises is availed of applies varying thresholds as referred to in the

second sub-paragraph of Article 284(1) of Council Directive 2006/112/

EC, the taxable person shall be obliged in respect of such Member State

to report separately the total value of supplies of goods and, or services

as regards each threshold that may be applicable; and

(d) any other information requested therein.

(2)

The values referred to in sub-item (1) shall be denominated in euro (€)

Provided that where the Member State in which the special scheme for small

enterprises is availed of has not adopted the euro (€), the Commissioner may require

such values to be expressed in the national currencies of those Member States. If the

supplies have been made in other currencies, the taxable person shall use the

exchange rate which applies on the first (1) day of the calendar year. The conversion

shall be made by applying the exchange rate published by the European Central

Bank for that day or, if there is no publication on such day, on the next day of

publication.

(3) The declaration referred to in sub-item (1) shall be furnished for each

calendar quarter.

(4) Where the effective date of registration of a person under article 11A is a

date other than the first (1) day of a calendar quarter, the first (1) period of such

person shall commence on such effective date and shall end on the last day of the

said calendar quarter.

(5) Where a person ceases to be registered under article 11A, the last period of

such person shall end on the date when the said registration is cancelled by the

Commissioner in accordance with article 11A(5).

(6) A declaration which is required to be submitted to the Commissioner in

terms of this Part shall be so submitted by not later than the last day of the month

following the end of the respective calendar quarter

Provided that, in accordance with article 11A(4)(c), the taxable person shall

inform the Commissioner within fifteen (15) working days from the date when the

Union annual turnover threshold is exceeded. At the same time, the taxable person

shall submit to the Commissioner a further declaration electronically through the

web portal designated by the Commissioner for this purpose, indicating the value of

the supplies referred to in sub-item (1) that have been made from the beginning of

the current calendar quarter up until the date the Union annual turnover threshold

was exceeded.

Exceeding the Union Threshold

5. Notwithstanding the provisions of article 11A(5), where the Union annual

turnover of a person registered under the said article during a calendar year exceeds the

Union threshold, the exemption provided for in article 284(1) of Council Directive 2006/

112/EC granted in the Member States in which such person is not established shall cease

to apply as from the date the Union threshold is exceeded.

Part Three

[Article 11B]

Special scheme for small enterprises for supplies made within Malta by persons

established in other Member States

1. A taxable person established in another Member State deemed to have made

a registration under article 11B may be approved by the Commissioner where he

qualifies as a small enterprise at the time of the application by satisfying the

following conditions

(a) his Union annual turnover during the preceding calendar year is less than

the Union threshold; and

(b) the Domestic annual turnover during the preceding calendar year does

not exceed the Domestic turnover threshold.

Exceeding the Domestic threshold

2. Notwithstanding the provisions of article 11B(3), where the Domestic annual

turnover of a person registered under the said article during a calendar year exceeds

the Domestic threshold, the exemption provided for in item 16(3) of Part Two of the

Fifth Schedule shall cease to apply as from the date the Domestic threshold is

exceeded.

Exceeding the Union Threshold

3. Notwithstanding the provisions of article 11B(3), where the Union annual

turnover of a person registered under the said article during a calendar year exceeds

the Union threshold, the exemption provided for in item 16(3) of Part Two of the

Fifth Schedule shall cease to apply as from the date the Union threshold is exceeded.

The provisions of the Third Schedule shall apply for the

purpose of determining the place where a supply or an intra-

community acquisition or an importation takes place.

Substituted by

X. 2003.47.

[Article 18]

Amended by

L.N. 335 of 2008;

Taxable value

L.N. 420 of 2012;

L.N. 52 of 2021;

III.2026.70.

Taxable value of supplies

1. Except as otherwise provided in the other provisions of this Schedule, the

taxable value of a supply shall be the total value of the consideration paid or payable

to the supplier by the purchaser, the customer or any other person for the supply,

including any subsidy directly linked to the provision of that supply, but excluding

the value added tax chargeable under this Act on that supply.

2. The taxable value of a supply shall include, insofar as they are not included

in the value determined under item 1

(a) taxes, duties, levies, fees and other charges (excluding the value added

tax chargeable under this Act) payable by reason of the supply;

(b) incidental expenses, such as commissions, packing, transport and

insurance costs charged by the supplier to the purchaser or customer

even if they are covered by a separate agreement or a separate

document.

3. The taxable value of a supply shall not include

(a) price reductions by way of discounts for early payment;

(b) rebates and other price reductions allowed directly by the supplier to the

customer and accounted for at the time when the tax becomes

chargeable;

(c) penalties and interests charged for late payment after the time of the

supply;

(d) disbursements paid in the name and for the account of the person to

whom the supply is made, and resulting from documents held by the

supplier to have been so paid, which are entered in the records of the

supplier in a suspense account;

(e) any amount charged to the customer by way of a deposit on returnable

packing of goods where the deposit is lower than the cost of the packaging

or where the deposit is regulated in terms of the Beverage Containers

Recycling Regulations or any law which may be substituted therefor.

4. When, after a supply takes place -

(a) the consideration for that supply is reduced by way of a price discount

or rebate allowed to the customer for bona fide commercial reasons;

(b) the consideration for that supply is not payable or is repayable to the

customer on account of the rescission of the contract for that supply

which is declared by means of a definitive judgment or arbitration

award or is agreed to by the parties in writing on grounds that would

have been sufficient in a court of law for that rescission;

(c) the amount due as consideration for that supply becomes a bad debt,

the taxable value of that supply shall be reduced accordingly: provided that no

adjustment shall be made to the tax chargeable on that supply by reason of such a

reduction except in the manner provided in the Tenth Schedule.

5. (1) When the consideration is paid or payable wholly or partly in kind or

where the value of the consideration for a supply cannot be readily determined, the

taxable value of that supply shall be, to the extent that the consideration is so paid or

cannot be so determined, its open market value.

(2) The open market value of goods or services means the price which they

would fetch if sold or provided in the open market on the date and in the state they

were in when the said goods are delivered or the said services are performed.

6. (1) The taxable value of a supply consisting of the application or disposal of

goods for which no consideration is charged or paid but which is deemed in terms of

the Second Schedule to be a supply of goods made for consideration, and the taxable

value of a transport of goods that is treated as a supply in terms of item 17 of the

Second Schedule (Transfer of goods to another Member State), is the purchase price

of those or similar goods or, in the absence of a purchase price, the cost price,

determined at the time of the supply.

(2) The taxable value of a self-supply of services is the full cost to the person

making the supply of providing those services.

7. The taxable value of a supply consisting in the transfer of goods by order

made by or in the name of a public authority or in pursuance of the law against

payment of compensation is the compensation for that transfer.

8. (1) Where the factors used to determine the taxable amount on importation

are expressed in a currency other than in Euro, the exchange rate shall be determined

in accordance with the Community provisions governing the calculation of the value

for customs purposes.

(2) Where the factors used to determine the taxable amount of a transaction

other than the importation of goods are expressed in a currency other than in Euro,

the exchange rate applicable shall be the latest selling rate recorded, at the time the

tax becomes chargeable, applied by commercial banks in Malta.

(3) The use of the latest exchange rate published by the European Central Bank

at the time the tax becomes chargeable shall also be accepted. Conversion between

currencies other than the Euro shall be made by using the Euro exchange rate of each

currency.

Taxable value of certain supplies between related persons.

8A. (1)

In respect of the supply of goods or services by a person to a related

person, the taxable amount shall be the open market value of such goods or services

where

(a) the consideration is lower than the open market value and the recipient

of the supply does not have a full right of deduction in accordance with

the provisions of the Tenth Schedule;

(b) the consideration is lower than the open market value and the supplier

does not have a full right of deduction in accordance with the provisions

of the Tenth Schedule and the supply is subject to an exemption in

accordance with Part Two of the Fifth Schedule; or

(c) the consideration is higher than the open market value and the supplier

does not have a full right of deduction in accordance with the provisions

of the Tenth Schedule.

(2)

For the purpose of this item a person shall be deemed to be a "related person" to

another person where

(a) that person is part of the same family as the other person;

(b) that person is an employee, including a holder of office, of the other

person, and including any family member of that employee;

(c) those persons are cohabitants;

(d) those persons, directly or indirectly, jointly own and, or hold the same

asset;

(e) any persons who owns and, or holds, directly or indirectly, as to more

than fifty per cent (50%) of their ordinary share capital or equivalent

interests, voting rights or equivalent rights, or rights to profits available

for distribution, by the related persons referred to in paragraphs (a) to

(c);

(f)

one (1) person owns and, or holds, directly or indirectly, more than fifty

per cent (50%) of the ordinary share capital or equivalent interests,

voting rights or equivalent rights, or rights to profits available for

distribution, of the other person;

(g) those persons who own and, or hold, directly or indirectly, as to more

than fifty per cent (50%) of their ordinary share capital or equivalent

interests, voting rights or equivalent rights, or rights to profits available

for distribution, by the same person or persons; or

(h) those persons collectively own and, or hold, directly or indirectly, as to

more than fifty per cent (50%) of the ordinary share capital or

equivalent interests, voting rights or equivalent rights, or rights to

profits available for distribution, of another person

Provided that where a person is deemed to be a "related person" to

another person in accordance with this sub-item, any immediate family

members of such person shall also be deemed to be a related person to

the other person.

(3)

For the purposes of this item, "open market value" shall mean the full amount

that, in order to obtain the goods or services in question at that time, a customer at the same

marketing stage at which the supply of goods or services takes place, would have to pay,

under conditions of fair competition, to a supplier at arm’s length within the territory of the

Member State in which the supply is subject to tax

Provided that where no comparable supply of goods or services can be

ascertained, "open market value" shall mean the following

(a) in respect of goods, an amount that is not less than the purchase price of

the goods or of similar goods or, in the absence of a purchase price, the

cost price, determined at the time of supply; and

(b) in respect of services, an amount that is not less than the full cost to the

taxable person of providing the service.

Taxable value of intra-community acquisitions

9. The taxable value of a taxable intra-community acquisition is the amount

which would represent the taxable value in terms of this Schedule of the supply

pursuant to which that acquisition is made if that supply were a taxable supply, and

shall include any excise duty paid or payable in a Member State by the person

making that acquisition on the goods acquired.

10. (1) When the taxable value of an intra-community acquisition includes

excise tax paid or payable in a Member State other than Malta and the person who

makes the acquisition qualifies for a refund of that excise tax, the value of that

acquisition shall be reduced proportionately.

(2) When an intra-community acquisition is treated as taking place in Malta by

reason of the fact that it was made by a person identified for the purpose of that

acquisition by a value added tax identification number issued by the Commissioner

and is subsequently also treated as taking place and subject to tax in another Member

State by reason of the fact that the transport of the goods ends in that State, the

chargeable value of that acquisition under this Act shall be reduced by the amount

subject to tax in that other Member State.

(3) When the value of a supply pursuant to which an intra-community

acquisition is made is reduced after that acquisition takes place for any of the

reasons mentioned in item 4 the taxable value of the acquisition shall be reduced

accordingly.

(4) When the taxable value of an intra-community acquisition is reduced in any

of the circumstances mentioned in this item, the tax on that acquisition

corresponding to that reduction shall, if paid, be treated as tax paid but not due for

the purposes of article 69 of this Act.

Taxable value of importations

11. Subject to the other provisions of this Schedule, the taxable value of an

importation of goods shall be the value established in terms of the Import Duties Act

for the determination of the value on which duty ad valorem is chargeable under that

Act, and all the relevant provisions of that Act shall apply mutatis mutandis, and for

the purpose of this item the references in the said provisions to the Comptroller of

Customs shall be construed as references to the Comptroller of Customs acting on

behalf of the Commissioner.

12. The value established under item 11 shall be increased, insofar as they are

not included in the value determined in accordance with item 11, by

(a) any taxes, levies, duties and other charges due outside Malta, any

import duties chargeable on the said importation under the Local

Manufactures (Promotion) Act, any excise duty payable under the

Excise Duty Act by reason of the importation of those goods;

(b) incidental expenses, such as commissions, packing, customs agency

costs and transport and insurance costs incurred up to the delivery of the

goods to the destination in Malta indicated on the document by means

of which the goods are imported or, in the absence of such an indication,

the place of the first transfer of the goods in Malta;

(c) costs for the transport of the goods to another destination within the

Community if that destination is known at the time of the importation.

13. The taxable value of an importation shall not include

(a) rebates and other price reductions allowed directly by the supplier to the

customer and accounted for at the time of the importation;

(b) price reductions by way of discount for early payment.

The date when a chargeable event takes place and the date

when tax thereon becomes chargeable shall be determined in

accordance with the provisions of the Fourth Schedule.

Amended by

L.N. 273 of 2000;

[Article 19(2)]

L.N. 25 of 2001;

L.N. 388 of 2002;

Rate of tax

L.N. 375 of 2003;

L.N. 384 of 2003;

L.N. 149 of 2004.

Substituted by

X. 2003.47.

Amended by

L.N. 251 of 2004;

L.N. 376 of 2004;

L.N. 436 of 2004;

L.N. 123 of 2007;

L.N. 446 of 2007;

L.N. 235 of 2009;

L.N. 499 of 2010;

L.N. 523 of 2010;

L.N. 381 of 2011;

L.N. 500 of 2011;

L.N. 39 of 2012;

L.N. 64 of 2015;

L.N. 43 of 2016;

L.N. 434 of 2018;

L.N. 186 of 2020;

L.N. 5 of 2021;

L.N. 231 of 2023;

L.N. 354 of 2024;

IX.2025.75;

III.2026.71.

The tax chargeable under this Act on the taxable value of the supplies or

importations in the case of item 7, described in the first column of the Table in this

Schedule shall be at the rate specified in the second column of that Table.

TABLE

First Column

Second Column

Description

1. Accommodation

The letting of or the provision of accommodation in any premises

which for the purpose of the provision of such accommodation is

required to be licensed in virtue of the Malta Travel and Tourism

Services Act, or any other Act which may be substituted therefor

P r o v i d e d t h a t w h e r e t h e p r i c e c h a rg e d f o r t h e s u p p l y o f

accommodation includes the supply of goods or services not

falling within the meaning of accommodation the taxable value of

the supply of accommodation shall be deemed to be eighty percent

of the said price and twenty percent of that price shall be deemed

to be the taxable value of supplies not described in this Column.

2. The supply of electricity.

3. Consumable goods and other similar goods and similar items

The goods falling under CN code in the Common Customs Tariff

(a) 1207.30.90 and 1207.99.91;

(b) 1302.11.00; 1302.14.00; 1302.19.05; 1302.19.30;

1302.19.91; 1302.19.98; 1302.20.10 and 1302.20.90;

(c) 1503.00.19; 1517.90.93; 1520.00.00 and 1522.00.10;

(d) 1702.90.10; 1704.10.11; 1704.10.19; 1704.10.91;

1704.10.99; 1704.90.10; 1704.90.55; 1704.90.61;

1704.90.65; 1704.90.71; 1704.90.75 and 1704.90.81;

(e) 2006.00.10 and 2009;

(f)

family packs as defined in item 2(b) of Part Five of the

Fifth Schedule to the Act falling under CN codes

2105.00.10; 2105.00.91 and 2105.00.99;

(g) 2501.00.10;

(h) 3302.10.21.

4. Medical accessories

The goods falling under CN code in the Common Customs Tariff

(a) 2905.45.00;

(b) 3001 and 3002 except where the use of items under these

sub-headings is for therapeutic or prophylactic purposes;

3005 and 3006;

(c) 3306 and solutions for contact lenses falling under CN

code 3307.90.00;

(d) 3407.00.00;

(e) 3822.00.00; 3824.90.61 and 3824.90.62;

(f)

Deleted by Legal Notice 354 of 2024;

(g) 7015.10.00;

(h) 9001.30.00; 9001.40.41; 9001.40.49; 9001.40.80;

9001.50.41; 9001.50.49; 9001.50.80; 9004.90.10;

9004.90.90; 9021.21.10 and 9021.21.90;

(i)

protective face masks and visors, excluding diving

equipment;

(j)

until the 31 December 2022, 9027.80.80 and 3821.00

where the goods under these sub-headings consist of

COVID-19 in vitro diagnostic medical devices.

4A. Services closely linked to COVID-19 in vitro diagnostic

devices

Until the 31 December 2022, services closely linked to goods

under sub-headings 3822; 3002.15; 9027.80.80 and 3821.00 where

the goods under these sub-headings consist of COVID-19 in vitro

diagnostic devices.

5. Printed matter

The goods falling under CN code in the Common Customs Tariff

(a) 4820.20.00;

(b)

Chapter 49 but excluding items falling under CN code

4905.10.00; 4906.00.00; 4907.00.10; 4907.00.90.00;

4908.10.00; 4908.90.00; 4909 and 4911.91.00;

(c) audio books, books and similar printed matter, other than

books and similar printed matter referred to in paragraphs

(a) and (b), supplied on all physical means of support

which include, but not limited to, a CD, DVD, SD-card

and USB, but which excludes publications wholly or

predominantly devoted to advertising and excluding also

publications wholly or predominantly consisting of video

content or audible music;

(d) audio books, books and similar printed matter, other than

books and similar printed matter referred to in paragraphs

(a) and (b), supplied electronically but which excludes

publications wholly or predominantly devoted to

advertising and excluding also publications wholly or

predominantly consisting of video content or audible

music.

6. Items for the exclusive use of the disabled

(a) raised toilet seats for use by disabled persons falling

under CN code 3924.90.90;

(b) pressure relief cushions for use by disabled persons

falling under CN codes 4014.90; 8714.20.00 and

9404.90;

(c) padded/inflatable toilet seats for use by disabled

persons falling under CN codes 4016.95.00 and

4016.99.98;

(d) pressure relief mattresses for use by disabled persons

falling under CN codes 6306.41.00; 6306.49.00;

9404.21 and 9404.29;

(e) white sticks for use by disabled persons falling under

CN code 6602.00.00;

(f)

walking sticks and ferrules for use by disabled persons

falling under CN code 6603.90.00;

(g) gutter frames for use by disabled persons falling under

CN codes 7325.10; 7325.99; 7326.19; 7326.90 and

7907.00;

(h) hoists for use by disabled persons falling under CN

codes 8425.11.90 and 8425.19.91;

(i)

platform lift/swimming pool lifters for use by disabled

persons falling under CN codes 8428.10.91 and

8428.20.99;

(j)

chairlifts for use by disabled persons falling under CN

code 8428.60.00;

(k) bath tub lifters for use by disabled persons falling

under CN code 8428.90.98;

(l)

braille typewriters for use by disabled persons falling

under CN code 8469.12.00; 8469.20.00 and

8469.30.00;

(m)

amplifiers for communication devices for people with

impaired hearing for use by disabled persons falling

under CN codes 8518.40.91 and 8518.40.99;

(n) children special walkers, prone standers and

wheelchairs (manual) for use by disabled persons

falling under CN code 8713.10.00;

(o) wheelchairs (electrical) for use by disabled persons

falling under CN code 8713.90.00;

(p) car adaptation-handcontrols, swivel seats for use by

disabled persons falling under CN codes 9401.30.10

and 9401.30.90;

(q) toilets frames/surrounds for use by disabled persons

falling under CN code 9401.79.00;

(r) special feeder chairs for use by disabled persons

falling under CN code 9402.90.00;

(s) lifts to get wheelchair into a car for use by disabled

persons falling under CN code 8428.90.98;

(t)

mouthsticks for use by disabled persons falling under

CN code 9608.39.90;

(u) special seats/buggies/wheelchairs for use by disabled

persons falling under CN code 8713.10.00.

7. The importation of works of art, collector’s items and antiques as

defined in paragraphs 1, 2 and 3 of Part Two of the Fourteenth

Schedule.

8. Minor repairing of

(a) bicycles;

(b) shoes and leather goods;

(c) clothing and household linen (including mending and

alteration.

9. Domestic care services such as home help and care of the

young, elderly, sick or disabled.

10. Admission to museums, art exhibitions, concerts and theatres.

11. Use of sporting facilities.

12. Custody and management of securities.

13. Management of credit and credit guarantees by a person or body

other than those who granted the credit.

14. Hiring of a pleasure boat to a person according to an agreement for

any term or part of a term that, when added to the term of a previous

hiring, of the same goods or of other goods of the same kind, to the said

person during the previous twelve (12) months ending on the date of

the beginning of the existing hiring, does not exceed five (5) weeks.

15. Services consisting of the care of the human body required to

be delivered by a person in the exercise of any profession regulated by

the Health Care Professions Act (Cap. 464), including services supplied

in the course of a health studio business or similar business, but not

including exempt supplies referred to in item 11 of Part Two of the

Fifth Schedule.

(1)

There shall be exempt from tax -

(a) the supplies to which Part One or Part Two of the Fifth

Schedule applies;

(b) the intra-community acquisitions to which Part Three

of the Fifth Schedule applies;

(c) the importations to which Part Four of the Fifth

Schedule applies.

(2) Any provision contained in or under any law empowering

the Minister to grant an exemption from import duties on the

importation of goods chargeable under the Import Duties Act shall

be construed as empowering the Minister to grant, in the same

circumstances, in the same manner, and subject to the same

conditions and limitations provided for in any such provision, an

exemption from tax chargeable under this Act on the importation of

the said goods.

(3)

The Minister may by regulations prescribe for the

exemption from tax on

(a)

supplies made to;

(b)

intra-community acquisitions made by; and

(c)

importations made by,

diplomatic or consular arrangements or a person who qualifies for

an exemption from tax in accordance with such international

arrangements as the Minister may in accordance with such regulations

prescribe

Provided that the grant of such exemption shall be subject to

such conditions and limitations as may be established in the said

regulations.

PART III

Registration and Tax Period

10.(1) (a) A taxable person established in Malta who is not

registered under this article or under article 11 shall

apply to be registered under this article by not later

than thirty days from the date on which he makes a

supply for consideration in Malta other than an exempt

without credit supply.

(b) A taxable person established in Malta who is not

registered under this article or under article 11 and who

supplies services within the territory of another Member

State for which the tax is payable solely by the recipient

shall apply to be registered under this article by not later

than thirty days from the date on which he makes a

supply for consideration.

(2) Paragraph (a) of sub-article (1) does not apply to a person

who is treated as a taxable person only by reason of the fact that he

makes, from time to time, an intra-community supply of new means

of transport.

(3) A taxable person established in Malta who is not registered

under this article shall, if so requested by the Commissioner, apply

to be registered under this article within thirty days from the date

on which he is served with a notice containing such a request.

(4) A taxable person who is not established in Malta, who is

not registered in accordance with this article and who makes a

taxable or exempt with credit supply taking place in Malta on which he

would be liable for the payment of the tax on the said supply in

accordance with article 20 had that supply been a taxable supply, shall

apply to be registered in accordance with this article by not later

than thirty (30) days from the date of that supply

Provided that such person shall be relieved of the obligation

to be registered in accordance with this sub-article when such

person notifies the Commissioner that any of the special schemes

provided for in accordance with Chapter 6 of Title XII of Council

Directive 2006/112/EC shall be used to declare and pay the tax

which such person is liable to pay, in line with the provisions of the

respective special scheme, by not later than ten (10) days from the

date of such supply

Provided further that a taxable person who is not established in

Malta but is established in another Member State shall be relieved of

the obligation to be registered in accordance with this sub-article when

the Commissioner is notified, and approves, the use by such person of

the special scheme for small enterprises provided for in accordance

with Chapter 1 of Title XII of Council Directive 2006/112/EC.

(5) Any person who is not a person registered under this article

and who carries on or intends to carry on an economic activity may

apply to be registered under this article.

(6)

The Commissioner shall register under this article

(a) every person who in his opinion is liable to apply for

registration in terms of sub-articles (1), (3) or (4);

(b) any person who has made an application in terms of

sub-article (5) if the Commissioner is satisfied that

that person carries on or intends to carry on an

economic activity and -

(i)

is likely to be entitled, if he becomes so

registered, to claim input tax credits under the

provisions of article 22; or

(ii) has made or is likely to make an intra-

community acquisition in Malta for the purpose

of operations carried out outside Malta;

(c) any person whose registration under article 11 is

cancelled in accordance with sub-articles (6), (7) or (8)

thereof, in cases where such person would be liable to

apply for registration under this article;

(d) any person whose registration under article 11B is

cancelled in accordance with sub-article (3) thereof, in

cases where such person would be liable to apply for

registration under this article.

(7)

(Deleted by Act V. 2012.59).

(7a) A registration in accordance with paragraphs (a) and (d) of sub-

article (6) shall take effect as from the date the taxable person should

have been registered under this article. A registration in accordance

with paragraph (c) of sub-article (6) shall take effect as from the date

the registration under article 11 is cancelled. A registration in

accordance with paragraph (b) of sub-article (6) shall take effect as

from the date such person applies to be registered under this article.

(8) Without prejudice to article 11(3), the Commissioner may

at any time cancel the registration of a person under this article if

he has reason to believe that that person would not, if he were not

so registered, be required to apply for registration or entitled to be

registered under this article.

(9) Nothing in this article shall prevent or shall be deemed to

prevent the Commissioner from enforcing any of the provisions of

Council Regulation (EU) No. 904/2010.

(10) A person registered under this article who ceases to be

required or entitled to be registered under this article, if he were not so

registered, shall within fifteen (15) days from the occurrence of this

event apply with the Commissioner to cancel his registration under

this article.

Substituted by

X. 2003.47.

[Article 46]

Amended by

L.N. 426 of 2007;

Appeals to the Administrative Review Tribunal

L.N. 105 of 2008;

II. 2009.56.

Substituted by

L.N. 89 of 2012;

L.N. 185 of 2012.

Amended by

L.N. 64 of 2013.

Competence of the Tribunal

1. (1) The Tribunal shall be competent to hear any appeal against an

assessment and to confirm, reduce or increase any taxable value or credit or tax

assessed by the Commissioner, or cancel the assessment or make such other

declaration or order as it deems fit.

(2) The Tribunal shall be competent to determine any matter referred to it in

accordance with article 44.

(3) The Tribunal may, in any decision, make such order on the costs of the case

as it may deem appropriate.

Appeals against assessments

2. (1)

An appeal against an assessment shall not be valid if

(a) a return for the tax period to which the assessment refers has not been

delivered to the Commissioner before the appeal is entered;

(b) all tax payable by the appellant which is not in dispute has not been paid;

(c) it is not made within thirty days from the date of the service of the notice

against which the appeal is made;

(d) it is not made in such form and in such manner as may be prescribed under

the Administrative Justice Act;

(e) a payment of such fees for lodging an appeal as may be prescribed under

the Administrative Justice Act has not been made.

(2) The onus of proving that any taxable value assessed by the Commissioner is

excessive or that any credit assessed by the Commissioner is insufficient shall lie on

the appellant.

(3) The Tribunal may refuse to consider any evidence as sufficient for the

purpose of paragraph (2) if the appellant has failed to keep the records and

documents required to be kept by this Act or fails to produce such records or

documents.

(4) The Tribunal shall deliver its decision in writing and shall cause a copy of

the decision to be given to the appellant.

Evidence and proof

3. For the purpose of -

(a) the examination of evidence and enforcing the attendance of witnesses;

(b) the production of books and other documentary evidence,

in any appeal to the Tribunal, the Tribunal shall also have all such powers as are

vested by the Code of Organization and Civil Procedure in the Civil Court, First Hall

and it shall, mutatis mutandis, be regulated by the appropriate rules set out

Provided that -

(i)

the clerk, agent, employee or other person confidentially

employed in the affairs of the appellant, and the parents, spouse

or children of such appellant, shall not be called to give evidence

or to be examined except on the request of the appellant;

(ii) any person, other than the Commissioner, who has or has had any

official duty, or is or has been employed, in the administration of

the Act, shall not be called to give evidence or to be examined in

connection with any official matter concerning the assessment

under appeal except on the request of the Commissioner.

Payment of the tax

4. (1) When a valid appeal has been made against an assessment, the payment

of so much of the tax assessed which is in dispute may be kept in abeyance until the

appeal is finally determined, provided that the running of interest on the said tax

shall not be meanwhile suspended.

(2) The running of the period referred to in article 58(2) shall be suspended in

respect of any tax or administrative penalty for any time during which the payment

thereof may be kept in abeyance in terms of this item.

(3) Where the tax payable as a result of a decision of the Tribunal on an appeal

against an assessment exceeds the tax shown to be payable in the said assessment,

the excess shall be payable by not later than the end of the month during which the

said decision is served on the appellant and interest at the rate specified in article

21(4) shall be due on such excess from the said date for any period during which

such excess remains unpaid.

References to the Tribunal

5. (1) A reference to the Tribunal of any matter referred to in article 44 may

not be made unless it has first been raised in correspondence with the Commissioner

and shall be made by means of an application in writing which shall state clearly all

the facts relevant to that matter and the manner in which, in the opinion of the

applicant, that matter should be determined.

(2) A reference to the Tribunal on a question referred to in article 44(k) (the

imposition of an administrative penalty) shall not be valid unless it is made by not

later than two years from the date on which a notice of the imposition of the

administrative penalty in question was given to the person on whom it was imposed.

(3) The Tribunal shall, after hearing all parties having an interest in the matter,

and obtaining all relevant information, decide the matter and cause its decision to be

served on the parties.

Appeals against Assessments

6. (1) An appeal against an assessment shall be made by an application which

shall be signed by the appellant or by his agent.

(2)

An application to the Tribunal under paragraph (1) shall be drawn up and

filed with the Secretary in duplicate, and the Secretary shall cause one copy to be

delivered to the Commissioner within five working days from the date it is so filed.

(3) The Tribunal may, at any time, allow any amendment to be made in any

application for the purpose of making it clearer.

Reply by the Commissioner

7. When a copy of an application of an appeal against an assessment has been

delivered to the Commissioner in accordance with paragraph (2) of item 5 above, the

Commissioner shall, within twenty days from the expiration of the time limit laid

down in the said paragraph, file with the Secretary a reply in duplicate stating his

reasons for contesting the appeal, and the Secretary shall cause one copy of the reply

to be served on the appellant.

Reference to the Tribunal

8. (1) An appeal to the Tribunal consisting of a reference of a question to the

Tribunal made by a person other than the Comm issioner shall be made by

application which shall be signed by the appellant or by his agent.

(2) An application to the Tribunal under paragraph (1) shall be drawn up and

filed with the Secretary in duplicate, and the Secretary shall cause one copy to be

delivered to the Commissioner within five working days from the date it is so filed.

(3) When a copy of an application under paragraph (1) has been delivered to the

Commissioner in accordance with paragraph (2), the Commissioner shall within

twenty days from the expiration of the time limit laid down in the said paragraph,

file with the Secretary a reply in duplicate stating his reasons for contesting the

appeal and the Secretary shall cause one copy of the reply to be served on the

appellant.

(4) The Tribunal shall refrain from deciding on an appeal referred to in

paragraph (1) unless the appellant shows that he had, before making his application,

referred the matter to the Commissioner in writing and that

(a) the Commissioner agreed that the question should be referred to the

Tribunal,

(b) the Commissioner did not give a reply, or

(c) the appellant feels aggrieved by the Commissioner’s reply.

(5) An appeal to the Tribunal consisting of a reference of a question to the

Tribunal made by the Commissioner shall be made by an application which shall

indicate the name of a person or the names of persons who, in his opinion, has or

have a direct interest in the matter.

Parties to a reference

9. (1) The parties to an appeal consisting of a reference of a question to the

Tribunal shall be

(a) the Commissioner;

(b) where the appellant is not the Commissioner, the appellant, provided

that the Tribunal may at any time, and at the request of the

Commissioner, require the appellant to prove his direct interest in the

matter;

(c) any person indicated in an application made by the Commissioner in

accordance with paragraph (3) of item 7.

(2) A decision of the Tribunal shall be binding, with respect to the specific

matter referred to it, on the parties to the appeal but not on any other person

Provided that the decision shall be binding as aforesaid only if the relevant

facts have been correctly stated in the application or otherwise recorded in the

records of the case and shall remain binding only as long as there have been no

material changes to the said facts or to the relevant provisions of the law.

Appointment of date for hearing of reference to the Tribunal

10. (1) After an application has been made in accordance with item 7, the

Tribunal shall appoint a day for the hearing of the appeal.

(2) The Secretary shall cause a notice of the day and time appointed for the

hearing of the appeal to be served on all parties to the appeal. He shall, moreover,

cause a copy of the application to be served on the parties to the appeal, except for

the appellant himself.

11. The provisions of article 15 of the Administrative Justice Act shall apply to

any appeal or reference made to the Tribunal.

Substituted by

X. 2003.47.

[Articles 22 and 23]

Amended by

L.N. 426 of 2007;

Deductions

L.N. 105 of 2008;

L.N. 86 of 2009;

L.N. 535 of 2010;

L.N. 382 of 2011;

L.N. 421 of 2012;

L.N. 231 of 2015.

Eligibility for credit for input tax

1. Except as the Commissioner may otherwise allow no credit for input tax for

a tax period shall be allowed to a person unless a claim is made in accordance with

any relevant provision of this Act.

Evidence of input tax

2. (1) No amount shall be treated as input tax of a person unless that person

proves that the tax was chargeable on supplies of goods and services or intra-

community acquisitions or importations of goods which have been or which will be

used by him in the course or furtherance of his economic activity.

(2) Except as the Commissioner may otherwise allow, no amount shall be

treated as input tax of a person unless

(a) it is supported by -

(i)

a tax invoice in respect of the tax relating to goods or services

supplied to him; or

(ii) a tax invoice in respect of the tax relating to goods acquired by

him under an intra-community acquisition; or

(iii) a document of importation indicating him as the importer in

respect of the tax on an importation; and

(b) with respect to any tax on a supply which in terms of this Act is payable

by that person or on an intra-community acquisition, he has reported

that tax as due by him in his tax return; and

(c) the document referred to in paragraph (a) is held by that person and

produced, if requested, to the Commissioner; and

(d) the amount of the tax is properly accounted for in the records held by

that person to the extent required for the purposes of the Act.

Tax which is not to be treated as input tax

3. (1) Subject to paragraph (2) of this item, no amount shall be treated as input

tax of a person to the extent to which it represents tax chargeable on

(a) the supply to that person or the intra-community acquisition or

importation by that person of

(i)

tobacco or tobacco products;

(ii)

alcoholic beverages;

(iii)

works of art, collectors’ items and antiques;

(iv)

motor vehicles, vessels or aircraft including the supply thereof for

hire or leasing arrangements;

(v)

goods and services for the purpose of repairing, maintaining,

fuelling and keeping any item to which item (iv) of this

subparagraph applies;

(b) the supply of any goods and services or the intra-community acquisition

or importation of any goods used in the provision by that person of

receptions, entertainment or hospitality except where the said provision

is made for consideration in the normal course of that person’s

economic activity;

(c) the supply of any goods and services or the intra-community acquisition

or importation of any goods used in the provision by that person to his

employees or, in the case of a body of persons, to its officers or

employees, of transport or entertainment: provided that this provision

shall not apply to transport provided by that person to his employees on

vehicles with a seating capacity of not less than seven.

(2) The provisions of sub-paragraphs (i) to (v) of paragraph (1)(a) shall not

(a) goods supplied to or acquired under an intra-community acquisition or

imported by a person for the purpose of resale, whether in the state in

which they were acquired or imported or after treatment or processing

or inclusion in other goods supplied by that person, in the normal course

of that person’s economic activity;

(b) motor vehicles, vessels or aircraft supplied to or acquired under an

intra-community acquisition or imported by a person and used by him

for the purpose of the carriage of goods or passengers for a

consideration;

(c) vessels and aircraft supplied to or acquired under an intra-community

acquisition or imported by a person for the purpose of being provided

by him under a charter or hire agreement;

(d) motor vehicles supplied to or acquired under an intra-community

acquisition or imported by a person for the purpose of being provided

by him for hire with a driver or for self-drive hire (excluding fuelling

for such self-drive vehicles), or of being used for driving instructions,

provided they are so used, in each case, in the normal course of that

person’s economic activity;

(e) motor vehicles designed and manufactured for the carriage of goods and

so designed and manufactured with seating accommodation normally

adjacent to the driver or with seating accommodation for nine persons

or more;

(f)

vessels or aircraft used for the carriage of goods or personnel in the course

of an economic activity or where the use of such vessels or aircraft

constitutes a specific and essential element for the performance of the

economic activity which would otherwise give rise to a right of deduction

in terms of article 22.

(3) In this item, "works of art, collectors items and antiques" shall have the

meaning assigned to it by Part B of the Fourteenth Schedule.

(4) Tax paid or payable on any supply to or on any intra-community acquisition

or importation by a person in the name and for the account of another person in

respect of disbursements that, in terms of the Seventh Schedule, do not form part of

the taxable value of supplies made to that other person shall not be treated as input

tax of the first mentioned person.

Tax partially treated as input tax

4. (1) Where any goods or services are or will be used but not wholly used in

the course or furtherance of an economic activity, there shall be treated as input tax

such proportion of the tax chargeable on the supplies, intra-community acquisitions

or importations in question, taking into account the proportion of the use of those

goods or services in the course or furtherance of the economic activity to their total

use.

(2) In the case of immovable property forming part of the business assets of a

taxable person and used both for purposes of the taxable person’s business and for

his private use or that of his staff, or, more generally, for purposes other than those

of his business, VAT on expenditure related to this property shall be deductible in

accordance with the principles set out in this Schedule only up to the proportion of

the property’s use for purposes of the taxable person’s business which give him the

right to deduct.

By way of derogation from item 15 of the Second Schedule, changes in the

proportion of use of immovable property referred to in paragraph (1) shall be taken

into account in accordance with the principles provided for in item 7 of this

Schedule.

(3) The provisions of paragraph (2) shall also apply in relation to VAT on

expenditure related to capital goods other than immovable property forming part of

the business assets of a taxable person.

For the purpose of this paragraph "capital goods" shall have the meaning

assigned to it in the Value Added Tax (Adjustments relating to Input Tax on Capital

Goods) Regulations (S.L.406.12).

Attribution of input tax

5. (1) Any input tax of a person registered under article 10 for a tax period

which is exclusively attributable to supplies to which article 22(4) applies shall be

allowed as a credit for that period.

(2) Any input tax which is exclusively attributable to supplies other than those

referred to in paragraph (1) shall not be allowed as a credit.

(3) Any input tax for a tax period which is attributable both to supplies to which

article 22(4) applies and also to other supplies shall be partially allowed as a credit

for that tax period, which portion shall be determined in accordance with item 6 or 8.

Partial attribution

6. (1) The portion of input tax allowable as a credit to a person in terms of item

5(3) shall be calculated as follows

(a) the total value of supplies to which article 22(4) applies made by that

person during all the tax periods ending during a calendar year is

divided by the total value of supplies made by that person during those

tax periods;

(b) the result obtained under paragraph (a) shall be the definitive ratio for

the year referred to in that paragraph and the provisional ratio for the

following year;

(c) the input tax credit of that person for each tax period ending during a

calendar year shall be calculated provisionally by multiplying the value

of the input tax of that person for that tax period by the provisional ratio

for that year;

(d) the total input tax credit of that person for all the tax periods ending

during a calendar year shall be calculated definitively by multiplying

the total input tax for those periods by the definitive ratio for that year;

(e) the difference between the total input tax for the tax periods ending

during a year calculated provisionally under paragraph (c) and the

definitive calculation for that year under paragraph (d) shall represent

tax due by that person or a deduction allowable to that person, as the

case may be, which tax or deduction shall be accounted for in the tax

return for the first tax period that ends in the year following that for

which the provisional calculation was made: provided that the tax or

deduction in respect of a year during which the registration of a person

under article 10 is cancelled shall be accounted for in his last tax period.

(2)

For the purposes of paragraph (1)

(a) the value of supplies not subject to tax under this Act shall be

determined in the manner applicable for the determination of the taxable

value of taxable supplies;

(b) there shall be excluded from the value of the supplies made by that

person -

(i)

the value of any supply of capital goods used in his economic

activity;

(ii) the value of self-supplies;

(iii) the value of any supply which is not made by a taxable person

acting as such.

Adjustment relating to input tax on the acquisition of capital goods

7. (1) Where the input tax credit of a person ("the owner") for any tax period

during a calendar year ("the year of acquisition") includes tax on the supply to that

person or the intra-community acquisition or importation by that person of capital

goods, an adjustment should be made to the input tax already allowed, if the input

tax for any year during an adjustment period is allowable at a rate which is higher or

lower than that already allowed in the year of acquisition.

(2)

The Minister may by regulations

(a) define the capital goods to which this item applies;

(b) define the period or periods of adjustment applicable to capital goods;

(c) prescribe the method in which the adjustment shall be calculated and the

manner in which it shall be effected.

Alternative methods of partial attribution

8. Where it appears that the method of attributing input tax laid down in item 6

does not give a fair and reasonable result, the Commissioner may by notice in

writing to a registered person direct that the said method shall not apply to the

attribution of input tax to the supplies of that person and where such a direction has

been given, that person shall adopt such other method of partial attribution as the

Commissioner may, in the said notice, prescribe.

Rounding up

9. (1) A fraction resulting from any computation made in accordance with this

Schedule shall be rounded up to the nearest euro.

(2) Where the amount of input tax which results to be not allowable as a credit

for a tax period pursuant to an apportionment made in accordance with items 6 or 8

is less than €20 multiplied by the number of months or part thereof included in that

tax period that amount shall, notwithstanding the said provisions, be treated as

allowable as a credit for input tax.

Bad debt relief

10. (1) Where a person registered under article 10 of this Act shows to the

satisfaction of the Commissioner that an amount due to him as consideration for a

supply made to another person has, during a tax period, become a bad debt and that

output tax has been paid or is payable by the said person in respect of that supply,

that person may claim the amount of the output tax corresponding to the bad debt to

be allowed as a deduction by way of a bad debt relief in addition to any other

deduction allowable to him as an input tax credit in accordance with the other

provisions of this Schedule for that tax period or for such subsequent tax period as

the Commissioner may allow.

(2) A claim for a deduction by way of a bad debt relief shall be subject to such

directives as the Commissioner may give as to the circumstances in which it may be

made and the documents or other evidence that should be produced.

(3) The recovery of a bad debt in respect of which a deduction has been allowed

in terms of this item or of a part of such a debt shall, to the extent of the amount

recovered, be treated as a taxable supply taking place at the time when the said debt

or part thereof is recovered and shall be accounted for accordingly by the person to

whom the deduction had been so allowed.

Deductions on account of a reduction in the taxable value of supplies or intra-

community acquisitions

11. (1) Where, in terms of the Seventh Schedule, the taxable value of a supply

or an intra-community acquisition is reduced after that supply or acquisition takes

place any output tax corresponding to that reduction shall be allowable as a

deduction to the person by whom that output tax was paid or is payable for the tax

period during which the cause for the reduction occurs.

(2) The deduction allowable under this item is subject to the condition that the

person claiming it has properly accounted for the output tax on the taxable value in

question before the reduction.

(3) A claim for a deduction under this item shall be subject to such directives as

the Commissioner may give as to the documents or other evidence that should be

produced.

Saving provision

12. The provisions of this Schedule are without prejudice to the provisions of

the Fourteenth Schedule and, in particular, to the limitations provided for in that

Schedule to the right of input tax credit allowable in the case of supplies subject to a

margin scheme.

Input tax on supplies under cash accounting

13. Where a tax invoice indicates the words "Cash Accounting", the right of

deduction of input tax, if applicable, shall arise when the payment of the tax is made

to the supplier.

(1)

When a taxable person established in Malta who is

not registered under this article qualifies as a small enterprise in terms

of the provisions of Part One of the Sixth Schedule he may apply to the

Commissioner to be registered under this article.

(2)

The Commissioner shall register under this article any

person who has submitted an application under sub-article (1) if he is

satisfied that such person is eligible for such registration in accordance

with the provisions of Part One of the Sixth Schedule

Provided that such registration shall only take effect as from

the first day of the month in which the Commissioner receives the

application in accordance with sub-article (1) from a taxable person

w h o i s n ot r e g i s t e r e d u n d e r a r t i c l e 1 0, o r f r o m t he d a te o f

commencement of the economic activity of the taxable person,

whichever is the later

Provided further that such registration shall only take effect

as from the first day of the month following the month in which the

Commissioner receives the application under sub-article (1) from a

taxable person registered under article 10.

(3)

Any person registered under this article shall be subject to

the provisions of Part One of the Sixth Schedule.

(4)

When a person is, immediately before his registration under

this article, registered under article 10 the Commissioner shall, upon

the registration of such person under this article, cancel the registration

under article 10.

(5)

A person registered under this article

(a)

may, at any time, apply to the Commissioner for

the cancellation of his registration under this article;

(b)

shall, within fifteen (15) days from the date on

which such person no longer qualifies as a small enterprise in

terms of the relevant provisions of Part One of the Sixth

Schedule, apply to the Commissioner for the cancellation of the

said registration;

(c)

shall, within fifteen (15) days from the cessation

of his economic activity, apply to the Commissioner for the

cancellation of such registration.

(6)

When a taxable person submits an application for the

cancellation of his registration under this article pursuant to paragraph

(a) of sub-article (5), such cancellation shall apply with effect from the

first day of the following calendar month.

(7)

When a taxable person submits an application for the

cancellation of his registration under this article pursuant to paragraph

(b) of sub-article (5), such cancellation shall apply with effect from the

first day of the calendar month following the date on which such

taxable person no longer qualifies as a small enterprise.

(8)

Where the Commissioner has reason to believe that the

taxable person no longer qualifies as a small enterprise in terms of the

r e l e v a n t p r o v i s i o n s o f P a r t O n e of th e S i x th S c h e d u l e , th e

Commissioner shall cancel the registration of that taxable person

under this article with effect from the date that such taxable person no

longer qualifies as a small enterprise as may be determined by the

Commissioner

Provided that the Commissioner shall immediately upon the

cancellation of a registration under this article, register that person

under article 10 if, in the opinion of the Commissioner, such person is

liable to apply for registration in terms of the said article.

(9)

Without prejudice to sub-articles (6), (7) and (8), the

Commissioner may at any time cancel the registration of a person

under this article if he has reason to believe that such person does not

carry on or has ceased to carry on an economic activity or that it is not

likely that his economic activity shall include any activities other than

those exempt activities without credit supplies.

(10) Without prejudice to the other provisions of this article, a

taxable person registered under this article which carries out any of the

following transactions shall also be required to register under article

12 in accordance with the provisions thereof if such person

(a)

makes intra-Community acquisitions of goods

subject to VAT pursuant to article 4(b);

(b)

receives services for which he is liable to pay

VAT pursuant to article 20;

(c)

supplies of services within the territory of another

Member State for which VAT is payable solely by the recipient.

(1)

A taxable person established in Malta qualifying as a

small enterprise in terms of the provisions of Part Two of the Sixth

Schedule, who makes supplies of goods and services within the

territory of another Member State, and who intends to avail of the

exemption in terms of the special scheme for small enterprises

applicable in the respective Member State in which the supplies are

made in accordance with Chapter 1 of Title XII of Council Directive

2006/112/EC, may apply to the Commissioner to be registered under

this article.

(2)

The Commissioner shall register under this article any

person who has submitted an application under sub-article (1) if he is

satisfied that that person is eligible for such registration in accordance

with the provisions of Part Two of the Sixth Schedule

Provided that such registration shall only take effect as from

the date notified by the Commissioner to the taxable person.

(3)

Any person registered under this article shall be subject to

the provisions of Part Two of the Sixth Schedule.

(4)

A person registered under this article

(a)

may, at any time, apply to the Commissioner for

the cancellation of his registration under this article;

(b)

shall, within fifteen (15) working days from the

date on which such person is no longer eligible to avail of the

special scheme for small enterprises in terms of the provisions

of Part Two of the Sixth Schedule in any Member State, apply

to the Commissioner for an update or cancellation of such

registration, as the case may be;

(c)

shall, within fifteen (15) working days from the

date on which the Union annual turnover of that person referred

to in the Sixth Schedule exceeds the Union threshold referred to

in the same Schedule, apply to the Commissioner for the

cancellation of the said registration.

(5)

The Commissioner shall cancel the registration of a person

under this article with immediate effect

(a)

in cases where the Commissioner has reason to

believe that the taxable person is no longer eligible to avail of

the special scheme for small enterprises in terms of the

provisions of Part Two of the Sixth Schedule;

(b)

if such person notifies the Commissioner through

the established web portal designated for this purpose by the

Commissioner, that such person no longer intends to avail

himself of the special scheme for small enterprises in all

Member States, or whose Union annual turnover referred to in

the Sixth Schedule exceeded the Union threshold referred to in

the said Schedule;

(c)

if such person notifies the Commissioner through

the established web portal designated for this purpose by the

Commissioner, or it may otherwise be presumed by the

Commissioner, that the economic activity of such person has

ceased.

(1)

A taxable person who is not established in Malta but

is established in another Member State shall be deemed to have

applied to register under this article once the Commissioner is notified

by the Member State in which such person is established in accordance

with Chapter Xa of Council Regulation (EU) 904/2010 of the person’s

intention to avail itself of the exemption for small enterprises in

relation to supplies of goods and services made in Malta

Provided that the registration of such person under this

article shall only be deemed to be effective as from the date the

Commissioner notifies the Member State of establishment, through the

designated electronic means for this purpose, of his approval to

register the said person under this article in accordance with the

provisions of Part Three of the Sixth Schedule.

(2)

The Commissioner shall notify by electronic means the

Member State of establishment of his approval or otherwise in

accordance with sub-article (1) within fifteen (15) working days after

receiving the information referred to in Article 37a(1)(a) of Council

Regulation 904/2010.

(3)

The Commissioner may cancel the registration of a person

under this article with immediate effect where the Commissioner has

reason to believe that the taxable person is no longer eligible to avail

himself of the special scheme for small enterprises in terms of the

provisions of Part Three of the Sixth Schedule and notify the Member

State of establishment of such person without delay of the date on

which the said person has ceased to be eligible for the exemption for

small enterprises in relation to supplies of goods and services made in

Malta.

(4) The Commissioner may cancel the registration of a person

under this article with immediate effect where the Commissioner is

notified pursuant to Article 37a of Council Regulation (EU) No. 904/

2010 that the person intends to cease to apply the exemption for small

enterprises to supplies of goods and services in Malta, or is not eligible

to benefit from such an exemption.

Amended by

L.N. 60 of 1999;

[Article 48]

L.N. 200 of 1999;

L.N. 217 of 1999;

Tax records

L.N. 272 of 2000;

L.N. 93 of 2001;

L.N. 235 of 2001;

L.N. 389 of 2002.

Substituted by

X. 2003.47.

Amended by

L.N. 72 of 2010;

L.N. 422 of 2012;

L.N. 252 of 2019;

L.N. 224 of 2020;

L.N. 347 of 2024.

Records to be kept by persons registered under article 10

1. (1) Every person registered under article 10 shall keep the following records

and documents

(a) proper accounts and records of his economic activity;

(b) a value added tax account;

(c) an annual value added tax account;

(d) copies of all tax invoices issued by him;

(e) all tax invoices received by him;

(f)

documentation relating to customs and, where applicable, excise

procedures with respect to importation and exportation of goods by him;

(g) copies of all fiscal receipts issued by him in terms of the Thirteenth

Schedule to this Act;

(h) all credit notes, debit notes and other documents issued by him or

received by him which evidence an increase or a decrease in the

consideration for any supplies, intra-community acquisitions or

importations;

(i)

a register of goods transported by him or on his behalf out of Malta but

within the Community for the purpose of transactions referred to in item

17 of the Second Schedule (Transfer of goods to another Member State),

showing

-

a description of the goods;

-

their quantity;

-

their value;

-

their movements;

-

a description and the quantity of the goods not transported back;

and

-

the date and the reference to the documents issued, if any, relating

to these operations;

(j)

a record of movable tangible goods transported to him from another

Member State by or on behalf of a taxable person identified for

purposes of value added tax in that other State for the purpose of the

valuation of or works on those goods showing

-

a sequential number;

-

the date of receipt of the goods;

-

the name and address of the customer;

-

the value added tax identification number of the customer;

-

the quantity of the goods received;

-

a description of the goods received;

-

the date of the transport of the processed goods after valuation to

the customer;

-

the quantity and the description of the goods that are not

transported back to the client;

-

the date and a reference to the documents issued relating to the

services supplied;

(k) (i) a register of goods transferred under the call-off stock arrangements

referred to in item 17A of the Second Schedule that permits the

Commissioner to verify the correct application of the rules in terms of

the provisions of the said item 17A of the Second Schedule; and

(ii)

a register of those goods supplied to him under the call-off stock

arrangements referred to in item 17A of the Second Schedule.

(2) Invoices shall be stored in the original form in which they were sent or made

available, whether paper or electronic. Additionally, in the case of invoices stored by

electronic means, the Commissioner may require that the data guaranteeing the

authenticity of the origin of the invoices and the integrity of their content as

provided for in the Twelfth Schedule shall also be stored by electronic means.

(3) Where a taxable person stores by electronic means invoices or fiscal receipts

which he issues or receives, such person shall ensure the possibility for online

access, download and use of the data concerned to the Commissioner

Provided that where any invoices relate to VAT due in another Member State,

the competent authorities of such Member State shall, for control purposes, have the

right to access, download and use those invoices.

Matters to be included in the accounts

2. The accounts of the economic activity of every person registered under

article 10 shall be kept in such a way as to enable the following matters to be readily

ascertained

(a) the total value, exclusive of tax, of the supplies made by him during

each tax period;

(b) the total value, exclusive of tax claimed as input tax credit, of his inputs

for each tax period;

(c) the output tax and any other tax payable by that person for each tax

period;

(d) the input tax credits, the deductions, the excess tax credit and the tax

refundable, for each tax period;

(e) the calculation, where input tax credit is allowable under a partial

attribution method, of the provisional input tax credit for each tax

period, of the definitive input tax credit for each year and of the

adjustments to the input tax credit;

(f)

sub-totals, breakdowns and notes to the accounts as are necessary to

readily identify the source of the information shown in the value added

tax account.

The value added tax account

3. (1) The value added tax account shall be a separate account held for each

tax period of the taxable person and shall contain all the information, including all

the totals, sub-totals and breakdowns, required to be furnished in the tax return for

that period.

(2) The value added tax account shall contain a cross reference to the matters

referred to in item 2 that enables the matching and reconciliation of all information

contained therein.

Correction of mistakes by means of an adjustment in a subsequent tax return

4. (1) Where a person registered under article 10, in a return for a tax period

furnished to the Commissioner -

(a) overstates or understates the output tax and the overstatement or

understatement does not exceed five per cent of the output tax declared

in the said return, and/or

(b) overstates or understates the credit for input tax and the overstatement

or understatement does not exceed five per cent of the credit for input

tax declared in the said return,

he may correct the mistake by making the necessary entries in the value added tax

account and in the tax return for the tax period during which the overstatement or

understatement is discovered.

(2) No correction may be made in accordance with this item for any tax period

which commences later than six months from the expiration of the tax period to

which the mistake refers.

(3)

When a correction is made in terms of this item the value added tax account

shall contain a clear reference to the tax period to which the mistake refers and to all

the documents relating to relative transactions.

(4) A mistake in a tax return may not be corrected by means of a correction in a

subsequent tax return except to the extent allowed and in the manner provided in this

item.

Annual value added tax account

5. The annual value added tax account shall be an account drawn up for every

calendar year and shall show the totals of all values entered in the value added tax

account for each of the tax periods ending during that calendar year.

Exceptions

6. (1) The Commissioner may, in any particular case or classes of cases,

require such additional records or documents to be kept, or allow such variations to

the records and documents to be kept in accordance with this Schedule as he may

deem appropriate for any of the purposes of the Act.

(2) This Schedule shall be subject to the general requirements of article 48 and

without prejudice to any additional records and accounts that may be required under

any special provision contained in the Act or in any regulations made under the Act.

Records of intra-community acquisitions

7. Every taxable person who is not registered under article 10 and every non-

taxable legal person shall keep records in sufficient detail as to enable the

determination of the value of intra-community acquisitions made by him in Malta

including

(a) a description of the goods and the consideration paid on each

acquisition;

(b) the relative invoices;

(c) all other information relevant for the purposes of determining the value

of intra-community acquisitions for the purposes of Part Two of the

Sixth Schedule;

(d) all other supporting documents.

Records of distance sales and supplies facilitated through the use of an electronic

interface

8. (1) Every taxable person shall keep records in sufficient detail as to enable

the determination of the value of distance sales made by him of goods transported

from Malta including

(a) a description of the goods and the consideration charged on each sale;

(b) a copy of the relative invoices;

(c) all other supporting documents.

(2) (a) Where a taxable person facilitates, through the use of an electronic

interface such as a market place, platform, portal or similar means, the supply of

goods or services to a non-taxable person within the Community in accordance with

the provisions of the Third Schedule, the taxable person who facilitates the supply

shall be obliged to keep records of those supplies. Those records shall be sufficiently

detailed to enable the tax authorities of the Member States where those supplies are

taxable to verify that VAT has been accounted for correctly.

(b) The records referred to in paragraph (a) must be made available

electronically on request to the Member States concerned. Those records shall be

kept for a period of ten (10) years from the end of the year during which the

transaction was carried out.

Records pursuant to tax payable as per article 20(2).

9. Every taxable person who is not registered under article 10 and every non-

taxable legal person identified for VAT purposes shall keep records in sufficient

detail as to enable the determination of the value of the purchases made by him in

Malta pursuant to article 20(2) including

(a) a description of the services and/or goods and the consideration paid;

(b) the relative invoices;

(c) all other supporting documents.

Records to be kept by persons registered under articles 11 and 11A

10. (1) Every person registered under articles 11 and 11A shall keep the

following records and documents

(a)

proper accounts and records of his economic activity;

(b)

copies of all fiscal receipts issued by him in terms of the Thirteenth

Schedule;

(c)

all fiscal receipts and tax invoices received by him;

(d)

all credit notes, debit notes and other documents issued by him or

received by him which evidence an increase or a decrease in the consideration for

any supplies, intra-community acquisitions or importations; and

(e)

any other documentation issued to customers in relation to supplies

made by him.

(2)

Invoices and fiscal receipts shall be stored in the original form in which

they were sent or made available, whether paper or electronic. Additionally, in the case

of invoices stored by electronic means, the Commissioner may require that the data

guaranteeing the authenticity of the origin of the invoices and the integrity of their

content as provided for in the Act shall also be stored by electronic means.

(3)

Where a taxable person stores by electronic means invoices or fiscal

receipts which he issues or receives, such person shall ensure the possibility for online

access, download and use of the data concerned to the Commissioner

Provided that where any invoices relate to VAT due in another Member

State, the competent authorities of such Member State shall, for control purposes, have

the right to access, download and use those invoices.

(4)

The accounts and records of the economic activity of every person

registered under articles 11 and 11A shall be kept in such a mannar as to enable the

following matters to be readily ascertained

(a)

the total value, exclusive of tax, of the supplies made to, and by him

during each tax period; and

(b)

the output tax and any other tax payable by such person for each tax

period, as may be applicable.

(1) When a taxable person who is not registered under

article 10 or a non-taxable legal person intends to make an intra-

community acquisition in Malta and, on account of that acquisition,

the value of his intra-community acquisitions in Malta during the

calendar year in which he makes that acquisition exceeds the

acquisitions threshold he shall apply to be registered under this

article, unless he is already so registered, by not later than the date

of that acquisition.

(2) For the purpose of sub-article (1), a taxable person who is not

registered or liable to be registered under article 10 or a non-taxable

legal person may, unless he is registered under this article, at any

time apply to be registered under this article.

(3)

A taxable person established in Malta, other than a taxable

person registered under article 10, who receives services for which he

is liable to pay the tax pursuant to article 20(2), shall apply to be

registered under this article by not later than the date on which he

receives a service.

(3a) A taxable person established in Malta, other than a taxable

person registered under article 10, who supplies services within the

territory of another Member State for which VAT is payable solely by

the recipient of the service pursuant to Article 196 of Council

Directive 2006/112/EC, shall apply to be registered under this article

by not later than the date on which he supplies such service.

(4) The Commissioner shall register under this article any person

who in his opinion is liable to apply for such registration in terms of

sub-articles (1), (3) or (3a) or who submits an application for

registration when he is so entitled in terms of sub-article (2).

(5) When a person is liable to apply for registration in terms of

sub-article (1) on account of an intra-community acquisition, the

registration of that person under this article shall be deemed to be

effective as from the date of that acquisition.

(6) A person registered under this article in the circumstances

mentioned in sub-article (1) may apply for the cancellation of his

registration at any time after the expiration of the calendar year

following that in which he was so registered if the value of his

intra-community acquisitions has not exceeded the acquisitions

threshold in the year in which he makes such an application or in

the preceding calendar year.

(7) A person registered under this article upon an application in

accordance with sub-article (2) may apply for the cancellation of

his registration at any time after the expiration of two consecutive

calendar years following the year in which he was so registered if

the value of his intra-community acquisitions has not exceeded the

acquisitions threshold in the year in which he makes such an

application or in the preceding calendar year.

(8) A person registered under this article in the circumstances

mentioned in sub-article (3) may apply for the cancellation of his

registration at any time if he no longer receives supplies of services for

which he is liable to pay the tax pursuant to article 20(2).

(8a) A person registered under this article in the circumstances

mentioned in sub-article (3a) may apply for the cancellation of his

registration at any time if he no longer supplies services for which the

recipient is liable to pay VAT.

(9) The value of intra-Community acquisitions for the purpose of

this article shall be determined in accordance with Part Three of the

Third Schedule.

(10) The Commissioner shall cancel the registration of a person

under this article -

(a) if that person is registered under article 10, in which

case the cancellation shall take effect from the

effective date of the said registration

Provided that if that person ceases to be registered

under article 10 on a date when he would not have

been entitled to apply for the cancellation of his

registration under this article had he remained

registered under this article, the Commissioner shall,

on that date, register that person again under this

article; or

(b) if such person is entitled to have his registration under

this article cancelled and applies for such a cancellation

in accordance with sub-article (6) or (7) or (8) or (8a), in

which case the cancellation shall take effect on 1st

January of the year in which the application is made.

Substituted by

X. 2003.47.

[Article 50(5)]

Amended by

L.N. 171 of 2006;

Tax invoice

L.N. 426 of 2007;

L.N. 448 of 2007;

L.N. 444 of 2010;

L.N. 423 of 2012;

L.N. 141 of 2013;

L.N. 298 of 2018;

L.N. 225 of 2020;

L.N. 348 of 2024;

III.2026.72.

Form of tax invoice

1. (1)

A document shall not constitute a tax invoice unless

(i)

all the particulars required by this Schedule are properly and fully

stated; or

(ii) the invoicing requirements set out in Directive 2006/112/EC are

fully complied with.

(2) Any document or message that amends and refers specifically and

unambiguously to the initial invoice shall be treated as an invoice.

(3) A simplified invoice shall be considered as a tax invoice in any of the

following cases

(a)

where the amount of the invoice inclusive of the tax is not higher

than one hundred euro (€100);

(b)

where the invoice issued is a document or message treated as an

invoice pursuant to sub-item (2);

(c)

where the taxable person is benefitting from the exemption for small

enterprises provided for under item 16 of Part Two of the Fifth Schedule

Provided that the provisions of this sub-item shall not apply where invoices are

required to be issued in case of cross-border supplies or where the taxable supply of

goods or services is carried out by a taxable person who is not established in the Member

State in which the tax is due or whose establishment in such Member State does not

intervene in the supply within the meaning of the proviso to article 20(2), and the person

liable for the payment of the tax is the person to whom the goods or services are

supplied.

(4)

For the purposes of this Schedule

"electronic invoice" means an invoice that contains the information required in

this Schedule, and which has been issued and received in any electronic format.

Issuance of tax invoice

2.(1) (a) A tax invoice shall be issued by not later than the fifteenth day of the

month following that in which the chargeable event occurs or the date on

which a payment is received, whichever is the earlier.

(b) Sub-paragraph (a) shall not apply to any payment on account which

precedes an intra-Community supply of goods.

(c) A tax invoice shall not be required in respect of a distance sale made by a

person who is making use of the special scheme in Section 3 of Part Seven

of the Fourteenth Schedule.

(2) (a) Invoicing shall be subject to the rules applying in the Member State in

which the supply of goods or services is deemed to be made, in accordance with the

provisions of the Third Schedule.

(b) By way of derogation from sub-paragraph (a), invoicing shall be subject to

the following rules

(i)

the rules applying in the Member State in which the supplier has

established his business or has a fixed establishment from which the

supply is made or, in the absence of such place of establishment or fixed

establishment, the Member State where the supplier has his permanent

address or usually resides, where

the supplier is not established in the Member State in which the

supply of goods or services is deemed to be made, in accordance

with the provisions of the Third Schedule, or his establishment in

that Member State does not intervene in the supply within the

meaning of the proviso to article 20(2) of the Act, and the person

liable for the payment of the VAT is the person to whom the goods

or services are supplied unless the customer issues the invoice

(self-billing);

the supply of goods or services is deemed not to be made within

the Community, in accordance with the provisions of the Third

Schedule;

(ii) the rules applying in the Member State where the supplier making use of

one of the special schemes referred to Part Seven of the Fourteenth

Schedule is identified.

(3) A summary invoice may be issued to detail several supplies of goods or

services provided that the tax on the supplies mentioned in the summary invoice

becomes chargeable during the same calendar month.

(4) Tax invoices may be drawn up by the customer in respect of supplies of

goods or services made to him by a taxable person where there is a prior agreement

between the two parties and provided that a procedure exists for the acceptance of

each tax invoice by the taxable person supplying the goods or services. The

Commissioner may require that such invoices be issued in the name and on behalf of

the taxable person.

Contents of a tax invoice

3. Saving the other provisions of this Schedule, a tax invoice shall contain the

following particulars

(a) the date of issue;

(b) a sequential number, based on one or more series, which uniquely

identifies the invoice;

(c) the name and address of the supplier and the Value Added Tax

identification number under which he made the supply;

(d) the name and address of the person to whom the supply is made and the

Value Added Tax identification number under which the customer

acquired the goods or services supplied to him;

(e) the quantity and nature of the goods supplied or the extent and nature of

the services rendered;

(f)

the date on which the supply was made or completed or the date on

which a payment on account of the supply was made insofar as that date

can be determined and differs from the date of issue of the invoice;

(g) the taxable value per rate or exemption, the unit price exclusive of tax

and any discounts or rebates if they are not included in the unit price;

(h) the VAT rate applied;

(i)

the VAT amount payable, except where a special arrangement is applied

under which, in accordance with this Act, such a detail is excluded;

(j)

where the person liable for payment of VAT is a tax representative in

another Member State, the VAT identification number of that tax

representative, together with his full name and address;

(k) where the VAT becomes chargeable at the time when the payment is

received in accordance with Part One of the Fourteenth Schedule, the

mention "Cash accounting";

(l)

where the customer receiving a supply issues the invoice instead of the

supplier, the mention "Selfbilling";

(m) where a tax invoice refers to supplies on which no tax is chargeable, it

shall indicate a brief reference to the relevant provisions of this Act, or

the appropriate provisions of Council Directive 2006/112/EC, or any

other indication on the grounds of which no tax is chargeable, and may

distinguish between

(i) supplies made outside Malta;

(ii) exempt with credit supplies;

(iii) exempt without credit supplies;

(n) where the customer is liable for the payment of the VAT, the mention

"Reverse charge";

(o) where the margin scheme for travel agents is applied, the mention

"Margin scheme - Travel agents";

(p) where one of the special arrangements applicable to second-hand goods,

works of art, collectors’ items and antiques is applied, the mention

"Margin scheme - Second-hand goods"; "Margin scheme - Works of art"

or "Margin scheme - Collector’s items and antiques" respectively;

(q) where the invoice is issued by a taxable person, who is not established

in the Member State where the tax is due or whose establishment in that

Member State does not intervene in the supply within the meaning of

the proviso of article 20(2) of the Act, and who is making a supply of

goods or services to a customer who is liable for payment of VAT, the

taxable person may omit the details referred to in sub-paragraphs (g),

(h) and (i) of this item and instead indicate, by reference to the quantity

or extent of the goods or services supplied and their nature, the taxable

amount of those goods or services;

(r) in an invoice for the intra-Community supply of a new means of

transport the description of the goods supplied shall contain the

particulars referred to in the definition of "new means of transport"

under article 2 of the Act.

Categories of supplies

4. A tax invoice may also contain the type of the supply by reference to the

categories as follows

(a) a supply by sale;

(b) a supply of goods under a hire-purchase agreement or in terms of which

the ownership of the goods is deferred;

(c) a supply on hire;

(d) a supply under a contract of exchange;

(e) a supply consisting in the delivery of goods made from materials

provided by the customer;

(f)

a supply by sale on commission;

(g) a supply on sale or return or similar terms;

(h) an export;

(i)

any other supply.

Simplified invoice

5. A simplified invoice referred to in item 1(3) shall contain at least the

following particulars

(a) the date of issue;

(b) a sequential number, based on one or more series, which uniquely

identifies the invoice;

(c) the name, address and the Value Added Tax identification number of the

supplier;

(d) the Value Added Tax identification number of the person to whom the

supply is made;

(e) a description sufficient to identify the goods and services supplied;

(f)

the total amount of tax payable or the information needed to calculate it;

(g) where the invoice issued is a document or message treated as an invoice

pursuant to item 1(2), specific and unambiguous reference to that initial

invoice and the specific details which are being amended.

Electronic invoices

6. (1)

For the purposes of this Schedule

"authenticity of the origin" means the assurance of the identity of the supplier or

the issuer of the invoice;

"integrity of the content" means that the content required according to this

Schedule has not been altered.

(2) The use of an electronic invoice shall be subject to acceptance by the

recipient.

(3) The authenticity of the origin, the integrity of the content and the legibility

of an invoice, whether on paper or in electronic form, shall be ensured from the point

in time of issue until the end of the period for storage of the invoice.

Each taxable person shall determine the way to ensure the authenticity of the

origin, the integrity of the content and the legibility of the invoice. This may be

achieved by any business controls which create a reliable audit trail between an

invoice and a supply of goods or services.

(4) Other than by way of the type of business controls described in paragraph

(3), examples of technologies that ensure the authenticity of the origin and the

integrity of the content of an electronic invoice are those referred to in article 233 of

Council Directive 2006/112/EC.

(5) Where batches containing several electronic invoices are sent or made

available to the same recipient, the details common to the individual invoices may be

mentioned only once where, for each invoice, all the information is accessible.

Currency

7. The amounts which appear on the invoice may be expressed in any currency,

provided that the tax payable or to be adjusted under this Act is expressed in Euro,

using the conversion rate mechanism provided for in the Seventh Schedule.

Translation of invoices

8. For control purposes, and as regards invoices in respect of supplies of goods

or services supplied in Malta and invoices received by taxable persons established in

Malta, the Commissioner may, for certain taxable persons or certain cases, require

translation into Maltese or English.

(1)

An application for registration or for the cancellation

of a registration in accordance with this Part shall be submitted

electronically through the established web portal designated by the

Commissioner for this purpose and shall contain the information

requested therein.

(2)

The Commissioner shall allocate a registration number to

every person registered under articles 10, 11, 11A or 12 and shall

make, through the established web portal designated by the

Commissioner for this purpose, electronically available a registration

certificate to every such person containing the registration number, the

article under which the registration was made, the effective date of the

registration and such other particulars as the Commissioner may deem

appropriate. The Commissioner may change the registration number of

any person as he may consider necessary and shall notify the said

person of any such change.

(3)

A registration number allocated under articles 10 or 12 shall

have the prefix "MT" in accordance with ISO International Standard

3166 - alpha 2. A registration number allocated under article 11 shall

not have such a prefix and shall not be treated for any purposes of this

Act as a value added tax identification number.

(4)

A registration number allocated under article 11A shall be

the same registration number as that allocated to the person under

article 10 or 11 in accordance with sub-article (3) but with the suffix

"EX" added to it.

(5)

When the registration of a person under articles 10, 11, 11A

or 12 is cancelled, the Commissioner shall serve a notice on such

person indicating the effective date of the cancellation.

(6)

The cancellation of the registration of a person shall not

relieve that person from any liability incurred in accordance with this

Act by virtue of anything done before the date of the cancellation or

from the obligation to submit an application for a fresh registration in

any of the circumstances under which he is required to apply for

registration in terms of any provision of this Part.

(7)

A number of persons regarded as a single taxable person in

terms of article 5(6) shall be registered as one (1) person.

(8)

The Minister may by regulations exempt any person or class

of persons from any of the provisions of this Part and may by such

regulations make such an exemption subject to such conditions and

limitations as may be prescribed.

(9)

Any person registered under articles 10, 11, 11A or 12 shall,

within fifteen (15) days from the occurrence of any of the following

events, inform the Commissioner of such event electronically through

the established web portal designated by the said Commissioner for

this purpose and including any information requested therein

(a)

in cases where there is a change in circumstances

that affects the particulars declared in the application for his

registration under articles 10, 11, 11A or 12 or otherwise

furnished to the Commissioner in connection with his

registration or appearing in the registration certificate;

(b)

in cases where there is the cessation or transfer of

his economic activity or part thereof; or

(c)

such other event as may be prescribed by the

Commissioner.

Substituted by

X. 2003.47.

[Article 51]

Amended by

L.N. 234 of 2011;

Fiscal receipts

L.N. 65 of 2015;

L.N. 241 of 2021;

L.N. 349 of 2024;

III.2026.73.

Interpretation

1. In this Schedule, unless the context otherwise requires -

"fiscal cash register" means a cash register which conforms with the requirements

specified in item 13 of this Schedule;

"fiscal receipt" means a receipt or invoice issued on a form supplied or approved

in writing by the Commissioner or issued in a manner as may be approved by the

Commissioner and containing all the information and details required to be specified

thereon, or a receipt issued by means of a fiscal cash register, or by a fiscal taxi

meter;

"fiscal taxi meter" means a meter which conforms with the requirements specified in

item 14 of this Schedule.

Obligation to issue receipt

2. Subject to the other provisions of this Schedule, every person who makes a

supply shall, except where he is required to issue a tax invoice in respect of such

supply, issue a fiscal receipt in accordance with this Schedule for the consideration

paid to him for that supply and such fiscal receipt shall, unless issued before the

payment is made, be issued and delivered to the person who effects the payment or to

the person to whom the supply is made immediately after payment has been effected,

to the extent covered by such payment

Provided that in respect of a supply for which no consideration is paid but

which is deemed to have been made for a consideration in accordance with the

Second Schedule, the fiscal receipt shall be issued on the date of that supply

Provided further that the provisions of this item shall not apply to supplies

which are exempt without credit in accordance with Part Two of the Fifth Schedule

other than supplies referred to under item 16(1) of Part Two of the said Schedule.

Supplies under the One Stop Shop and the Import One Stop Shop

2A. Persons supplying goods or services under the One Stop Shop or the Import

One Stop Shop, in terms of Chapter 6 of Title XII of Council Directive 2006/112/EC

entering into force as from 1 st July 2021, shall not be required to issue fiscal receipts

in terms of this Schedule for such supplies of goods and services.

Supplies taking place outside Malta

2B. Without prejudice to the provisions of the Twelfth Schedule, persons who

supply goods or services which, in terms of the Third Schedule, take place outside

Malta shall not be required to issue fiscal receipts in terms of this Schedule for such

supplies.

Receipt issued by a fiscal cash register

3. (1) Subject to the provisions of items 4, 5, 6 and 7 of this Schedule, a fiscal

receipt issued by a person who is a retailer or whose business includes supplies of

food referred to in item 2 of Part Five of the Fifth Schedule to the Act shall be issued

by means of a fiscal cash register: provided that in respect of any supply made by

such person in any period during which he is unable, for a reasonable cause, to issue

a fiscal receipt by means of a fiscal cash register, he shall issue a fiscal receipt on a

form supplied by the Commissioner

Provided that, for the purpose of this paragraph, a retailer shall not include a

person involved in the delivery of pre-ordered goods.

(2) A fiscal receipt which is required to be issued for the provision of a taxi

service shall be issued by means of a fiscal taxi meter: provided that in respect of

any supply made by such person in any period during which he is unable, for a

reasonable cause, to issue a fiscal receipt by means of a fiscal taxi meter, he shall

issue a fiscal receipt on a form supplied by the Commissioner.

(3) For the purposes of paragraphs (1) and (2) of this item, the following shall

not be deemed to constitute a reasonable cause

(a) not being in possession of a fiscal cash register or a fiscal taxi meter;

(b) not being in possession of stationery or other material required for the

functions of the fiscal cash register or a fiscal taxi meter;

(c) defects in the functioning of a fiscal cash register or a fiscal taxi meter

except where prompt and reasonable measures have been taken to

remedy such defects.

Door to door sales of gas, milk or bread

4. (1) A person who makes supplies from a vehicle consisting in door-to-door

delivery, or in the delivery to the public on a public road, of gas, milk and milk

products or bread shall not be required to issue a fiscal receipt for every such supply

if he issues one fiscal receipt (hereinafter in this item referred to as "a daily receipt")

which accounts for all the said supplies made on each day in the manner prescribed

in the other provisions of this item.

(2) A daily receipt shall be a fiscal receipt which accounts for the difference

between the goods loaded on the vehicle from which the said supplies are made and

the goods remaining on the vehicle after the said supplies are made for that day as if

such difference represented goods supplied in one supply.

(3) A person who issues daily receipts shall keep the originals therefor together

with the other records he is required to keep for the purposes of this Act.

(4) A person who issues daily receipts shall be required to issue fiscal receipts

in accordance with the other items of this Schedule in respect of any supplies not

referred to in this item.

Supplies of bread by bakers

5. (1) A person who makes supplies of bread from the bakery where that bread

has been baked may apply in writing to the Commissioner for authorisation to issue

one fiscal receipt (hereinafter in this item referred to as "a daily fiscal receipt"),

which daily fiscal receipt shall account for all the said supplies made on each day in

the manner prescribed in the other provisions of this item.

(2) A daily fiscal receipt shall be a fiscal receipt which accounts for all the

separate supplies of that date as if such goods were supplied in one separate supply.

(3) The Commissioner may, by notice in writing, at any time withdraw such

authorisation without giving reasons.

(4) A person who issues daily fiscal receipts shall keep the originals thereof

together with the other records he is required to keep for the purposes of this Act.

(5) A person who issues daily fiscal receipts shall be required to issue fiscal

receipts in accordance with the other items of this Schedule in respect of any other

supplies not referred to in this item, unless such other supplies refer to relatively

small amounts.

Supplies from pumps of leaded petrol, unleaded petrol and diesel (gas) oil

6. (1) A person who makes supplies from pumps, other than automated pumps,

of leaded petrol, unleaded petrol and diesel (gas) oil, shall not be required to issue a

fiscal receipt for every such supply if he issues one fiscal receipt (hereinafter in this

item referred to as "a daily receipt") which accounts for all the supplies made on

each day in the manner prescribed in the other provisions of this item.

(2) A daily receipt shall be a fiscal receipt which accounts for all the said

supplies of that day as if such goods were supplied in one supply.

(3) A person who issues daily receipts shall keep the originals thereof together

with the other records he is required to keep for the purposes of this Act.

(4) A person who issues daily receipts shall be required to issue fiscal receipts

in accordance with the other items of this Schedule in respect of any supplies not

referred to in this item.

Supplies of food and beverages by a canteen situated in a work or study area

7. (1) A person who makes a supply of food and beverages in a canteen

situated in a work or study area may apply in writing to the Commissioner for

authorisation to issue one fiscal receipt in respect of the supply of food and another

fiscal receipt in respect of the supply of beverages (each such receipt hereinafter in

this item referred to as "a daily receipt") which daily receipt shall account for the

said separate supplies made on each day in the manner prescribed in the other

provisions of this item.

(2) The daily receipts shall be the fiscal receipts which account for all the said

separate supplies of that day as if such goods were supplied in two separate supplies,

one in respect of food and one in respect of beverages.

(3) The Commissioner may, by notice in writing, at any time withdraw such

authorisation without giving reasons.

(4) A person who issues daily receipts shall keep the originals thereof together

with the other records he is required to keep for the purposes of this Act.

(5) A person who issued daily receipts shall be required to issue fiscal receipts

in accordance with the other items of this Schedule in respect of any supplies not

referred to in this item.

Supplies of goods by means of vending machines

8. (1) A fiscal receipt in respect of supplies of goods made by means of a

vending machine shall account for the difference in the goods stocked in the machine

every time and immediately after goods are loaded therein and the goods stocked in

the machine immediately before goods are loaded again therein as if that difference

represented goods supplied in one supply: provided that the first receipt to be made

in accordance with this item by a person who is a registered person on the 1st

January, 1999 shall account for the difference in the goods stocked in the machine on

the 1st January 1999 and the goods stocked therein immediately before the first time

in 1999 that goods are loaded therein.

(2) A person who makes supplies of goods by means of a vending machine shall

take readings of stocks every time goods are loaded into the machine and shall keep

a record of such readings and the original of all receipts issued in accordance with

this item together with the other records he is required to keep for the purposes of

this Act.

Services supplied by means of machines

9. (1) A fiscal receipt in respect of supplies of services made by means of a

machine operated by coins shall be issued every time coins are withdrawn from the

machine, and shall account for the value of the coins so withdrawn as if that value

represented the value of services supplied in one supply.

(2) A person who makes supplies referred to in paragraph (1) of this item shall

keep a record of coins withdrawn from and of coins and goods stocked by him (if

any) in the machine, and shall keep the original of all receipts issued in accordance

with the said paragraph together with the other records he is required to keep for the

purposes of this Act.

(3) A fiscal receipt in respect of supplies of services made by means of a

machine operated by an electronic card or by any other token shall be issued every

time a card or other token is supplied and shall account for the price charged or

chargeable for the supply of that card or token as if the supply of the card or other

token represented the supply of services that can be supplied by the use of that card

or other token.

Accounting for fiscal receipts supplied or approved by the Commissioner

10. (1) Every person who is supplied with forms of fiscal receipts by the

Commissioner shall account for all such forms by keeping in his possession, and

producing at the request of the Commissioner, all unused forms, and by keeping one

copy and producing to the Commissioner another copy of all receipts drawn out on

such forms and of all cancelled forms.

(2) Copies of used and cancelled forms of fiscal receipts supplied by the

Commissioner shall be delivered to the Commissioner as soon as possible after the

booklet or other form of binding in which the fiscal receipts have been supplied has

been fully used or at such other date as the Commissioner may require.

(3) Every person who issues fiscal receipts on forms approved by the

Commissioner or in a manner approved by the Commissioner, shall account for all

such receipts in such manner as may be directed by the Commissioner, and for this

purpose the Commissioner may give such directions regarding the processing,

recording and storing of the receipts and of the information to be given therein as he

may deem appropriate.

(4) Any person who fails to account for a fiscal receipt in the manner prescribed

in this item shall be presumed, unless the contrary is proved, to have failed to

account for a taxable supply.

Exemption from obligation to issue a fiscal receipt.

11. (1)

The Commissioner may, by means of a notice in writing, exempt any

person and may by means of a notice published on the Government Gazette and the web

portal designated by the Commissioner for that purpose exempt any class of persons

from any obligation imposed by this Schedule, and such exemption may be given for

such time and with such limitations and subject to such conditions as may be specified in

the said notice.

(2) The Commissioner may at any time by means of a notice published on the

Government Gazette and the web portal designated by the Commissioner for that purpose

revoke any exemption given by virtue of this item.

Obligation to retain and produce receipt

12. Every person to whom a fiscal receipt is issued shall retain the receipt in his

possession for a period of twenty-four hours and shall, upon a request made during

the said time by the Commissioner or any officer authorised by the Commissioner,

produce the said receipt to the Commissioner or such authorised officer.

Fiscal cash register

13. (1) A fiscal cash register shall -

(a) cater for the functions listed in paragraph (2) of this item; and

(b) be of a type specifically approved by the Commissioner by means of a

notice published on the Government Gazette and the web portal designated

by the Commissioner for this purpose or approved for the purposes of and

in accordance with this Act.

(2) The functions for which a fiscal cash register must cater for the purpose of

subparagraph (a) of paragraph (1) of this item are

(a) issuance of an itemised receipt for the supplies made in each transaction

indicating -

(i)

the name and address of the supplier and the Value Added Tax

registration number,

(ii) the goods or services supplied,

(iii) the quantity of each item supplied,

(iv) whether each item is taxable or exempt,

(v) the total, inclusive of tax, of the consideration paid for the

supplies included in the transaction,

(vi) serial number of transaction,

(vii) the tax logo type as specified by the Commissioner,

(viii) cash register serial number,

(ix) date and time of supply,

(x)

and/or such other details as the Commissioner may require;

(b) registering of all day-to-day transactions on a printed or electronic

journal;

(c) storing of predefined data in an inaccessible and unalterable memory.

Fiscal taxi meter

14. (1) A fiscal taxi meter shall -

(a)

cater for the functions listed in paragraph (2) of this item; and

(b) be of a type approved by Transport Malta in terms of the Technical

Specifications published by Transport Malta according to the Taxi Service Regulations,

or any other regulations replacing those Regulations.

(2) The functions for which a fiscal taxi meter must cater for the purpose of

paragraph (1)(a) of this item are

(a) printing of a receipt for the supply made in each transaction indicating -

(i)

the name and the Value Added Tax registration number of the

supplier,

(ii) the taxi permit number,

(iii) date and time of supply,

(iv) serial number of transaction,

(v) the service supplied and applicable rate,

(vi) the total, inclusive of tax, of the consideration paid for the supply,

(vii) the tax logo type as specified by the Commissioner,

(viii) fiscal taxi meter serial number,

(ix) and/or such other details as the Commissioner may require;

(b) storing of predefined data in an inaccessible and unalterable memory.

Without prejudice to the other provisions of this Part the

Commissioner may classify persons registered under this Part by

reference to the description or sector of their activities and such

other matters as he may deem necessary or appropriate and any

classification so made shall unless the contrary is proved be

deemed to be a correct classification for the purpose of determining

the applicability or otherwise of any provision of this Act to which

the classification may be relevant.

Amended by

L.N. 21 of 1999;

[Article 57]

L.N. 201 of 1999;

L.N. 94 of 2001.

Special cases

Substituted by

X. 2003.47.

Amended by

L.N. 426 of 2007;

L.N. 132 of 2009;

L.N. 73 of 2010;

L.N. 424 of 2012;

L.N. 425 of 2012;

L.N. 142 of 2013;

L.N. 348 of 2017;

L.N. 299 of 2018;

L.N. 350 of 2024.

Part One

Cash Accounting

Interpretation

1. In this Part

"qualifying supplies" means

(a)

services performed by a person holding a warrant issued under any

law in force in Malta to practise a profession acting in an independent capacity in

the exercise of such profession;

(b)

services performed by a group of persons holding a warrant issued

under any law in force in Malta to practise a profession whether associated in a

partnership or otherwise, but excluding a company;

(c)

services performed by a company, which if performed by a physical

person would require a warrant issued under any law in force in Malta to perform

such services in the exercise of a profession, and which is registered in

accordance with any law in force in Malta to practice such profession;

(d)

services performed by an arbitrator pursuant to a submission for

arbitration made in conformity with the Arbitration Act;

(e)

services performed by a judicial referee, or an expert appointed by a

court or a tribunal set up by law;

(f)

services performed by civil, mechanical and electrical engineering

contractors in their professional capacity; and

(g)

supplies made by retailers.

Cash accounting option

2. (1)

Subject to the other provisions of this Part, a taxable person

registered under article 10 who carries out qualifying supplies and whose annual

turnover, calculated in accordance with item 3 of the Definitions in the Sixth Schedule,

does not exceed €2,000,000, excluding tax, may opt for such tax to become chargeable

on the earlier of

(a)

the date when a tax invoice or fiscal receipt, as the case may be, is

issued for the supply, to the extent covered by such tax invoice or fiscal receipt; or

(b)

the date when a payment is made for such supply, to the extent

covered by that payment

Provided that the right of deduction of input tax of such person shall be

postponed until the tax on any goods or services supplied to him has been paid to his

supplier.

(2)

The provisions of sub-item (1) shall not apply to supplies of services in

respect of which the tax is payable by the customer and to supplies or transfers of goods

referred to in item 4 of the Fourth Schedule.

Invoices and receipts for qualifying supplies

3. (1)

Where a tax invoice is required to be issued for a qualifying supply

made in terms of item 2, it shall be issued by not later than the fifteenth (15) day of the

month following the month in which the payment for the said supply is made, to the

extent covered by such payment.

(2)

Where a fiscal receipt is required to be issued for a qualifying supply made

in terms of item 2, unless it has been issued before the payment has been made, it shall

be issued and delivered to the person who effects the payment or to whom the supply is

made, immediately after payment has been effected, to the extent covered by such

payment.

Transfers of debts arising from supplies subject to cash accounting

4. Notwithstanding the other provisions of this Part, where a person transfers

any debts owed to him arising as a result of a supply made in terms of item 2, the tax on

such a supply shall become chargeable on the date of such transfer.

Cancellation of a registration under article 10

5. Notwithstanding the other provisions of this Part, where the registration of a

person registered under article 10 is, for any reason cancelled, the tax on a supply made

in terms of item 2 shall become chargeable, at the latest, on the last day of his last tax

period.

Part Two

Second-hand goods, works of art, collectors’ items and antiques

Interpretation

1. In this Part unless the context otherwise requires

(1)

"works of art" means -

(a) pictures, collages and similar decorative plaques, paintings and

drawings executed by hand by the artist, other than plans and drawings

for architectural, engineering, industrial, commercial, topographical or

similar purposes, hand-decorated manufactured articles, theatrical

scenery, studio back cloths or the like of painted canvasses;

(b) original engravings, prints and lithographs, being impressions produced

in limited numbers directly in black and white or in colour of one or of

several plates executed entirely by hand by the artist, irrespective of the

process or of the material employed by him, but not including any

mechanical or photomechanical process;

(c) original sculptures and statuary, in any material, provided that they are

executed entirely by the artist sculpture casts the production of which is

limited to eight copies and supervised by the artist or his successor in

title;

(d) tapestries and wall textiles made by hand from original designs

provided by artists, provided that there are not more than eight copies of

each;

(e) individual pieces of ceramics executed entirely by the artist and signed

by him;

(f)

enamels on copper, executed entirely by hand, limited to eight

numbered copies bearing the signature of the artist or the studio,

excluding articles of jewellery and goldsmiths’ and silversmiths’ wares;

(g) photographs taken by the artist, printed by him or under his supervision,

signed and numbered and limited to 30 copies, all sizes and mounts

included.

(2)

"collectors’ items" means -

(a) postage or revenue stamps, postmarks, first day covers, pre-stamped

stationery and the like, franked, or if unfranked not being of legal tender

and not being intended for use as legal tender;

(b) collections and collectors’ pieces of zoological, botanical,

mineralogical, anatomical, historical, archaeological, palaeontological,

ethnographic or numismatic interest.

(3) "antiques" means objects other than works of art or collectors’ items which

are more than 100 years old.

(4) "second-hand goods" means tangible movable property that is suitable for

further use as it is or after repair, other than works of art, collectors’ items or

antiques and other than precious metals or precious stones.

(5) "second-hand goods dealer" means a taxable person who, in the course of his

economic activity, purchases or acquires for the purposes of his undertaking, or

imports with a view to resale, second-hand goods and/or works of art, collectors’

items or antiques, whether that person is acting for himself or on behalf of another

person pursuant to a contract under which commission is payable on purchase or

(6) "auctioneer" means any taxable person who, in the course of his economic

activity, offers goods for sale by public auction with a view to handing them over to

the highest bidder.

(7) "principal of an auctioneer" means any person who transmits goods to an

auctioneer under a contract under which commission is payable on a sale subject to

the following provisions -

(a) the auctioneer offers the goods for sale in his own name but on behalf of

his principal;

(b) the auctioneer hands over the goods, in his own name but on behalf of

his principal, to the highest bidder at a public auction.

Second-hand goods dealer

2. A second-hand goods dealer who makes supplies of second-hand goods,

works of art, collectors’ items and antiques, shall charge and collect tax on the profit

margin, in accordance with the other provisions of this Part.

Supplies

3. The supplies of goods referred to in item 2 of this Part shall be supplies of

second-hand goods, works of art, collectors’ items and antiques, made by a second-

hand goods dealer, which had been supplied to him within the Community -

(a) by a non-taxable person; or

(b) by another taxable person not being a taxable person covered by the

exemption for small enterprises provided for in Article 284 of Council

Directive 2006/112/EC, in so far as the supply of goods by such other

person is an exempt without credit supply;

(c) by another taxable person, in so far as the supply of goods by such other

taxable person is covered by the exemption for small enterprises provided

for in Article 284 of Council Directive 2006/112/EC and involves capital

goods.

(d) by another second-hand goods dealer, in so far as the supply of goods by

that other second-hand goods dealer was subject to value added tax in

accordance with the other provisions of this Part.

Taxable Value

4. (1) The taxable value of the supplies of goods referred to in item 3 of this

Part shall be the profit margin made by the second-hand goods dealer less the

amount of value added tax relating to the profit margin. That profit margin shall be

equal to the difference between the selling price charged by the second-hand goods

dealer for the goods and the purchase price.

(2)

For the purposes of paragraph (1) of this item -

(a) "selling price" means everything which constitutes the consideration

which has been, or is to be, charged by the second-hand goods dealer to

the purchaser, including subsidies directly linked to that transaction,

taxes, duties, levies and charges and incidental expenses such as

commission, packaging, transport and insurance costs charged by the

second-hand goods dealer to the purchaser but excluding discounts and

repayment for expenses paid out in the name and for the account of the

purchaser;

(b) "purchase price" means everything which constitutes the consideration

as defined in subparagraph (a) of this paragraph, paid, or to be paid, by

the second-hand goods dealer to his supplier.

Applicable option

5. (1) Second-hand goods dealers shall have the option to apply the provisions

of this Part, after having obtained the approval of the Commissioner in writing, in

respect of supplies of

(a) works of art supplied to them by their creators or their successors in

title; and

(b) works of art supplied to them by a taxable person other than a taxable

dealer.

(2) Where a second-hand goods dealer exercises the option available under sub-

item (1), such option shall cover, a minimum of, two (2) calendar years.

(3) Where a second-hand goods dealer exercises the option available under sub-item

(1), the taxable value shall be determined in accordance with item 4 of this Part.

Input Tax

6. (1) Taxable persons shall not be entitled to deduct the value added tax due

or paid in respect of goods which have been, or are to be, supplied to them by

second-hand goods dealers, where the supply of those goods has been subject to the

provisions of this Part.

(2) Where the second-hand goods dealer accounts for value added tax in terms

of the provisions of this Part, he shall not be entitled to claim back -

(a) value added tax due or paid in respect of works of art, collectors’ items

or antiques which he has imported himself;

(b) value added tax due or paid in respect of works which have been, or are

to be supplied, to him by their creators or their successors in title;

(c) value added tax due or paid in respect of works of art which have been,

or are to be, supplied to him by a taxable person other than a second

hand goods dealer.

Separate accounting

7. Where a second-hand goods dealer makes supplies to which this Part refers

and other supplies, he must keep separate accounts to distinguish between the

supplies made to which this Part refers and those other supplies.

Purchase invoice

8. Where a supply of second-hand goods to a second-hand goods dealer has

been made by a person who had not supplied the said goods in the course of an

economic activity, such dealer shall issue a purchase invoice at the time when the

said goods have been supplied to him, containing the following information -

(a) the purchase invoice number;

(b) the date of the purchase;

(c) the name and address of the seller;

(d) the name and address of the purchaser;

(e) a description of the goods;

(f)

the total price paid;

(g) a cross reference to the entry of the transaction in the purchaser’s

account books;

(h) the signature of the seller.

Sales invoice

9. A second-hand goods dealer who makes any supply to which this Part refers

shall not issue a tax invoice or any other document showing an amount as being tax

or as being attributed to tax, but shall issue a sales invoice containing the following

information and shall keep a copy thereof -

(a) the sales invoice number;

(b) the date of the sale;

(c) the name, address and value added tax registration number of the seller;

(d) the name and address of the purchaser;

(e) a description of the goods;

(f)

the total price inclusive of tax;

(g) a cross reference to the entry of the transaction in the seller’s account

books;

(h) the following declaration signed by the seller

"I declare that no credit for input tax has or will be claimed by me in

respect of the goods sold on this invoice.".

Option available for second-hand goods dealers

10. (1) A second-hand goods dealer may account for value added tax in terms

of the other provisions of the Act to any supply to which items 2 and 3 of this Part

refer, without any reference to this Part.

(2)

Where a second-hand goods dealer so opts in respect of -

(a) the supply of works of art, collectors’ items or antiques which he has

imported himself, he shall be entitled to claim back the value added tax

due or paid on the importation of those goods;

(b) the supply of works of art supplied to him by their creator, he shall be

entitled to claim back the value added tax due or paid for the work of art

supplied to him;

(c) the supply of works of art supplied to him by a taxable person other than

a second-hand goods dealer, he shall be entitled to claim back the value

added tax due or paid for the work of art supplied to him.

(3) The right to claim back input tax on supplies to which paragraph (1) of this

item refers shall arise at the time of submitting the value added tax return.

Sales by public auction

11. (1) Where an auctioneer makes a supply of second-hand goods, works of

art, collectors’ items or antiques by public auction, acting in his own name, pursuant

to a contract under which commission is payable on the sale of those goods by public

auction, on behalf of -

(a) a non-taxable person; or

(b) another taxable person in so far as the supply of goods by that other

registered person is made pursuant to a contract under which

commission is payable on purchase or sale and is an exempt supply in

terms of Part Two of the Fifth Schedule to the Act; or

(c) another taxable person, in so far as the supply of goods, carried out by such

taxable person in accordance with a contract under which commission is

payable on sale, is covered by the exemption for small enterprises provided

for in Article 284 of Council Directive 2006/112/EC and involves capital

goods; or

(d) another second-hand goods dealer, in so far as the supply of goods by

that other second-hand goods dealer is made pursuant to a contract

under which commission is payable on purchase or sale and is subject to

value added tax in terms of the other provisions of this Part,

the taxable value of each supply of goods shall be that specified in the other

paragraphs of this item.

(2) The taxable value of each supply of goods to which paragraph (3) of this

item applies is the total amount invoiced to the purchaser by the auctioneer in

accordance with paragraph (4) of this item, less -

(a) the net amount paid or to be paid by the auctioneer to his principal,

determined in accordance with paragraph (3) of this item, and

(b) the amount of the tax due by the auctioneer in respect of that supply.

(3) The net amount paid or to be paid by the auctioneer to his principal shall be

equal to the difference between -

(a) the price of the goods at the public auction, and

(b) the amount of the commission obtained or to be obtained by the

auctioneer from his principal, under the contract whereby commission is

payable on the sale.

(4) An auctioneer must issue to the purchaser a sales invoice containing the

following information -

(a) the sales invoice number;

(b) the date of the sale;

(c) the name, address and value added tax registration number of the seller;

(d) the name and address of the purchaser;

(e) a description of the goods;

(f)

the auction price of the goods;

(g) taxes, dues, levies and charges;

(h) incidental expenses such as commission, packing, transport and

insurance costs charged by the auctioneer to the purchaser;

(i)

reference to the entry of the transaction in the seller’s account books;

(j)

the following declaration signed by the seller

"I declare that no credit for input tax has or will be claimed by me in

respect of the goods sold on this invoice.";

and the sales invoice shall not show any amount of value added tax separately.

(5) The auctioneer to whom the goods were transmitted under a contract

whereby commission is payable on a public auction sale must issue an invoice to his

principal, containing the following information

(a) a consecutive invoice number;

(b) the date of the transaction;

(c) the name and address of the principal;

(d) the name, address and value added tax registration number of the

auctioneer;

(e) a description of the goods;

(f)

the amount of the transaction (i.e. the auction price of the goods less the

amount of commission obtained or to be obtained from the principal);

(g) the signature of the principal

Provided that where the principal is a taxable person, the invoice so drawn

up shall serve as the tax invoice required to be issued in terms of the Twelfth

Schedule to the Act.

(6) Auctioneers who supply goods under the conditions laid down in paragraph

(1) of this item, must indicate in the suspense account of their accounts -

(a) the amounts obtained or to be obtained from the purchaser of the goods;

(b) the amount reimbursed or to be reimbursed to the vendor of the goods;

and the above amounts must be substantiated by the relevant documentation.

(7) The supply of goods by an auctioneer shall be deemed to be made at the time

when the sale of those goods by public auction is effected.

Repossessed goods

12. Where any goods are repossessed -

(a) under the terms of a finance agreement, or

(b) by any insurer in the settlement of a claim under an insurance policy, or

(c) by a mortgagee in terms of his rights under a mortgage over a ship or

aircraft,

and supplied by the person who repossessed them in the same condition as they were

in at the time they were repossessed, the said supply by that person shall be treated

as neither a supply of goods nor as a supply of services.

Part Three

Professional Services

Definition of professional services

1. For the purpose of this Part, "professional services" shall mean the qualifying

services referred to in Part One of this Schedule."

Date when certain services are performed

2. When, for any purpose of this Act, it is necessary to determine the date

when professional services referred to in this Part are performed, the following

provisions shall apply

(a)

the services of an advocate or of a legal procurator in assisting any

party to judicial proceedings shall be treated as performed on the date when a

final decree or judgment in those proceedings is delivered by the court in which

the proceedings have been instituted, or, when the advocate or legal procurator

abandons or is abandoned by his client at an earlier date, on such earlier date

Provided that services relating to proceedings instituted in different

courts are to be treated as supplied separately;

(b)

the services of a judicial referee or of an expert appointed by a court

or a tribunal set up by law shall be treated as performed on the date on which the

report is filed or made to the court or tribunal or, when the appointment is

terminated on an earlier date, on such earlier date; and

(c)

the services of an arbitrator shall be treated as performed on the date

of the award or, when the appointment is terminated on an earlier date, on such

earlier date.

Tax on certain professional services where tariffs of fees are established by law

3. (1)

The tax chargeable on a supply of professional services shall be an

amount over and above the amount resulting to be chargeable for those services in terms

of any tariff of fees established under any law in force in Malta.

(2)

Nothing in this item shall be construed as requiring any person required by

law to assess or declare the fees payable in accordance with any such tariff to declare or

assess also the said tax.

(3)

In any action for the enforcement of the executive title referred to in article

253(c) of the Code of Organization and Civil Procedure, the amount for which payment

may be enforced shall be the amount indicated in the taxed bill of costs concerned

increased by any tax chargeable on the supply of professional services to which the taxed

bill of costs refers as evidenced by a tax invoice or a fiscal receipt or a certified copy

thereof attached to the said bill.

(4)

The provisions of sub-item (3) shall be without prejudice to the right of the

debtor to request the delivery of the original tax invoice or the fiscal receipt in

accordance with item 4 of this Part.

Tax claimed from third parties

4. The provisions of this item shall apply with respect to any action for the

payment of fees for professional services brought against any person other than the

person to whom the services were supplied

(a)

the person against whom the action is brought shall not be bound to

pay the amount relating to the tax, if any, chargeable on the supply of the said

services unless the original tax invoice or fiscal receipt for those services

complying with the provisions of paragraph (b) is delivered to him or, where the

action is brought against a number of persons jointly, to any one of them;

(b)

a tax invoice delivered as aforesaid shall, in addition to the

information required by this Act, contain

(i)

the following declaration signed by the person to whom the

said services were rendered

"I declare that no credit for input tax has been or shall be

claimed by me in respect of the professional services referred to in

this tax invoice;

(ii)

where the person against whom the action or claim is brought

is a person registered under article 10 or, where the action is brought

against a number of persons jointly, when any one of them is a person

registered under article 10, the name and value added tax identification

number of the said registered person; and

(c) when a tax invoice or fiscal receipt for fees for professional services,

complying with the provisions of paragraph (b) if applicable, is

delivered to a taxable person who is bound at law to pay or reimburse

the said fees it shall for the purposes of this Act be deemed as if it were

a tax invoice for professional services supplied to him.

Part Four

Travel Agents

Interpretation

1. In this Part "travel agent" means and includes any person who, without

material alterations, buys in and re-sells travel, hotel, holiday and other related

services to travellers, and shall include a tour operator.

Application

2. The provisions of this Part shall apply to the operations of travel agents,

where the travel agent deals with the customer in his own name and uses the supplies

and services of other persons in the provision of travel facilities

Provided that this Part shall not apply to a travel agent who acts only as an

intermediary and merely makes a repayment of expenses to another person in the

name and for the account of the traveller.

Services supplied to be deemed as a single transaction

3. All transactions performed by a travel agent for the benefit of the traveller in

connection with the journey shall be treated as a single supply of services supplied

by him to the traveller.

Place of supply

4. The place of supply of services to which item 3 applies is the place where

the travel agent is established.

Taxable value

5. The taxable value of supplies referred to in item 3 of this Part made by a

travel agent shall be the difference between the cost of those supplies to the travel

agent inclusive of value added tax and the total price charged to the traveller

exclusive of value added tax, where the supplies are for the direct benefit of the

traveller

Provided that where a supply to a travel agent is required in terms of this Act

to be supported by a tax invoice, the cost of that supply shall only be taken into

account for the purposes of this item if the travel agent holds such a tax invoice.

Input tax

6. Value added tax charged to the travel agent by other registered persons on

supplies made by those registered persons to the travel agent for the purpose of

supplies to which item 3 applies and for the direct benefit of the traveller shall not be

eligible for deduction or refund.

Supplies outside the Community

7. If transactions entrusted by the travel agent to other taxable persons are

performed by such persons outside the Community, the travel agent’s service shall

be treated as the service of an intermediary which is exempt with credit in terms of

item 5 of Part One of the Fifth Schedule. When these transactions are performed

both inside and outside the Community, only that part of the travel agent’s services

relating to transactions outside the Community shall be so treated as exempt with

credit.

Powers of the Commissioner

8. The Commissioner may give such directives to, and require such

information from, a travel agent as he may deem necessary for the application of this

Part.

Records

9. A travel agent shall keep, in addition to the records required to be kept in

terms of the other provisions of this Act, such other records as may be necessary to

readily ascertain the amount of tax chargeable under this Part.

Part Five

Tax in Danger

1. Where, in any particular contract of supply, and in order to secure the regular

payment of the tax in terms of this Act, the Commissioner may, by notice in writing to

the parties to the contract direct that the payment of the tax on a taxable supply made to a

person established in Malta and registered under articles 10 or 12 shall be a liability of

the person to whom the supply is made.

2. When a direction to which item 1 of this Part refers has been given by the

Commissioner, the person to whom the supply is made shall keep, in addition to the

records required to be kept in terms of the other provisions of the Act, such other

records as may be necessary to ascertain the amount of tax payable under this Part.

3. When a direction has been given by the Commissioner in terms of item 1 of this

Part, the tax invoice which is required to be issued in terms of this Act by the person who

makes the supply shall, instead of the information required by item 3(i) of the Twelfth

Schedule, indicate the words "Direction for customer to self-charge VAT in terms of Part

Five of the Fourteenth Schedule to the VAT Act.

4. When a direction has been given by the Commissioner in terms of item 1 of

this Part, such direction shall not in any way limit the right to claim any input tax to

which any of the persons to whom the direction has been given, may still be entitled

to claim in accordance with the other provisions of the Act.

Part Six

Investment Gold

Meaning of investment gold

1. (1)

"Investment gold" means

(a) gold, in the form of a bar or a wafer of weights accepted by the bullion

markets, of a purity equal to or greater than 995 thousandths, whether or

not represented by securities. Member States may exclude from the

scheme small bars or wafers of a weight of 1g or less;

(b) gold coins which

(i)

are of a purity equal to or greater than 900 thousandths,

(ii) re-minted after 1800,

(iii) are or have been legal tender in the country of origin, and

(iv) are normally sold at a price which does not exceed the open

market value of the gold contained in the coins by more than 80%.

(2) Coins referred to in paragraph (1)(b) shall not, for the purpose of this Act,

be considered to be sold for numismatic interest.

Option for taxation

2. (1) Taxable persons who produce investment gold or transform any gold

into investment gold have a right of option for taxation of supplies of investment

gold to another taxable person which would otherwise be exempt in terms of Part

One of the Fifth Schedule.

(2) An agent who, acting in the name and for the account of another, intervenes

for his principal in a supply in respect of which the supplier has exercised the option

referred to in paragraph (1) has a right of option for taxation of the supply of his

services.

(3) An option referred to in this item shall be exercised by means of an

irrevocable notice in writing delivered to the Commissioner. Such notice

(a) shall specify clearly that it is a notice made pursuant to this item and

indicate whether it is an option of the supplier or an option of the agent;

(b) shall be made before the supplies to which it refers are made or by not

later than thirty days after the date of any such supplies;

(c) shall specify the name and value added tax identification number of the

taxable person to whom the supplies are made or to be made and their

taxable value.

Special obligations for traders in investment gold

3. Traders in investment gold keep account of all substantial transactions in

investment gold and keep the documentation to allow identification of the customer

in such transactions.

Part Seven

Substituted by

L.N. 226 of 2020.

Special schemes for taxable persons supplying services to non-

taxable persons or making distance sales of goods or certain

domestic supplies of goods

Section 1

General Provisions

Interpretation

1. In this Part, the following definition shall apply

"VAT return" means the statement containing the information necessary to

establish the amount of VAT due in each Member State.

Section 2

Special scheme for services supplied by taxable persons not established within the

Community

Interpretation

1. For the purpose of this Section, without prejudice to other provisions of this

Act, the following definitions shall apply

"Member State of consumption" means the Member State in which the supply of

services is deemed to take place according to Part Two of the Third Schedule;

"Member State of identification" means the Member State which the taxable

person not established within the Community chooses to contact to state when his

activity as a taxable person within the territory of the Community commences in

accordance with the provisions of this Section;

"taxable person not established within the Community" means a taxable person

who has not established his business in the territory of the Community and who has

no fixed establishment there.

Permission to use the special scheme

2. The Commissioner shall permit any taxable person not established within

the Community supplying services to a non-taxable person who is established in a

Member State or has his permanent address or usually resides in a Member State, to

use this special scheme. This scheme applies to all those services supplied within the

Community.

Notification to the Commissioner

3. The taxable person not established within the Community shall state to the

Commissioner when he commences or ceases his activity as a taxable person, or

changes that activity in such a way that he no longer meets the conditions necessary

for use of this special scheme. He shall communicate that information electronically.

Information that shall be provided to the Commissioner

4. (1) The information which the taxable person not established within the

Community shall provide to the Commissioner when he commences a taxable

activity shall contain the following details

(a) name;

(b) postal address;

(c) electronic addresses, including websites;

(d) national tax code number, if any;

(e) a statement that the person has not established his business in the

territory of the Community and has no fixed establishment there.

(2) The taxable person not established within in the Community shall notify the

Commissioner of any changes in the information provided.

VAT identification number

5. The Commissioner shall allocate to the taxable person not established within

the Community an individual VAT identification number for the application of this

special scheme and shall notify him of that number by electronic means. On the basis

of the information used for that identification, Member States of consumption may

have recourse to their own identification systems.

Cancellation from identification register

6. The Commissioner shall delete the taxable person not established within the

Community from the identification register in the following cases

(a) if he notifies the Commissioner that he no longer supplies services

covered by this special scheme;

(b) if it may otherwise be assumed that his taxable activities have ceased;

(c) if he no longer meets the conditions necessary for use of this special

scheme;

(d) if he persistently fails to comply with the rules relating to this special

scheme.

Submission of VAT return

7. The taxable person not established within the Community making use of this

special scheme shall submit by electronic means to the Commissioner a VAT return

for each calendar quarter, whether or not services covered by this special scheme

have been supplied. The VAT return shall be submitted by the end of the month

following the end of the tax period covered by the return.

Details and adjustments that shall be included in VAT return

8. The VAT return shall show the individual VAT identification number for the

application of this special scheme and, for each Member State of consumption in

which VAT is due, the total value, exclusive of VAT, of supplies of services covered

by this special scheme carried out during the tax period and total amount per rate of

the corresponding VAT. The applicable rates of VAT and the total VAT due shall also

be indicated on the return. Where any amendments to the VAT return are required

after its submission, such amendments shall be included in a subsequent return

within three (3) years of the date on which the initial return was required to be

submitted pursuant to item 7. That subsequent VAT return shall identify the relevant

Member State of consumption, the tax period and the amount of VAT for which any

amendments are required.

Reporting currency

9. The value added tax return shall be made out in euro. If the supplies have

been made in other currencies, the taxable person not established within the

Community shall, for the purpose of completing the VAT return, use the exchange

rate applying on the last day of the tax period. The conversion shall be made by

applying the exchange rates published by the European Central Bank for that day, or

if there is no publication for that day, on the next day of publication.

Payment of the tax

10. The taxable person not established within the Community shall pay the VAT,

making reference to the relevant VAT return, when submitting the VAT return, at the

latest, at the expiry of the deadline by which the return shall be submitted.

Payment shall be made to a bank account denominated in euro, designated by the

Commissioner.

Deduction of input tax

11. The taxable person not established within the Community making use of this

special scheme may not deduct VAT pursuant to Article 168 of Council Directive

2006/112/EC. Notwithstanding paragraph 1 of Article 1 of Directive 86/560/EEC,

the taxable person in question shall be refunded in accordance with that Directive.

Article 2(2) and (3), and Article 4(2) of Directive 86/560/EEC shall not apply to

refunds relating to services covered by this special scheme.

If the taxable person making use of this special scheme is required to be registered

in a Member State for activities not covered by this special scheme, he shall deduct

VAT incurred in that Member State in respect of his taxable activities which are

covered by this special scheme in the VAT return that shall be submitted pursuant to

Article 250 of Council Directive 2006/112/EC.

Records

12. (1)The taxable person not established within the Community shall keep

records of the transactions covered by this special scheme. Those records shall be

s u ff i c i e nt l y d e t a il e d t o en a bl e t h e t a x a ut h o r it i e s o f th e M e m ber State o f

consumption to verify that the VAT return is correct.

(2) The records referred to in sub-item (1) shall be made available electronically

on request to the Commissioner and to the Member State of consumption.

Those records shall be kept for a period of ten (10) years from the end of the year

during which the transaction was carried out.

Section 3

Special scheme for intra-Community distance sales of goods, for supplies of

goods within a Member State made by electronic interfaces facilitating those

supplies and for services supplied by taxable persons established within the

Community but not in the Member State of consumption

Interpretation

1. For the purpose of this Section, without prejudice to other provisions of this

Act, the following definitions shall apply

"Member State of consumption" means one (1) of the following

(a) in the case of the supply of services, the Member State in which the

supply is deemed to take place in terms of Part Two of the Third

Schedule;

(b) in the case of intra-Community distance sales of goods, the Member

State where the dispatch or transport of the goods to the customer ends;

(c) in the case of the supply of goods made by a taxable person facilitating

those supplies in accordance with sub-item (2) of item 12A of the

Second Schedule, where the dispatch or transport of the goods supplied

begins and ends in the same Member State, that Member State;

"Member State of identification" means the Member State in the territory of which

the taxable person has established his business or, if he has not established his

business in the Community, where he has a fixed establishment.

Where a taxable person has not established his business in the Community, but has

more than one (1) fixed establishment therein, the Member State of identification

shall be the Member State with a fixed establishment where that taxable person

indicates that he shall make use of this special scheme. The taxable person shall be

bound by this decision for the calendar year concerned and the two (2) calendar

years following.

Where a taxable person has not established his business in the Community and has

no fixed establishment therein, the Member State of identification shall be the

Member State in which the dispatch or transport of the goods begins. Where there is

more than one (1) Member State in which the dispatch or transport of the goods

begins, the taxable person shall indicate which of those Member States shall be the

Member State of identification. The taxable person shall be bound by that decision

for the calendar year concerned and the two (2) calendar years following;

"taxable person not established in the Member State of consumption" means a

taxable person who has established his business in the Community or has a fixed

e s t a bl ish me nt th e r e b ut h a s n ot e s tab li s hed h is bu s in e s s a n d has no f ixed

establishment within the territory of the Member State of consumption.

Permission to use the special scheme

2. The Commissioner shall permit the following taxable persons to use this

special scheme

(a) a taxable person carrying out intra-Community distance sales of goods;

(b) a taxable person facilitating the supply of goods in terms of sub-item (2)

of item12A of the Second Schedule where the dispatch or transport of

the goods supplied begins and ends in the same Member State;

(c) a taxable person not established in the Member State of consumption

supplying services to a non-taxable person.

This special scheme applies to all those goods or services supplied in the

Community by the taxable person concerned.

Notification to the Commissioner

3. A taxable person shall state to the Commissioner when he commences and

ceases his taxable activities covered by this special scheme, or changes those

activities in such a way that he no longer meets the conditions necessary for use of

this special scheme. He shall communicate that information by electronic means.

VAT identification number

4. A taxable person making use of this special scheme shall, for the taxable

transactions carried out under this scheme, be identified for VAT purposes in Malta

only. For that purpose the Commissioner shall use the individual VAT identification

number already allocated to the taxable person in respect of his obligations under the

internal system.

On the basis of the information used for that identification, Member States of

consumption may have recourse to their own identification systems.

Exclusion from the special scheme

5. The Commissioner shall exclude a taxable person from the special scheme in

any one (1) of the following cases

(a) if he notifies that he no longer carries out supplies of goods and services

covered by this special scheme;

(b) if it may otherwise be assumed that his taxable activities covered by this

special scheme have ceased;

(c) if he no longer meets the conditions necessary for use of this special

scheme;

(d) if he persistently fails to comply with the rules relating to this special

scheme.

Submission of VAT return

6. The taxable person making use of this special scheme shall submit by

electronic means to the Commissioner a VAT return for each calendar quarter,

whether or not supplies of goods and services covered by this special scheme have

been carried out. The VAT return shall be submitted by the end of the month

following the end of the tax period covered by the return.

Details and adjustments that shall be included in VAT return

7. (1) The VAT return shall show the VAT identification number referred to in

item 4 and, for each Member State of consumption in which VAT is due, the total

value exclusive of VAT, the applicable rates of VAT, the total amount per rate of the

corresponding VAT and the total VAT due in respect of the following supplies

covered by this special scheme carried out during the tax period

(a) intra-Community distance sales of goods;

(b) supplies of goods in accordance with sub-item (2) of item 12A of the

Second Schedule where the dispatch or transport of those goods

provided begins and ends in the same Member State;

(c) supplies of services.

The VAT return shall also include amendments relating to previous tax periods as

provided in sub-item (4).

(2) Where goods are dispatched or transported from Member States other than

Malta, the VAT return shall also include the total value exclusive of VAT, the

applicable rates of VAT, the total amount per rate of the corresponding VAT and the

total VAT due in respect of the following supplies covered by this special scheme,

for each Member State where such goods are dispatched or transported from

(a) intra-Community distance sales of goods other than those made by a

taxable person in accordance with sub-item (2) of item 12A of the

Second Schedule;

(b) intra-Community distance sales of goods and supplies of goods where

the dispatch or transport of those goods begins and ends in the same

Member State, made by a taxable person in accordance with sub-item

(2) of item 12A of the Second Schedule.

In relation to the supplies referred to in paragraph (a), the VAT return shall also

include the individual VAT identification number or the tax reference number

allocated by each Member State where such goods are dispatched or transported

from.

In relation to the supplies referred to in paragraph (b), the VAT return shall also

include the individual VAT identification number or the tax reference number

allocated by each Member State where such goods are dispatched or transported

from, if available.

The VAT return shall include the information referred to in this sub-item broken

down by Member State of consumption.

(3) Where the taxable person supplying services covered by this special scheme

has one (1) or more fixed establishments, other than that in Malta, from which the

services are supplied, the VAT return shall also include the total value exclusive of

VAT, t h e a p p l i c a b l e r a t e s o f VAT, t h e t o t a l a m o u n t p e r e v e r y r a t e o f t h e

corresponding VAT and the total VAT due of such supplies, for each Member State in

which he has an establishment, together with the individual VAT identification

number or the tax reference number of this establishment, broken down by Member

State of consumption.

(4) Where any amendments to the VAT return are required after its submission,

such amendments shall be included in a subsequent return within three (3) years of

the date on which the initial return was required to be submitted pursuant to item 6.

T h a t s u b s e q u e n t VAT r e t u r n s h a l l i d e n t i f y t h e r e l e v a n t M e m b e r St a t e o f

consumption, the tax period and the amount of VAT for which any amendments are

required.

Reporting currency

8. The VAT return shall be made out in euro.

If the supplies have been made in other currencies, the taxable person making use

of this special scheme shall, for the purpose of completing the VAT return, use the

exchange rate applying on the last date of the tax period. The conversion shall be

made by applying the exchange rates published by the European Central Bank for

that day, or if there is no publication for that day, on the next day of publication.

Payment of the tax

9. The taxable person making use of this special scheme shall pay the VAT,

making reference to the relevant VAT return, at the latest at the expiry of the

deadline by when the return shall be submitted.

Payment shall be made to a bank account denominated in euro, designated by the

Commissioner.

Deduction of input tax

10. The taxable person making use of this special scheme may not, in respect of

his taxable activities covered by this special scheme, deduct VAT incurred in the

Member State of consumption pursuant to Article 168 of Council Directive 2006/

112/EC. Notwithstanding Article 2(1), Article 3 and point (e) of Article 8(1) of

Directive 2008/9/EC, the taxable person in question shall be refunded in accordance

with that Directive.

If the taxable person making use of this special scheme is required to be registered

in a Member State for activities not covered by this special scheme, he shall deduct

VAT incurred in that Member State in respect of his taxable activities which are

covered by this special scheme in the VAT return that shall be submitted pursuant to

Article 250 of Council Directive 2006/112/EC.

Records

11. (1) The taxable person making use of this special scheme shall keep records

of the transactions covered by this special scheme. Those records shall be

s u ff ic i e n tl y de ta i le d t o e na b le t h e t a x a u t ho r i ti e s o f t he M e m ber State o f

consumption to verify that the VAT return is correct.

(2) The records referred to in sub-item (1) shall be made available electronically

on request to the Member State of consumption and to the Commissioner.

Those records shall be kept for a period of ten (10) years from 31 December of the

year during which the transaction was carried out.

Section 4

Special scheme for distance sales of goods imported from third territories or third

countries

Interpretation

1. For the purposes of this Section, without prejudice to other provisions of

this Act, the following definitions shall apply

"intermediary" means a person established in the Community appointed by the

taxable person carrying out distance sales of goods imported from third territories or

third countries as the person liable for payment of the VAT and to fulfil the

obligations laid down in this special scheme in the name and on behalf of the taxable

person;

"Member State of consumption" means the Member State where the dispatch or

transport of the goods to the customer ends;

"Member State of identification" means the following

(a) where the taxable person is not established in the Community, the

Member State in which he chooses to register;

(b) where the taxable person has established his business outside the

Community but has one (1) or more fixed establishments therein, the

Member State with a fixed establishment where the taxable person

indicates he shall make use of this special scheme;

(c) where the taxable person has established his business in a Member

State, that Member State;

(d) where the intermediary has established his business in a Member State,

that Member State;

(e) where the intermediary has established his business outside the

Community but has one (1) or more fixed establishments therein, the

Member State with a fixed establishment where the intermediary

indicates he shall make use of this special scheme.

For the purposes of sub-paragraphs (b) and (e), where the taxable person or the

intermediary has more than one (1) fixed establishment in the Community he shall

be bound by the decision to indicate the Member State of establishment for the

calendar year concerned and the two (2) calendar years following;

"taxable person not established within the Community" means a taxable person

who has not established his business in the territory of the Community and who has

no fixed establishment there.

Distance sales of goods imported from third territories or third countries

2. For the purposes of this Section, distance sales of goods imported from third

territories or third countries shall only cover goods, except goods subject to excise

duty, in consignments of an intrinsic value not exceeding one-hundred and fifty euro

Permission to use the special scheme

3. (1) The Commissioner shall permit the following taxable persons carrying

out distance sales of goods imported from third territories or third countries to use

this special scheme

(a) any taxable person established in the Community carrying out distance

sales of goods imported from third territories or third countries;

(b) any taxable person whether or not established in the Community

carrying out distance sales of goods imported from third territories or

third countries and who is represented by an intermediary established in

the Community;

(c) any taxable person established in a third country with which the Union

has concluded an agreement on mutual assistance similar in scope to

Council Directive 2010/24/EU and Regulation (EU) No 904/2010 and

who is carrying out distance sales of goods imported from that third

country. Those taxable persons shall apply this special scheme to all

their distance sales of goods imported from third territories or third

countries.

(2)

For the purposes of paragraph (b) of sub-item (1), any taxable person shall

not appoint more than one (1) intermediary at the same time.

Chargeable event and chargeability of tax

4. For distances sales of goods imported from third territories or third countries

on which VAT is declared under this special scheme, the chargeable event shall occur

and VAT shall become chargeable at the time of supply. The goods shall be regarded

as having been supplied at the time when the payment has been accepted.

Notification to the Commissioner

5. The taxable person making use of this special scheme or an intermediary

acting on his behalf, shall state to the Commissioner when he commences or ceases

his activity under this special scheme, or changes that activity in such a way that he

no longer meets the conditions necessary for use of this special scheme. That

information shall be communicated electronically.

Information that shall be provided to the Commissioner

6. (1) The information which the taxable person not making use of an

intermediary shall provide to the Commissioner before he commences the use of this

special scheme, shall contain the following details

(a) name;

(b) postal address;

(c) electronic address and websites;

(d) VAT identification number or national tax code number.

(2) The information which the intermediary shall provide to the Commissioner

before he commences the use of this special scheme on behalf of a taxable person

shall contain the following details

(a) name;

(b) postal address;

(c) electronic address;

(d) VAT identification number.

(3) The information which the intermediary shall provide to the Commissioner

in respect of each taxable person which he represents before that taxable person

commences the use of this special scheme, shall contain the following details

(a) name;

(b) postal address;

(c) electronic address and websites;

(d) VAT identification number or national tax code number;

(e) his individual identification number allocated in accordance with sub-

item (3) of item 7.

(4) Any taxable person making use of this special scheme or, where applicable,

his intermediary shall notify the Commissioner of any changes in the information

provided.

VAT identification number

7. (1)The Commissioner shall allocate to the taxable person making use of this

special scheme an individual VAT identification number for the application of this

special scheme and shall notify him of that number by electronic means.

(2) The Commissioner shall allocate to an intermediary an individual

identification number and shall notify him of that number by electronic means.

(3) The Commissioner shall allocate an individual VAT identification number

for the application of this special scheme to the intermediary in respect of each

taxable person for which he is appointed.

(4) The VAT identification number allocated under sub-items (1), (2) and (3)

shall be used only for the purposes of this special scheme.

Cancellation from identification register

8. (1) The Commissioner shall delete the taxable person not making use of an

intermediary from the identification register in the following cases

(a) if he notifies the Commissioner that he no longer carries out distance

sales of goods imported from third territories or third countries;

(b) if it may otherwise be assumed that his taxable activities of distance

sales of goods imported from third territories or third countries have

ceased;

(c) if he no longer meets the conditions necessary for use of this special

scheme;

(d) if he persistently fails to comply with the rules relating to this special

scheme.

(2) The Commissioner shall delete the intermediary from the identification

register in the following cases

(a) if for a period of two (2) consecutive calendar quarters he has not acted

as an intermediary on behalf of a taxable person making use of this

special scheme;

(b) if he no longer meets the other conditions necessary for acting as an

intermediary;

(c) if he persistently fails to comply with the rules relating to this special

scheme.

(3) The Commissioner shall delete the taxable person represented by an

intermediary from the identification register in the following cases

(a) if the intermediary notifies the Commissioner that this taxable person

no longer carries out distance sales of goods imported from third

territories or third countries;

(b) if it may otherwise be assumed that the taxable activities of distance

sales of goods imported from third territories or third countries of this

taxable person have ceased;

(c) if this taxable person no longer meets the conditions necessary for use

of this special scheme;

(d) if this taxable person persistently fails to comply with the rules relating

to this special scheme;

(e) if the intermediary notifies the Commissioner that he no longer

represents this taxable person.

Submission of VAT return

9. The taxable person making use of this special scheme or his intermediary

shall submit by electronic means to the Commissioner a VAT return for each month,

whether or not distance sales of goods imported from third territories or third

countries have been carried out. The VAT return shall be submitted by the end of the

month following the end of the tax period covered by the return.

Where a VAT return shall be submitted in accordance with this item, the

Commissioner shall not impose, for VAT purposes, any additional obligation or any

other formality upon importation.

Details and adjustments that shall be included in VAT return

10. (1)The VAT return shall show the VAT identification number referred to in

item 7 and, for each Member State of consumption in which VAT is due, the total

value, exclusive of VAT, of distance sales of goods imported from third territories or

third countries for which VAT has become chargeable during the tax period and the

total amount per rate of the corresponding VAT. The applicable rates of VAT and the

total VAT due shall also be indicated on the return.

(2) Where any amendments to the VAT return are required after its submission,

such amendments shall be included in a subsequent return within three (3) years of

the date on which the initial return was required to be submitted pursuant to item 9.

T h a t s u b s e q u e n t VAT r e t u r n s h a l l i d e n t i f y t h e r e l e v a n t M e m b e r St a t e o f

consumption, the tax period and the amount of VAT for which any amendments are

required.

Reporting currency

11. The VAT return shall be made out in euro.

If the supplies have been made in other currencies, the taxable person making use

of this special scheme or his intermediary shall, for the purposes of completing the

VAT return, use the exchange rate applying on the last date of the tax period. The

conversion shall be made by applying the exchange rates published by the European

Central Bank for that day, or, if there is no publication on that day, on the next day of

publication.

Payment of the tax

12. The taxable person making use of this special scheme or his intermediary

shall pay the VAT, making reference to the relevant VAT return at the latest at the

expiry of the deadline by which the return shall be submitted.

Payment shall be made to a bank account denominated in euro, designated by the

Commissioner.

Deduction of input tax

13. The taxable person making use of this special scheme may not, in respect of

his taxable activities covered by this special scheme, deduct VAT incurred in the

Member States of consumption pursuant to Article 168 of Council Directive 2006/

112/EC. Notwithstanding Article 1(1) of Directive 86/560/EEC and Article 2(1) and

Article 3 of Directive 2008/9/EC, the taxable person in question shall be refunded in

accordance with those Directives. Article 2(2) and (3) and Article 4(2) of Directive

86/560/EEC shall not apply to refunds relating to goods covered by this special

scheme.

If the taxable person making use of this special scheme is required to be registered

in a Member State for activities not covered by this special scheme, he shall deduct

VAT incurred in that Member State in respect of his taxable activities which are

covered by this special scheme in the VAT return that shall be submitted pursuant to

Article 250 of Council Directive 2006/112/EC.

Records

14. (1)The taxable person making use of this special scheme shall keep records

of the transactions covered by this special scheme. An intermediary shall keep

records for each of the taxable persons he represents. Those records shall be

s u ff i c i e nt l y d e t a il e d t o en a bl e t h e t a x a ut h o r it i e s o f th e M e m ber State o f

consumption to verify that the VAT return is correct.

(2) The records referred to in sub-item (1) shall be made available electronically

on request to the Member State of consumption and to the Commissioner.

Those records shall be kept for a period of ten (10) years from the end of the year

during which the transaction was carried out.

Part Eight

Substituted by

L.N. 226 of 2020.

Special arrangements for declaration and payment of import VAT

Permission to use the special arrangement

1. Where, for the importation of goods, except goods subject to excise duties,

in consignments of an intrinsic value not exceeding one-hundred and fifty euro

(€150), the special scheme in Section 4 of Part Seven of this Schedule is not used,

the Commissioner shall permit the person presenting the goods to Customs on behalf

of the person for whom the goods are destined within Malta to make use of special

arrangements for declaration and payment of import VAT in respect of goods for

which the dispatch or transport ends in Malta.

Liability and collection of the tax

2. (1)For the purpose of this special arrangement, the following shall apply

(a) the persons for whom the goods are destined shall be liable for the

payment of the VAT;

(b) the person presenting the goods to Customs in Malta shall collect the

VAT from the person for whom the goods are destined and effect

payment of such VAT.

(2) The Commissioner shall establish an administrative procedure to be

followed by the person presenting the goods to Customs by which that person should

take appropriate measures to ensure that the correct tax is paid by the person for

whom the goods are destined.

Reporting, payment and records

3. (1)The person presenting the goods to Customs under this special

arrangement shall report electronically the VAT collected from the persons for whom

the goods are destined in a monthly declaration. The declaration shall include the

total VAT collected during the relevant calendar month.

(2) The Commissioner shall require that the VAT referred to in sub-item (1) be

payable monthly by the deadline for payment applicable to the payment of import

duty.

(3) The persons making use of this special arrangement shall keep records of the

transactions covered by this special arrangement for a period of at least three (3)

years and that period shall start to run from the end of the year in which the customs

declarations for release for free circulation are accepted. Those records shall be

sufficiently detailed to enable the Commissioner or the Comptroller of Customs to

verify that the VAT declared is correct and be made available electronically on

request to the Commissioner or the Comptroller of Customs as the case may be.

Part Nine*

Added by

L.N. 348 of 2017.

Vouchers

Interpretation

1. In this part

"voucher" means an instrument where there is an obligation to accept it as

consideration or part consideration for a supply of goods or services and where the

goods or services to be supplied or the identities of their potential suppliers are

either indicated on the instrument itself or in related documentation, including the

terms and conditions of use of such instrument;

"single-purpose voucher" means a voucher where the place of supply of the goods

or services to which the voucher relates, and the VAT due on those goods or services,

are known at the time of issue of the voucher;

*

Comes into force on 1st January, 2019.

"multi-purpose voucher" means a voucher, other than a single-purpose voucher.

Single-purpose voucher

2. (1) Each transfer of a single-purpose voucher made by a taxable person

acting in his own name shall be regarded as a supply of the goods or services to

which the voucher relates. The actual handing over of the goods or the actual

provision of the services in return for a single-purpose voucher accepted as

consideration or part consideration by the supplier shall not be regarded as an

independent transaction.

(2) Where a transfer of a single-purpose voucher is made by a taxable person

acting in the name of another taxable person, that transfer shall be regarded as a

supply of the goods or services to which the voucher relates made by the other

taxable person in whose name the taxable person is acting.

(3) Where the supplier of goods or services is not the taxable person who, acting

in his own name, issued the single-purpose voucher, that supplier shall however be

deemed to have made the supply of the goods or services related to that voucher to

that taxable person.

Multi-purpose voucher

3. (1) The actual handing over of the goods or the actual provision of the

services in return for a multi-purpose voucher accepted as consideration or part

consideration by the supplier shall be subject to VAT pursuant to article 4 of the

Value Added Tax Act, whereas each preceding transfer of that multi-purpose voucher

shall not be subject to VAT.

(2) Where a transfer of a multi-purpose voucher is made by a taxable person

other than the taxable person carrying out the transaction subject to VAT pursuant to

paragraph (1) of this item, any supply of services that can be identified, such as

distribution or promotion services, shall be subject to VAT.

Taxable value

4. Without prejudice to item 1 of the Seventh Schedule to the Value Added Tax

Act, the taxable amount of the supply of goods or services provided in respect of a

multi-purpose voucher shall be equal to the consideration paid for the voucher or, in

the absence of information on that consideration, the monetary value indicated on

the multi-purpose voucher itself or in the related documentation, less the amount of

VAT relating to the goods or services supplied.

(1) Any person who is not registered under article 10 or 12

and who intends to make an intra-community acquisition of a new

means of transport shall give notice thereof to the Commissioner by

not later than the date of that acquisition.

(2) Any person who is not registered under article 10 and who

intends to make an intra-community supply of a new means of

transport shall give notice thereof to the Commissioner by not later

than the date of that supply.

(3) Any taxable person or non-taxable legal person who is not

registered under article 10 or 12 and who intends to make an intra-

community acquisition of excise goods shall give notice thereof to

the Commissioner by not later than the date of that acquisition.

(4) A notice to the Commissioner under this article shall be

given with respect to each transaction to which this article applies

on such form as the Minister may by regulations prescribe.

Amended by

L.N. 22 of 1999;

[Article 2]

L.N. 30 of 1999;

L.N. 223 of 1999;

Territories of the Community

L.N. 271 of 2000;

L.N. 149 of 2001;

L.N. 234 of 2001.

Substituted by

X. 2003.47.

Amended by

L.N. 477 of 2020.

1. Subject to the other provisions of this Schedule, "Member State" means the

area of application of the Treaty establishing the European Economic Community as

defined in respect of that State in Article 299 of that Treaty excluding, with respect

to the States listed in the Column One of the Table in this item, the territories listed

in the Second Column

Column One

Column Two

Excluded Territories

Federal Republic of Germany

The Island of Heligoland

The territory of Busingen

Finland

Aland Islands

French Republic

The overseas departments

Hellenic Republic

Mount Athos

Kingdom of Spain

Ceuta

Melilla

The Canary Islands

Republic of Italy

Livigno

Campione d’Italia

The Italian waters of Lake Lugano

2. Notwithstanding the foregoing provisions, Northern Ireland, the United

Kingdom Sovereign Base Areas of Akrotiri and Dhekelia and the Principality of

Monaco shall be treated as territories of Member States and, subject to the following

conditions, transactions originating in or intended for

(a) Northern Ireland shall be treated as originating in or intended for a

Member State where the transactions consist of supplies of goods. For

the purpose of the "value added tax identification number" as defined in

article 2(1) of the Act, the prefix "XI" shall be used for Northern

Ireland;

(b) the United Kingdom Sovereign Base Areas of Akrotiri and Dhekelia

shall be treated as transactions originating in or intended for Cyprus;

and

(c) the Principality of Monaco shall be treated as originating in or intended

for the French Republic.

SIXTEENTH SCHEDULE

Added by

X. 2003.47.

[Article 2]

Substituted by

L.N. 536 of 2010.

Excise Goods

"Excise goods" means products under any of the following descriptions in so far

as they are subject to excise duty in terms of the Excise Duty Act

(a) energy products including mineral oils;

(b) alcohol and alcoholic beverages;

(c) manufactured tobacco

Provided that gas supplied through a natural gas system situated within the territory of

the Community or any network connected to such a system shall not fall under the

description of excise goods.

Every taxable person or non-taxable legal person who is

not registered under this Part shall supply any such information

relating to the date of the commencement or cessation of his

activity, the nature of that activity and the transactions made in the

course or furtherance thereof as may be prescribed.

(1)

The Commissioner shall allocate a tax period to

every person registered under articles 10, 11, 11A and 12.

(2)

Except as otherwise provided in this article, a tax period

means a period of three (3) calendar months commencing on the first

day immediately following the end of the preceding tax period.

(3)

The Minister may by regulations prescribe in respect of such

class or classes of persons as may be specified in the said regulations a

tax period of either more or less than three (3) months.

(4)

The first tax period of a person registered under articles 10

or 12 shall commence on the date that such person is registered in

accordance with the said articles, and end on such date as may be

determined by the Commissioner

Provided that such a period shall not exceed one (1) year.

(5)

When, during a tax period of a person, his registration under

articles 10 or 12 is cancelled, such period shall end on the last day of

the month in which that cancellation is made and shall be the last tax

period of the said person, saving the allocation of a new tax period to

that person should he be subsequently registered again under the said

articles 10 or 12.

(6)

The Commissioner may by means of a notice served on a

person registered under articles 10 or 12 in any particular case vary

any tax period for such person in such manner as may be specified in

the said notice.

(7) Notwithstanding the other provisions of this article, the

relevant provisions relating to the tax periods of a person registered

under articles 11 and 11A to the extent provided in the Sixth Schedule

shall apply to persons registered under those articles.

PART IV

Determination and Payment of the Tax

The taxable value of supplies, intra-community

acquisitions and importations shall be established in the manner

laid down in the Seventh Schedule.

(1) The tax chargeable on every taxable supply, other than

a supply referred to in sub-article (2), shall be at the rate of

eighteen per cent of the taxable value of the supply.

(2) The tax chargeable on every taxable supply specified in the

Eighth Schedule shall be at such rate or rates, not being higher than

eighteen per cent or lower than five per cent of the taxable value of

the supply, as specified in that Schedule.

(3) The tax chargeable on every taxable intra-community

acquisition of goods shall be that applicable to the supply of like

goods in terms of the foregoing provisions of this article.

(4) The tax chargeable on every taxable importation, other than

an importation referred to in sub-article (5), shall be at the rate of

eighteen per cent of the taxable value of the importation.

(5) The tax chargeable on every taxable importation as may be

specified in the Eighth Schedule shall be at such rate or rates, not

being higher than eighteen per cent or lower than five per cent of

the taxable value of the importation, as may specified in that

Schedule.

(1) Saving the other provisions of this article -

(a) the payment of the tax on a taxable supply shall be a

liability of the person who makes the supply;

(b) the payment of the tax on a taxable acquisition shall be

a liability of the person who makes the acquisition;

(c) the payment of the tax on a taxable importation shall

be a liability of the importer.

(2) The payment of the tax on a taxable supply made by a

person who is not established in Malta and who is not registered

under article 10 to a person established in Malta shall be a liability

of the person to whom the supply is made if the supply is -

(a) a supply of goods made to a taxable person registered

under article 10 or 12 or to a non-taxable legal person

registered under article 12 who is identified as such on

a tax invoice for that supply, where

(i)

the person who supplies the goods is identified

for value added tax purposes in another Member

State and has made an exempt intra-community

acquisition of those goods in Malta for the

purpose of that supply; and

(ii) the goods acquired under the said intra-

community acquisition were transported from a

Member State, other than the State where the

taxable person who made the supply is so

identified, to the person to whom the supply is

made; and

(iii) the supplier designates the person to whom the

supply is made as the person liable to pay the tax

on that supply; or

(b) a supply of services made to a taxable person or a non-

taxable legal person identified for purposes of Value

Added Tax, in terms of item 2.(a) in Part Two of the

Third Schedule; or

(c) a supply of goods or of services, other than a supply to

which paragraph (a) or (b) refers, made to a taxable

person registered under article 10 or article 12, or to a

non-taxable legal person identified for purposes of Value

Added Tax

Provided that, for the purposes of this sub-article, a taxable

person who has a fixed establishment within Malta shall be

regarded as a taxable person who is not established within Malta

when the following conditions are met

(i)

he makes a taxable supply of goods or of

services within Malta;

(ii) an establishment which the supplier has within

Malta does not intervene in that supply.

(3) When a person mentions the tax on an invoice or a

document serving as an invoice for a supply he shall, unless he is

the person liable for the tax in terms of the foregoing provisions of

this article, be jointly and severally liable for the tax on that supply

together with that person.

(4) A person who is a representative of another person in terms

of article 66 shall, within the limits set out in that article, be jointly

and severally liable for the tax together with the person of whom he

is a representative.

(1) Every person registered under article 10 shall pay to

the Commissioner by not later than the date on which he is required

to furnish a tax return for a tax period an amount equivalent to the

excess, if any, of the output tax for that period over the deductions

that he has a right to make in accordance with article 23: Provided

that that person may set off any excess tax credit for a previous tax

period, that has not been refunded or become refundable in terms of

article 24, against any tax payable in accordance with this sub-

article.

(2) Every person liable for the payment of the tax in

accordance with article 20(1) or (3), other than tax payable in

accordance with sub-article (1) of this article, shall pay that tax to

the Commissioner by not later than the fifteenth day of the month

following that during which it becomes chargeable.

(3) Every person liable for the payment of the tax in

accordance with article 20(2), other than tax payable in accordance

with sub-article (1) of this article, shall pay that tax to the

Commissioner by not later than the fifteenth day of the second

month next following either the date of invoice or of the month

during which the consignment or the supply of services is received,

as the case may be, whichever is the earlier.

(4) Interest shall be due on any tax which is not paid by the

date on which it becomes payable at a rate which the Minister shall,

from time to time, by regulations prescribe for each month or part

thereof during which that tax remains unpaid or at such other rate as

may be prescribed

Provided that the running of interest on any amount of tax

due which is the merit of an appeal before the Tribunal, shall be

suspended for the period that exceeds two months from the date of

the last sitting of the Tribunal relating to such appeal and the date

when a decision is given by the Tribunal or a final judgement is

delivered by the Court of Appeal (Inferior Jurisdiction), as the case

may be

Provided further that the Minister may by regulations

prescribe conditions under which part or all the interest incurred

under this sub-article may be remitted. Such regulations may also

make provision for the remission of any interest due under the

Value Added Tax Act, 1994, and under the Customs and Excise Tax

Act.

(4A) Notwithstanding the other provisions of this article, no

interest shall be due where a return required to be furnished under

a r t i c l e 2 7 i s f u r n i s h e d i n a n e l e c t r o n i c f o r m a t t h r o u g h th e

established web portal designated for the purpose by the

Commissioner, together with payment of the tax due on the return,

not later than seven days following the date on which the tax

becomes payable under the provisions of this Act.

(4B) Notwithstanding the other provisions of this article,

interest in a particular tax period shall cease to accrue where the

total amount of payments appropriated to that tax period in terms of

article 67 is equivalent to or exceeds the amount of tax payable for

that tax period.

(5) The payment of the tax shall be accompanied by the

delivery to the Commissioner of the respective form as the Minister

may by regulations prescribe

Provided that tax on importations shall be payable to the

Commissioner and shall be made at such place and be accompanied by

such forms as the Commissioner may direct.

(1) The output tax of a person registered under article 10

is the tax on supplies and on intra-community acquisitions that

becomes chargeable during that period and for which that person is

liable in terms of article 20(1) and (2).

(2) The input tax of a taxable person is the tax that becomes

chargeable on -

(a) supplies made to him,

(b) intra-community acquisitions made by him, and

(c) importations made by him,

to the extent that the supplies so made and the goods so acquired or

imported have been or are intended to be wholly used by him in the

course or furtherance of his economic activity.

(3)

Subject to sub-article (5) -

(a) the input tax credit for a tax period of a person

registered under article 10 is an amount equivalent to

so much of the input tax of that person that becomes

chargeable during that period as is attributable to

supplies made or intended to be made by him, being

supplies to which sub-article (4) applies;

(b) the input tax credit for the last tax period of a person

whose registration under article 10 has been cancelled

is an amount equivalent to so much of the input tax of

that person that becomes chargeable during that period

as is attributable to supplies made by him up to the end

of that period, being supplies to which sub-article (4)

applies.

(4)

This sub-article applies to

(a) taxable supplies;

(b) exempt with credit supplies;

(c) supplies which take place outside Malta which would,

if made in Malta, be treated under the provisions of

this Act as taxable supplies or as exempt with credit

supplies or supplies taxed outside Malta which if made

in Malta would have been treated as exempt without

credit supplies;

(d) operations exempt from VAT, relating to

(i)

supplies by persons licensed under the Insurance

Business Act or the Insurance Distribution Act,

of insurance and reinsurance services, including

related transactions, in respect of which they are

so licensed;

(ii) the granting and negotiation of credit and the

management of credit by the person granting it;

(iii) the negotiation of or any dealings in credit

guarantees or any other security for money and

the management of credit guarantees by the

person who is granting the credit;

(iv) transactions, including negotiation, concerning

deposit and current accounts, payments,

transfers, debts, cheques and other negotiable

instruments, but excluding debt collecting and

factoring;

(v) transactions, including negotiation, concerning

currency, bank notes and coins normally used as

legal tender;

(vi) transactions, including negotiation, excluding

management and safekeeping, in shares, interest

in companies or associations, debentures and

other

securities,

excluding

documents

establishing title to goods,

when the customer is established outside the Community or when

those operations are directly linked with goods to be exported to a

country outside the Community.

(5) The right to an input tax credit, the amount of the credit and

the manner in which input tax is attributable to supplies are subject

to the conditions, limitations, revisions and adjustments set out in

the Tenth Schedule.

Every person registered under article 10 who furnishes a

tax return for a tax period shall have the right to deduct from the

output tax for that period -

(a) the input tax credit for that period;

(b) any other deductions to which he may be entitled for

that period in accordance with the Tenth Schedule.

(1) Saving the other provisions of this Act, when the

deductions allowable to a person registered under article 10 for a

tax period exceed the output tax of that person for that period the

excess shall be an excess credit of that person for that period.

(2)

The amount of excess credit of a person registered under

article 10 for a tax period shall, to the extent that it is not set off

against any amount due by that person to the Commissioner in

accordance with article 21(1), be a refund payable to such person by

not later than five (5) months from the expiration of the time allowed

for the furnishing of the tax return for that tax period or from the day

on which the said return has been furnished to the Commissioner,

whichever is the later

Provided that where a person to whom a refund is payable in

terms of this sub-article has, by the date the refund claim is due, failed to

submit a tax return, or return of income in respect of the year of

assessment 1999 or any subsequent years of assessment by the date

required to be submitted in accordance with the provisions of the

Income Tax Management Act, and such failure persists until the date

such refund becomes payable, any such refund shall not be paid to such

person and shall be withheld by the Commissioner until such time as the

said tax return or return of income is submitted; and provided further

that notwithstanding any other provisions of this Act, no interest shall be

due by the Commissioner in respect of the period during which the said

refund was withheld on account of failure to submit a tax return or return

of income for the purposes of the Income Tax Management Act

Provided further that notwithstanding the foregoing provisions

of this sub-article, the Commissioner may set off any amount of excess

credit of a person, to the extent that it is not set off against any amount

due by that person to the Commissioner in accordance with article 21(1),

against any amounts due by that person to the Commissioner in

accordance with any of the provisions of the revenue acts.

(3) Interest shall be due to a person to whom a refund is due in

accordance with this article at the rate specified in or prescribed in

terms of article 21(4) from the date by which the refund is payable

in accordance with this article until the date when it is paid or when

a cheque or draft for the payment thereof is given or posted to that

person by the Commissioner

Provided that no interest shall be due for any period during

which such person fails to produce information and, or

documentation as may be requested by the Commissioner, for the

verification of the amount claimed.

(4) For the purpose of any such verifications as he may

consider necessary to ascertain the amount refundable, the

Commissioner may, by notice in writing to the person to whom a

refund is due, extend the time limit referred to in sub-article (2) by

not more than twelve months: Provided that the running of interest

on the said refund shall not be meanwhile suspended.

(1) A person who is not registered or liable to be

registered under article 10 but who is treated as a taxable person by

reason of the fact that he makes an exempt supply of new means of

transport may claim a refund of the tax charged on the supply to

him or the intra-community acquisition or importation by him of

that new means of transport: Provided that the refund shall not

exceed the tax that would be chargeable if the supply by him of the

new means of transport in question were a taxable supply.

(2) A taxable person who is not registered or liable to be

registered under article 10 and who is not established in Malta but

is established in another Member State may claim a refund of his

input tax.

(3) A taxable person who is not registered or liable to be

registered under article 10 and who is not established in the

Community may claim a refund of his input tax if, in terms of the

laws of the country in which he is established, a taxable person

established in Malta would be entitled to a comparable benefit with

respect to value added tax or similar taxes levied in that country.

(4) When goods transported from a third territory are imported

into Malta by a non-taxable legal person, and when the place of

arrival of the goods transported is a Member State other than Malta,

the importer may claim a refund of the tax on the importation of

those goods if he establishes that his acquisition of those goods was

subject to value added tax in that other Member State.

A claim for a refund referred to in article 25 shall be made

on such form as the Minister may by regulations prescribe and shall

be made within such time, be accompanied by such documents and

information and be subject to such limitations and conditions as

may be prescribed.

PART V

Returns, Assessments, Penalties and Appeals

(1) Every person registered under article 10 shall furnish

the Commissioner with a tax return for every tax period by not later

than the fifteenth day of the second month following the month

during which that tax period ends.

(2) Every person whose registration under article 10 is

cancelled shall provide the Commissioner with a tax return relating

to the last tax period within thirty (30) days from the date on which

he is served with a notice referred to in article 13(5) or within such

longer period as may be specified in the said notice

Provided that this sub-article shall not apply when the

registration under article 10 is cancelled in the circumstances

mentioned in article 11(4).

(3) A tax return furnished by a person registered under article

10 shall contain a declaration of the output tax, the input tax and

any other declarations and particulars for that tax period that are

required under this Act and shall be furnished either on such form

as the Minister may by regulations prescribe or in an electronic

format through the established web portal designated for the

purpose by the Commissioner

Provided that the Minister may by regulations prescribe

conditions whereby a tax return shall only be furnished in an

electronic format.

(4) A tax return shall not be deemed to have been furnished

unless it is full and complete in all material aspects.

(1) Subject to sub-article (2), a person registered under

article 10 who has made an incorrect declaration in a tax return

furnished to the Commissioner for a tax period may correct the

declaration by the delivery of such form as the Minister may by

regulations prescribe. The provisions of article 27(4) with respect

to tax returns shall apply mutatis mutandis to the delivery of the

said form.

(2) An incorrect declaration in a tax return may be corrected by

means of an adjustment in a subsequent tax return without the need

for the delivery of a form as required by sub-article (1) to the extent

allowed by and in the manner provided in the Eleventh Schedule,

and when a correction has been so made the tax return shall not be

deemed, with respect to the matters so corrected, to have contained

any understatement or overstatement for the purpose of article

37(2).

(3) Notwithstanding the other provisions of this article, where

a provisional assessment made in accordance with article 32(1) and

(2) is served to a person, any tax return furnished to the

Commissioner to which such an assessment relates may not be

corrected after being served with that provisional assessment, until

such time an assessment in accordance with article 32(3) and (4) is

made or until such time the provisional assessment is cancelled by

the Commissioner

Provided that this shall not prejudice the person’s right to

cooperate with the Commissioner in order for the assessment made

in accordance with article 32(3) to contain such variations as may

be agreed to by the said person.

(4) Notwithstanding the other provisions of this article, when a

correction is required to be made to a tax return in accordance with sub-

article (1), after an assessment has been made in accordance with article

32(3) and (4), any such correction shall be subject to the approval of the

Commissioner.

When a person registered under article 10 has furnished the

Commissioner with a tax return for a tax period, the output tax and

the deductions of that person for that period shall, except as

provided in article 36, be deemed to be the output tax and the

deductions declared in that return as adjusted by any adjustment

made in accordance with article 28: Provided that any such

adjustment shall not give rise to any reduction in the tax liability or

a tax credit or refund with respect to that tax period if it is made

after the expiration of six years from the end of the year in which

that tax period ends.

(1)

Every person registered under articles 11 and 11A

shall furnish the Commissioner with the periodical declarations

relating to his economic activity by such means and at such intervals

as may be specified in the Sixth Schedule.

(2)

Every taxable person registered under article 10 shall

submit a recapitulative statement electronically through the

established web portal designated by the Commissioner for this

purpose and include any information requested therein at such

intervals as the Minister may by regulations prescribe for the

following supplies

(a)

intra-Community supplies of goods exempt in

accordance with items 3(1) and 3(4) of Part One of the Fifth

Schedule;

(b)

the supply of goods which were supplied to him

by way of intra-Community acquisition of goods which satisfy

the conditions referred to in item 2(2) of Part Three of the Third

Schedule;

(c)

services, other than services that are exempted

from VAT in the Member State where the transaction is taxable,

and for which the recipient is liable to pay the tax made to

taxable persons and non-taxable legal persons identified for

purposes of value added tax.

(3) Every taxable person and non-taxable legal person shall make

such statements and shall produce such information and documents as

may be reasonably required by the Commissioner for any purpose of

this Act or as may be prescribed.

A person registered under article 12 shall furnish the

Commissioner with a notice of payment in terms of article 21(5) and

declarations of his intra-community acquisitions and purchases made

for which the customer is liable for the payment of the tax pursuant to

articles 20(2)(b) and 20(2)(c) on such form as the Minister may be

regulations prescribe. The provisions of article 27(4) with respect to

tax returns shall apply mutatis mutandis to the delivery of the said

form.

(1) When a person liable to furnish a tax return under

article 27 for a tax period does not furnish that return the

Commissioner may make an assessment of the output tax and the

deductions of that person for that period and of the administrative

penalty to which that person became liable and serve that

assessment on that person at any time after the expiration of the

time allowed in terms of this Act for the furnishing of that return

and by not later than six years from the end of the said tax period.

(2) An assessment made for a tax period of a person in virtue of

this article shall not relieve that person from his obligation to

furnish a tax return for that period and from his liability to any or to

further administrative penalties in accordance with the relevant

provisions of this Act.

(3) When a tax return for a tax period is furnished after an

assessment has been made in accordance with sub-article (1) the

Commissioner may cancel that assessment without prejudice to his

power to make further assessments in terms of the other provisions

of this Act.

(4) The cancellation of an assessment as aforesaid shall not

relieve the person who has been in default from his liability to an

administrative penalty in accordance with the other provisions of

this Act.

(1) When the Commissioner has reason to believe that a

tax return furnished by a person registered under article 10 for a tax

period does not contain a full and correct statement of the matters

required to be declared in that return he may make a provisional

assessment and serve that provisional assessment on that person by

not later than six years from the end of the said tax period or from

the date in which the tax return for that tax period is submitted,

whichever date is the later

Provided that where the provisional assessment refers to the

adjustment relating to input tax on capital goods mentioned in the

Tenth Schedule, it shall be served by not later than six years from

the end of the adjustment period mentioned in the said schedule

Provided further that, where a person makes a correction in

terms of article 28(1), the six year period in which the Commissioner

may make a provisional assessment as provided for in this sub-article

shall start to run from the date on which the Commissioner receives

the request for the correction.

(2) A provisional assessment shall indicate clearly that it is a

provisional assessment and that it may be followed by an

assessment within the time limits specified in sub-article (3). Save

a s af o r es ai d a pr o v i si on a l as se s s m e nt s h a l l c o n ta i n a ll t he

particulars that are required to be given in an assessment and such

further particulars as the Commissioner may deem appropriate.

(3) After the expiration of a period of not less than thirty days

and not more than six months from the service on a person of a

provisional assessment in respect of a tax period the Commissioner

may make an assessment of the output tax and the deductions of

that person for that period and of the administrative penalty to

which that person became liable and serve that assessment on that

person.

(4) The assessment made in virtue of sub-article (3) may not

contain any variations to the amounts specified in the relative

provisional assessment except for -

(a) variations requested by or agreed to by the said person;

(b) variations consisting in the substitution for amounts

shown in the provisional assessment of amounts that

are equal or closer to those declared in the relative tax

return.

(5) The Commissioner may, for the purposes of this Act, cancel

any provisional assessment raised by him, and issue a fresh

provisional assessment, and such cancellation shall be without

prejudice to the raising of a fresh provisional assessment required

to be raised under this Act in replacement of the provisional

assessment so cancelled which shall be deemed not to have been

raised.

Such fresh provisional assessment has to be raised within

the time limit specified in sub-article (1).

(1) When the Commissioner has reason to believe that a

person has become liable to an administrative penalty with respect

to anything made by him during any period in which he was

registered under article 11 he may make an assessment of that

penalty and serve that assessment on that person within six years

from the end of that period.

(2) When a person who is not registered under article 10 and

who is liable to pay tax under this Act does not pay the tax within

the time allowed in terms of this Act for the said payment, the

Commissioner may make an assessment of the tax payable by that

person.

(3) When a person who is not registered under article 10 or 11

becomes liable to an administrative penalty under this Act the

Commissioner may make an assessment of the administrative

penalty to which that person became liable and serve that

assessment on that person at any time within six years from the date

on which that administrative penalty was payable.

(1) An assessment made in virtue of article 31, article 32

or article 33 shall be made on such form and contain such further

particulars as the Commissioner may deem appropriate or as may

be prescribed.

(2) An assessment may be made by reference to such

information, estimations or criteria as the Commissioner may, in

his judgement, deem appropriate, and the Commissioner may also

attribute the taxable value of taxable supplies, the output tax, the

deductions allowable and the tax payable or excess credit resulting

in respect of a number of tax periods to a particular tax period,

provided that the person subject to the said aggregated assessment

shall not be made liable to more tax, administrative penalty or

interest than he would have been liable to had the amounts been

attributed to particular tax periods.

The power to make an assessment includes the power to

make an additional or a revised assessment within the same time

limits and subject to the same provisions applicable to an original

assessment: provided that the Commissioner may not reopen any

matter that has been decided on appeal.

Where an assessment is made on any person any amount of

tax, deductions or administrative penalty assessed in that

assessment shall, except if and to the extent that the assessment is

cancelled or revised, be deemed for any of the purposes of this Act

to be and to have always been the tax, the deductions and the

administrative penalty properly due and allowable with respect to

the tax period or the transactions to which that assessment refers.

(1) Saving the provisions of sub-article (2), when a tax

return furnished by a person registered under article 10 for a tax

period contains an understatement of the output tax or an

overstatement of the deductions for that period, that person

becomes liable to an administrative penalty in an amount

equivalent to twenty per cent of the total of -

(a) the excess, if any, of the correct amount of output tax

over the output tax as declared in the return; and

(b) the excess, if any, of the deductions as declared in the

return over the correct amount of the deductions.

(2) Where a person corrects an understatement or

overstatement as is referred to in sub-article (1) in accordance with

the provisions of article 28(1) before he is served with a provisional

assessment for that period, that person becomes liable to an

administrative penalty in an amount equivalent to ten per cent of

the total of -

(a) the excess, if any, of the correct amount of output tax

over the output tax as declared in the return; and

(b) the excess, if any, of the deductions as declared in the

return over the correct amount of the deductions.

(3) Where a tax return for a tax period furnished to the

Commissioner by a person registered under article 10 who only

supplies goods or services listed under Part One of the Fifth Schedule

to this Act, does not contain a full and correct statement of the matters

required to be declared by that person in that return and to the extent

that that person does not correct such an understatement or

overstatement in accordance with the provisions of article 28 before he

is served with an assessment for that period he shall, unless that person

has in virtue of that default become liable to a higher administrative

penalty under the other provisions of this article, be liable to an

administrative penalty of one hundred and fifty euro (€150).

(4) Where, during the course of an investigation, a person co-

operates with the Commissioner, accepts an agreement and within

one month from the signing of the agreement pays the amount of

tax due, the agreed administrative penalty and the interest due, that

person shall be liable to an administrative penalty in an amount

equivalent to 10 per cent of the amount of tax due.

Where a notice of payment furnished by a person

registered under article 12 contains an understatement of the tax

payable in accordance with articles 21(2) and 21(3) or where the

Commissioner makes an assessment of the tax payable by that

person in terms of article 33(2), that person shall become liable to

an administrative penalty in an amount equivalent to twenty per

cent of the understated tax payable or the assessed tax.

(1) Any person registered under article 10 who, being

required to furnish a tax return for a tax period, does not furnish

that return within the time laid down in the relevant provisions of

this Act shall be liable to an administrative penalty in an amount

equivalent to the higher of -

(a) one per cent of the excess, if any, of the output tax

over the deductions, disregarding any excess credit

brought forward from a previous tax period, as

declared in the return; and

(b) twenty euro (€20),

for every month or part thereof that elapses from the date by which

the tax return should have been furnished in accordance with this

Act and the date when it is furnished to the Commissioner

Provided that where the tax payable is less than two hundred

and fifty euro (€250), such administrative penalty shall not exceed the

equivalent of the tax payable to the nearest euro or fifty euro (€50),

whichever is the greater, and it shall not exceed two hundred and fifty

euro (€250) in all other cases.

(2)

Any person who

(a)

being required to furnish a declaration in terms of

article 30(1) or article 30A, does not furnish such declaration

within the time stipulated in the relevant provisions of this Act

shall be liable to an administrative penalty of ten euro (€10) for

every month or part thereof that elapses from the date by which

the declaration should have been furnished in accordance with

this Act and the date when it is actually furnished to the

Commissioner

Provided that such administrative penalty shall in no case

exceed one hundred and twenty euro (€120) for each such

declaration; and

(b) being required to furnish a recapitulative statement in

terms of sub-article (3) of article 30, does not furnish

that statement within the time laid down in the relevant

provisions of this Act shall be liable to an

administrative penalty of fifty euro (€50) for every

month or part thereof that elapses from the date by

which the statement should have been furnished in

accordance with this Act and the date when it is

furnished to the Commissioner

Provided that such administrative penalty shall in no case

exceed six hundred euro (€600) for each such statement; and

(c) being required to furnish any information in terms of

article 55A, does not furnish that information within

the time laid down in the relevant provisions of this

Act shall be liable to an administrative penalty of fifty

euro (€50) for every month or part thereof that elapses

from the date by which the information should have

been furnished in accordance with this Act and the

date when it is furnished to the Commissioner

Provided that such administrative penalty shall in no case

exceed six hundred euro (€600) for every time such information is not

provided.

(1) Any person who, being required to apply for

registration under article 10, does not make such an application

within the time laid down in the relevant provisions of this Act

shall be liable to an administrative penalty in an amount equivalent

to the higher of -

(a) one per cent of the excess, if any, of the output tax

over the deductions for the first tax period following

the registration; and

(b) twenty euro (€20),

for every month or part thereof that elapses from the date on which

the application should have been made and the earlier of the date on

which the application registration is furnished to the Commissioner

and the date when that person is registered by the Commissioner

Provided that where the excess, if any, of the output tax over

the deductions for the first tax period following registration is two

thousand euro (€2,000) or less, such administrative penalty shall not

exceed two hundred and fifty euro (€250), and where the excess of the

output tax over the deductions for the first tax period following

r e g i s t r a ti o n i s m o r e t ha n t w o t ho u s a n d e u r o ( € 2 , 0 0 0 ) su c h

administrative penalty shall not exceed twenty per cent of such excess.

(2) Any person who, being required to apply for registration

under article 12, does not make such an application within the time

laid down in the relevant provisions of this Act shall be liable to an

administrative penalty of the higher of -

(a) one per cent of the tax chargeable on the intra-

community acquisitions or the services received or both

such intra-community acquisitions and services received,

in respect of which he is required to make such

application; and

(b) twenty euro (€20),

for every month or part thereof that elapses from the date on which

the application should have been made and the earlier of the date on

which the application is furnished to the Commissioner and the

date when that person is registered by the Commissioner

Provided that where the tax chargeable on the intra-

community acquisitions or the services received or both such intra-

community acquisitions and services received, in respect of which that

person is required to make such application is two thousand euro

(€2,000) or less, such administrative penalty shall not exceed two

hundred and fifty euro (€250), and where the tax chargeable on the

intra-community acquisitions or the services received or both such

intra-community acquisitions and services received, in respect of

which that person is required to make such application is more than

two thousand euro (€2,000) such administrative penalty shall not

exceed twenty per cent of such tax chargeable.

(3) Any person who, being required to give notice or provide

information under articles 13 or 15, does not give that notice or

information within the time stipulated in the relevant provisions of

this Act shall be liable to an administrative penalty of twenty euro

(€20) for every month or part thereof that elapses from the date on

which th e notice or information should have been g iven in

accordance with those articles and the date when such notice or

information is given to the Commissioner

Provided that such administrative penalty shall in no case

exceed two hundred and fifty euro (€250) for each such notice or

information.

Any person registered under article 11 who does not

remain eligible to be so registered and who does not apply for the

cancellation of his registration under article 11 within the time laid

down in the relevant provisions of this Act shall be liable to an

administrative penalty in an amount equivalent to the higher of -

(a) ten per cent of the excess, if any, of the output tax over

the deductions for the first tax period following the

cancellation of his registration under article 11; and

(b) one hundred euro (€100),

for every month or part thereof that elapses from the date on which

the application should have been made in terms of the said

provisions and the earlier of the date on which the application is

furnished to the Commissioner and the date when the registration

under article 11 is cancelled by the Commissioner

Provided that such administrative penalty shall in no case

exceed five hundred euro (€500).

Any administrative penalty to which a person becomes

liable in terms of this Act shall be due and payable by that person

without the need of any assessment to be made with respect thereof,

and any amount of any administrative penalty due by a person shall

not relieve that person from a higher or from a further penalty to

which he may have become or may become liable in terms of the

relevant provisions of this Act.

(1) Notwithstanding the provisions of articles 37 to 41,

both inclusive -

(a) no administrative penalty shall be due by a person for

any default if that person proves that there is a

reasonable excuse for the default;

(b) if a person does not prove that there is a reasonable

excuse for a default, but the Commissioner is of the

view that the default resulted from particular

circumstances that merit a mitigation of the

administrative penalty, he may, in his discretion, remit

part of the administrative penalty for that default;

(c) if the Commissioner is of the view that the default

resulted from a genuine mistake he may remit in whole

or in part the administrative penalty for that default;

(d) no administrative penalty under article 38 shall be due

where a return required to be made in terms of article

27 or a declaration required to be made in terms of

article 30(1) is furnished in an electronic format

through the established web portal designated for the

purpose by the Commissioner, not later than seven

days from the date on which the said return or

declaration should have been submitted under the

provisions of this Act.

(2)

For the purposes of sub-article (1)(a) and (b) -

(a) an insufficiency of funds to pay any tax due; or

(b) when reliance is placed on any other person to perform

any task, the fact of that reliance or any dilatoriness or

inaccuracies on the part of the person relied upon,

shall not constitute a reasonable excuse.

(3) Notwithstanding the provisions of articles 43 and 44, the

use of the Commissioner’s discretion for the purpose of sub-article

(1)(b) and (c) shall not be questioned in any appeal or in any

reference made to the Tribunal.

(4) The Minister may by regulations prescribe other conditions

under which part of, or all, the administrative penalty incurred

under articles 37 to 41 may be remitted. Such regulations may also

make provision for the remission of any administrative penalties

due under the Value Added Tax Act, 1994, and under the Customs

and Excise Tax Act.

Any person aggrieved by an assessment served upon him

may appeal against that assessment to the Tribunal.

If any question arises, other than on an assessment, relating

(a) the registration of a person under this Act or the

cancellation of such a registration;

(b) any tax chargeable on a supply or an acquisition other

than tax assessed in an assessment and any deductions

that may be claimed against such tax;

(c) whether a transaction made or to be made by a person

is a taxable supply or a taxable acquisition or not or

whether an importation of goods made or to be made

by a person is a taxable importation or not;

(d) any tax chargeable on the importation of goods;

(e) the place, the time or the taxable value of a supply or

of an acquisition;

(f)

the amount of deductions allowable to a person

registered under article 10 for any tax period;

(g) any security required by the Commissioner under this

Act;

(h) whether any refund of tax claimed by any person is

due or payable to that person or not;

(i)

any question of law not falling within the foregoing

provisions of this article;

(j)

any matter which, in terms of any provision of this

Act, or of any regulations made under this Act, may be

referred to appeal;

(k) the imposition of any administrative penalty except

where it is imposed as a result of an assessment,

that question may be referred to the Tribunal by any person who

shows to the satisfaction of the Tribunal that he has a direct interest

in that question or by the Commissioner.

There shall be an Administrative Review Tribunal for the

purpose of hearing and determining appeals and references made in

accordance with articles 43 and 44.

The Ninth Schedule to this Act shall apply with respect to

any appeal made or any question referred to the Tribunal, the

composition and competence of the Tribunal, and the regulation of

the procedures of the Tribunal.

(1) Any of the parties to an appeal or to a reference to the

Tribunal who feel aggrieved by the decision of that Tribunal may, by

means of an application which shall be filed within thirty (30) days

from the date of the decision of the Tribunal, appeal against that

decision only on the following questions of law

(i)

where the total amount of tax, administrative penalty,

and interest for the tax period or periods under appeal

up to the date of receipt of the appeal by the Tribunal

is less than one million and one hundred and fifty

thousand euro (€1,150,000), to the Court of Appeal

(Inferior Jurisdiction); and

(ii) where the total amount of tax, administrative penalty,

and interest for the tax period or periods under appeal

up to the date of receipt of the appeal by the Tribunal

is of one million and one hundred and fifty thousand

euro (€1,150,000) or more, to the Court of Appeal.

(2) The board established under article 29 of the Code of

Organization and Civil Procedure may make regulations governing

appeals under this article.

(3) The Minister responsible for justice may by regulations

under this sub-article establish the fees payable in the registry of

the court in relation to the filing of judicial acts in connection with

appeals to the Court of Appeal or to the Court of Appeal (Inferior

Jurisdiction), as the case may be, under this Act

Provided that until fees are so established by the Minister,

the fees contained in Schedule A to the Code of Organization and

Civil Procedure shall apply.

(1) The Tribunal shall be competent to hear and

determine appeals in accordance with the provisions of article 46.

(2) The provisions of the Administrative Justice Act, in so far

as they apply to the Tribunal, shall apply to any proceedings

before the said Tribunal and the words "public administration" in

the said enactment shall be construed as a reference to the

Commissioner.

(3) The provisions of article 25 of the Administrative Justice

Act shall apply to any proceedings pending before the Value Added

Tax Appeals Board, arising out of appeals made under the Value

Added Tax Act, 1994, the Customs and Excise Tax Act, 1997 and

this Act, and any such proceedings shall be assigned to the

Tribunal in terms of the aforesaid article 25 with effect from 1st

April, 2012.

(4) Any pending appeal before the Value Added Tax Appeals

Board constituted under this Act prior to its abolition shall

continue to be heard before the Tribunal and any appeal which

under this Act could be made before the Value Added Tax Appeals

Board shall be made before the Tribunal.

(5) Any appeal pending on 1st April, 2012 before the Court of

Appeal from a decision of the Value Added Tax Appeals Board

shall continue to be heard by that Court

Provided that if the said Court were to annul a decision of

the said Board and remit it back to the said Board, the remittance

shall instead be made to the Tribunal which shall hear and decide

that case accordingly.

(6) The Commissioner shall publish all decisions given by the

Tribunal on points of law.

PART VI

Records and Information

(1) Every taxable person established in Malta shall keep full

and proper records of all transactions carried out in the course or

furtherance of his economic activity.

(2) Every person who is liable to tax on any transaction or who

identifies himself as a person registered under this Act for the

purpose of any transaction shall keep full and proper records of any

such transaction.

(3) Every taxable person and every non-taxable legal person

shall keep full and proper records of all intra-community

acquisitions made by him.

(4) The records referred to in sub-articles (1), (2) and (3) shall

be kept and stored in such manner, contain such details and be

supported by such information, documents and accounts as set out

in the Eleventh Schedule and such records, information, documents

and accounts shall be retained for a period of at least six years from

the end of the year to which they relate, or such other period or

periods as the Minister may, in special cases, by regulations

prescribe

Provided that, where a tax return is furnished after its due

date or, in the case where a person makes a correction in terms of

article 28(1), the six year period provided for in this sub-article

shall start to run from the date on which a tax return is furnished or

the date on which the Commissioner receives a request for the

correction.

(5) The Commissioner may, at any time within the period

specified in sub-article (4), request any person to produce, or may

remove from any person, including a third party, the records,

documents, accounts and electronic data required to be kept by him

in virtue of this article and to make copies thereof

Provided that, if there is evidence that after being requested

by the Commissioner by means of a notice in writing, that such

person failed to produce without any reasonable excuse any

records, documents, accounts and electronic data within thirty days

from the date of service of such notice, such person shall not be

al lowed to produ ce such records, do cu ments, account s and

electronic data at a later stage after the issue of the provisional

assessment or assessments or before the Tribunal or in any Court of

law

Provided further that when reliance is placed on any other

person to perform any task, the fact of that reliance or any delay or

inaccuracy on the part of the person relied upon shall not constitute

a reasonable excuse for the purposes of this sub-article.

(1)

Where any person registered or required to be

registered in accordance with this Act, indicates the price or

consideration payable for goods or services which shall be supplied to

any other person, such price or consideration shall be deemed to be

inclusive of any tax chargeable under this Act.

(2)

Notwithstanding the provisions of sub-article (1), where

(a)

the tax chargeable in accordance with this Act

cannot be determined at the time the price or consideration

payable for a supply is indicated; or

(b)

the supply is made to another person who

identifies himself for the purpose of that supply by means of a

valid value added tax identification number,

and it is specifically and unequivocally indicated that such price or

consideration payable excludes the tax chargeable under this Act, such

chargeable under this Act.

(1) Every person registered under article 10 who makes a

supply, other than an exempt without credit supply, to another

person who identifies himself for the purpose of that supply by

means of a value added tax identification number shall provide that

other person a tax invoice within the time determined in accordance

with the provisions of the Twelfth Schedule.

(2) When there is an application, disposal, transport or use of

goods for which no consideration is charged or paid but which is

deemed in terms of the Second Schedule to be a supply made by a

person for consideration, that person shall, if he is a person

registered under article 10, issue a tax invoice in which he indicates

himself both as the person who made the supply and as the person

to whom the supply is made.

(3) Every taxable person shall issue a tax invoice within the

time stated in sub-article (1) in respect of every distance sale made

by him.

(4) Where a person provides a document to himself which

purports to be a tax invoice in respect of a taxable supply made to

him by a person registered under article 10, that document may,

subject to the provisions of the Twelfth Schedule, be treated as the

tax invoice required to be issued and delivered by the supplier in

terms of this article.

(5) A tax invoice shall be issued in the form and in the manner

and shall contain the particulars set out in the Twelfth Schedule.

(1)Any person who makes any supply, other than a supply

in respect of which a tax invoice is required to be issued in terms of

article 50, shall provide to the person to whom the supply is made

an invoice, receipt or other document which shall be issued in the

form and in the manner and shall contain the details indicated in the

Thirteenth Schedule.

(2) The provisions of sub-article (1) shall not apply to supplies

which are exempt without credit in accordance with Part Two of the

Fifth Schedule other than supplies referred to under sub-item 16(1) of

Part Two of the said Schedule.

(1) A person to whom any tax invoice or other invoice,

receipt or document is provided as required by article 50 or 51

shall, if so requested in accordance with the other provisions of this

Act, produce the said invoice, receipt or other document to the

Commissioner or to any officer authorised by the Commissioner.

(2) Any person who transports goods in the course of an

economic activity, on his own behalf or on behalf of or to third

parties, shall be in possession at any time of an identification

document and a tax invoice or a delivery note or a transport

document showing a description of all the goods being transported,

the value of the goods, the unit quantity, the date of the delivery,

the destination address, the name and address and value added tax

registration number of the supplier and the name and address and

value added tax registration number of the person to whom the

supply is made. In the course of an inspection of the means which

is transporting the goods, a copy of the aforementioned documents

shall upon demand be produced to the Commissioner or to any

other officer authorised by the Commissioner. A person who fails

to produce the documents as required in accordance with the

provisions of this sub-article or whose goods are not found to be in

agreement with the said document, shall be guilty of an offence

against this Act.

The Commissioner shall, for the purpose of ensuring

compliance with the provisions of this Act, have the power -

(a) to enter and inspect any premises where an economic

activity is carried on or suspected to be carried on or

where any goods, assets, books, records or documents

relating to such activity are kept or suspected to be

kept, and to stop, enter and inspect any means which is

transporting goods or any means for the transport of

goods, to direct the delivery of the said means to

another location and to open the said goods to verify

the quantity and value of goods with invoices, books,

records or documents relating to such goods to

determine whether or not value added tax has been

accounted for under the provisions of this Act;

(b) to inspect and to require electronic access to any books,

records, information and documents, including those

contained in any computerised system, and to request a

copy or extracts thereof, relating to the economic activity

of any person;

(c) without prejudice to the provisions relating to the duty of

professional secrecy, to require any person to give such

information as may be requested for the purpose of

determining whether any supplies have been made by or

to that person or any third party on which that person

may have information, or whether any intra-community

acquisitions or importations have been made by that

person or any third party on which that person may have

information, or the value of any such supply, acquisition

or importation, and to require the attendance of any

person at the office of the Commissioner for the purpose

of providing such information;

(d) to request the particulars including the name, surname,

address and the production of a legally valid

identification document of any person suspected to be

in breach of any of the provisions of this Act or of any

regulations made under this Act; and

(e) to require electronic access to any invoices issued or

received electronically by a taxable person or non-

taxable legal person identified for Value Added Tax

purposes, established in Malta.

If access is required for the purposes of article 53(a) to any

premises occupied in whole or in part for the purpose of habitation,

such access shall require the prior warrant signed by a Magistrate

and shall not take place between seven o’clock in the evening and

seven o’clock in the morning.

(1) Without prejudice to the provisions relating to the duty

of professional secrecy, no information shall be requested by the

Commissioner by virtue of this Act from any persons to whom sub-

article (2) refers except solely for the purpose of determining the

tax payable by and the deductions allowable to such person under

this Act or of ensuring compliance by such person with the

provisions of this Act.

(2)

This sub-article refers to -

(a) a bank licensed under the Banking Act;

(b) an insurance company in respect of long term

insurance business which is carried on pursuant to a

licence granted under the Insurance Business Act;

(c) any person licensed to carry on investment business

under the Investment Services Act;

(d) a collective investment scheme licensed under the

Investment Services Act;

(e) a stockbroker licensed under the Malta Stock

Exchange Act.

Notwithstanding the provisions relating to the duty of

professional secrecy, and anything contained in any other provision

of this Act, the Minister may by regulations prescribe requirements

for any person to retain and furnish the Commissioner such

information as may be required in order to achieve the objective of

combating VAT fraud.

(1) Except as may be necessary for the purposes of this

Act, or where the Commissioner otherwise directs, every person

having any official duty or being employed in the administration of

this Act shall regard and deal with all documents and information

relating to this Act as secret and confidential.

(2)

No person appointed under or employed in carrying out the

provisions of this Act shall be required to produce any document or to

divulge any matter coming under his notice in the performance of his

duties under this Act except as may be lawfully required for the

purpose of carrying into effect the provisions of this Act, or for the

purpose or in the course of any appeal made in accordance with this

Act or a prosecution for any offence against any of the provisions of

this Act, or in the course of an investigation or a prosecution for any

relevant offence or during any judicial or quasi-judicial proceedings

when ordered by a court or tribunal to disclose information

Provided that the provisions of this article shall not prejudice

the international obligations that the Commissioner or any person

referred to in this sub-article may have, including confidentiality

obligations under arrangements made under article 76 of the Income

Tax Act.

(2A) For the purposes of this article, "relevant offence" means a

criminal offence, not being one of an involuntary nature, consisting of

any act or omission which if committed in Malta, or in corresponding

circumstances, would constitute an offence liable to the punishment of

imprisonment or of detention for a term of one (1) year or more.

(3) Notwithstanding the other provisions of this article, the

Commissioner may permit the Auditor General or any officer

authorised by the Auditor General to have access to any records or

documents as may be necessary for the performance of his official

duties and for this purpose the Auditor General and any such

authorised officer shall be deemed to be a person employed in the

administration of this Act.

(4) Notwithstanding the other provisions of this article or of any

other law, the Commissioner shall furnish to the competent authority

designated under the Eco-Contribution Act such information being

information obtained by the Commissioner for any of the purposes of

this Act.

(5) Nothing contained in this article shall, after the accession

d a t e , p r e v e n t t h e d i s c l o s u r e b y t h e C o m m i s s i o n e r, o f a n y

information that is required to be disclosed in terms of Council

Regulation (EU) No. 904/2010 or of any such other Council

Regulation as may be prescribed.

(6) For the purposes of this article, any information disclosed

to the Commissioner by the fiscal authorities of another Member

State in terms of any Council Regulation referred to in sub-article

(5) shall be treated as information relating to and obtained for the

purposes of this Act.

PART VII

Special Cases

(1)

The provisions of the Fourteenth Schedule shall

apply with respect to the special cases prescribed by the Minister in the

said Schedule.

(2)

With respect to the special cases to which the Fourteenth

Schedule applies and the obligations of persons involved in such cases,

the said Schedule shall have effect notwithstanding anything to the

contrary contained in the other provisions of this Act

Provided that the other provisions of this Act shall apply to the

said cases and obligations insofar as they are not inconsistent with

anything contained in the said Schedule.

PART VIII

Collection, Security and Refunds

(1)

All tax, interest and administrative penalties due

under this Act may be sued for and recovered, as the case may require

in the competent court of civil jurisdiction.

(2)

Subject to the provisions of sub-article (3), the

Commissioner may institute an action for the payment of all tax,

interest and administrative penalties at any time within six (6) years

from the date on which such tax, interest or administrative penalty

becomes payable.

(3) The period referred to in sub-article (2) shall be interrupted by

a demand note served through registered post or by publication of a

notice in the Gazette and in one (1) or more daily newspapers by the

Commissioner stating that a demand note has been made or by

publication of a notice on the web portal designated by the

Commissioner for that purpose stating that a demand note has been

made, or by any judicial act filed by the Commissioner before the

expiration of such period requesting the payment of the amount

claimed.

(1) Any notice issued by the Commissioner showing any

amount of tax and administrative penalty due by a person shall,

unless the contrary is proved, be sufficient evidence that that

amount is due to the Commissioner by that person and shall

constitute an executive title within the meaning and for the

purposes of Title VII of Part I of Book Second of the Code of

Organization and Civil Procedure.

(2) The Commissioner may request the payment of any tax and

administrative penalty payable by any person in terms of this Act

by means of a demand note, and if the payment requested is not

made within thirty days from the date when the said demand note is

served on that person, the Commissioner may proceed to enforce

payment in virtue of the executive title referred to in sub-article (1)

after two days from the service on that person of an intimation for

payment made by means of a judicial act. Upon the lapse of the

period of two days mentioned in this sub-article the Commissioner

shall be entitled to register in the public registry or land registry, as

the case may be, a note of privilege for the amount demanded in the

judicial act which note of privilege shall be registered by any

advocate or notary.

(3)

The provisions of article 468 of the Code of Organization

and Civil Procedure shall apply with respect to any warrant issued

on the strength of an executive title mentioned in this article and to

the paying out of the proceeds of the sale by auction of the property

seized, and no opposition or reservation in the schedule of deposit

shall stay the paying of any sum deposited in court following any

such warrant as aforesaid.

(1) No goods imported into Malta shall be delivered for

use in Malta or taken out, cleared or delivered from any customs

bond except -

(a) where the importation of those goods is an exempt

importation; or

(b) where the tax on the said importation has been paid in

accordance with this Act; or

(c) with the authorisation of the Commissioner.

(2) An authorisation for the purpose of paragraph (c) of sub-

article (1) may be given under such conditions and against the

granting of such security as the Commissioner may establish.

(1) The Commissioner shall, for the purpose of ascertaining,

collecting and protecting the tax chargeable under this Act on taxable

importations, have the same powers and shall follow the same

procedures as are in accordance with any other law exercisable and

followed by him for the purpose of ascertaining, collecting and

protecting import duties.

(2) Any provision in the Customs Ordinance or in the Import

Duties Act or in any regulations made thereunder relating to the

application of the proceeds from a sale of imported goods towards

the payment of import duties due on those goods shall be construed

as providing for the application of the said proceeds towards the

payment of import duties and of any tax due under this Act on the

importation of those goods.

The Commissioner shall have a special privilege over the

assets of a person in respect of any tax due by that person under this

Act and the said tax shall, notwithstanding anything contained in

any other law, be paid in preference to a debt having any other

privilege, excepting a debt having a general privilege and a debt

mentioned in article 2009(a) or (b) of the Civil Code.

(1) If, in any particular case, the Commissioner has reason

to believe that tax due by a person might not be recoverable at the

time when that tax becomes payable in terms of this Act, he may by

a notice served on that person, demand the payment of the tax

within such time as may be specified in that notice and the tax shall

thereupon become payable within that time notwithstanding any

other provision of this Act.

(2) When a payment has been demanded from a person in

accordance with sub-article (1), that person may, instead of making

the said payment, furnish such security for the tax payable as may

be acceptable to the Commissioner.

(3) The co-contracting party of the person liable to pay the tax

shall be held jointly and severally liable for the payment of the tax.

(4) The provisions of sub-article (3) shall not apply to an

operation referred to in article 20(1) when and to the extent that the

co-contracting party proves that he has paid the price and the

related tax due to the supplier.

(5) Where it appears to the Commissioner that it is necessary

for the protection of Government revenue, he may, at any time,

under conditions approved by the Minister, require a taxable

person, as a condition for that person to supply goods or services,

to give such security, or further security, for that amount and in

such manner as the Commissioner may determine, for the payment

of any tax that is or may become due by him under this Act.

If, in any particular case, the Commissioner has reason to

believe that the tax due by a person registered under article 10

could otherwise be prejudiced, he may, by means of a notice in

writing, require that person to furnish a tax return for a tax period

before the time allowed in terms of the other provisions of this Act,

and in respect of that tax return any reference in this Act to the time

allowed in terms of any provision of this Act shall thereupon be

construed as a reference to the period specified in the said notice.

(1) Where any assets belonging to an economic activity of

a person are sold by judicial auction pursuant to any proceedings

exercised by a creditor or by creditors of that person, and where

that sale is treated as a supply of goods in terms of the relevant

provisions of the Second Schedule and is subject to tax under this

Act, the registrar of the court under the authority of which the sale

is made shall, after notifying the person or persons appearing to be

interested therein, remit to the Commissioner from the proceeds

lodged in court, with preference over any other person not having a

prior claim to that of the Commissioner as provided for in article

62, the tax chargeable on that supply.

(2) Any interested person may oppose the remittance referred

to in sub-article (1) by means of a sworn application filed against

the Commissioner within six working days from the date of the

notification referred to in the said sub-article.

(3) No bid animo compensandi shall be approved for the

purposes of article 331 of the Code of Organization and Civil

Procedure unless the tax chargeable, if any, on that supply has been

lodged in court and remitted by the Registrar in accordance with

sub-article (1).

(1) Any secretary, manager, director, liquidator or other

principal officer of an entity or of a body of persons, any heir and

any testamentary executor and any curator of the vacant inheritance

of a deceased person, any parent or guardian of a minor, and any

person who is a tutor, curator, administrator or trustee of any other

person or of any trust, fund or other entity shall, for the purposes of

this Act, be a representative of that body of persons, deceased

person, minor, other person, trust, fund or other entity, as the case

may be.

(2)

(a) When a person who is not established in Malta and is

not established in the Community, is or is required to

be registered under this Act any person resident in

Malta to whom he makes a taxable supply or who is his

agent or who otherwise has a business relationship

with him shall, if so designated by the Commissioner

by means of a notice in writing, and unless another

person resident in Malta and acceptable to the

Commissioner has been so designated by that first-

mentioned person, be a representative of the said

person.

(b) When a person who is not established in Malta, but is

established in the Community, is, or is required to be

registered under this Act, he may, by means of a notice

in writing to the Commissioner, nominate as his

representative, any person resident in Malta who is

acceptable to the Commissioner.

(c) For the purpose of this sub-article, the Minister may by

regulations prescribe the conditions regulating such

appointment.

(3)

(a) Subject to the provisions of sub-article (5) a

representative of a person shall be liable in the same

manner and to the same extent as the person of whom

he is a representative for all the obligations imposed by

or under this Act.

(b) Anything done or omitted to be done by a

representative acting as such shall for the purposes of

this Act be deemed to have been done or omitted to be

done by the person of whom he is a representative.

(c) Any notice served on or any refund paid to a

representative in his capacity as such under any of the

provisions of this Act shall be deemed to have been

served on or to have been made to the person of whom

he is a representative.

(d) The existence of or the designation of a person as a

representative of another person shall not relieve the

latter person from any obligation or liability under this

Act.

(4) A representative who has under his management or control

any funds or property belonging to or due to the person of whom he

is a representative shall not dispose of such funds or property

unless he has made adequate provision for any tax due under this

Act.

(5) A representative shall be jointly and severally liable with

the person of whom he is a representative for the tax due by that

person: provided that where the representative has acted in good

faith and is not knowingly in breach of sub-article (4) or of any

other obligation under this Act, his liability under this sub-article

shall be limited to the funds or to the value of any property under

his management or control which belongs or is due to the person of

whom he is a representative.

(1) When a person furnishes a tax return or notice of

payment within the time laid down in the relevant provisions of this

Act and such tax return or notice of payment is accompanied by a

payment of all or part of the tax declared to be payable therein,

such payment shall be deemed to be made on account of the tax

payable on that tax return or notice of payment.

(2) When a person furnishes a tax return or notice of payment

within the time laid down in the relevant provisions of this Act and

such tax return or notice of payment is not accompanied by a

payment of all the tax declared to be payable therein, such person

may request, by the furnishing of such form as the Minister may by

regulations prescribe, that any payment accompanying such form

shall be deemed to be made on account of the tax declared to be

payable in such tax return or notice of payment, so however that

(a) such request shall not be valid if it is made later than

six months from the time within which the tax return

or notice of payment is required to be furnished in

terms of the relevant provisions of this Act;

(b) the provisions of sub-articles (3) and (4) shall apply to

such payment.

(3) Subject to the provisions of sub-articles (1) and (2), when

any interest is due by a person on any tax, other than tax the

payment of which m ay be kept in abeyance in terms of the

provisions of the Ninth Schedule to this Act, any payment made by

that person to the Commissioner shall, notwithstanding any

declaration made by that person, be appropriated to that interest

before it is appropriated to any tax.

(4) Subject to the provisions of sub-articles (1), (2) and (3),

when an administrative penalty is due by a person, other than a

penalty the payment of which may be kept in abeyance in terms of

the provisions of the Ninth Schedule to this Act, any payment made

by that person to the Commissioner shall, notwithstanding any

declaration made by that person, be appropriated to such

administrative penalty before it is appropriated to any tax.

(5) Subject to the other provisions of this article, when tax due

by a person, other than tax the payment of which may be kept in

abeyance in terms of the provisions of the Ninth Schedule to this

Act, became due on more than one occasion any payment made by

that person to the Commissioner shall, notwithstanding any

declaration made by that person, be appropriated to that amount of

tax that became due at the earliest of those occasions before it is

appropriated to the tax that became due on subsequent occasions.

(6) When a payment is made by a person to the Commissioner

in circumstances which indicate that that person intended that

payment to relate to a tax return or notice of payment, that payment

shall be deemed to relate to that tax return or notice of payment for

the purposes of this article without prejudice to the power of the

Commissioner under any other provision of this Act to appropriate

that payment in any other manner.

(1) Tax paid shall not be refundable except in the

circumstances provided in Part IV or articles 69, 70 and 71.

(2) When any amount is refundable by the Commissioner to a

person by whom any interest, administrative penalty or tax is due,

the Commissioner may deduct such tax, interest or administrative

penalty from that amount to the same extent to which that amount,

had it been a payment made by that person, would fall to be

appropriated to such interest, penalty or tax in accordance with the

provisions of article 67 and in the same order: provided that a

deduction under this sub-article may also be made with respect to

tax that may be kept in abeyance in terms of the provisions of the

Ninth Schedule to this Act.

(3) A refund due in accordance with any provision of this Act

shall be payable without any further appropriation other than this

Act by warrant under the hand of the Minister.

(1) Subject to the provisions of sub-article (2) where it

results that any tax paid by a person was not due or was in excess of

the tax due under this Act , the Comm issioner shall, on the

production of such evidence as he may deem fit to require, repay

the tax or that part thereof which was not due to that person or to

any other person who may be entitled to that repayment: provided

that nothing in this sub-article shall be construed as overriding or

replacing the provisions of article 43.

(2) The Minister may by regulations prescribe the manner and

the time within which a claim for a repayment under sub-article (1)

may be made and such conditions and limitations, including a

minimum amount in respect of which a repayment may be claimed,

as he may deem fit.

(3) Where it results from a decision given on an appeal made in

accordance with this Act, that any amount of tax paid by a person

was not due, the Commissioner shall refund such amount to that

person within thirty days from the date such decision becomes res

judicata.

(4) Interest at the rate specified in or prescribed in terms of

article 21(4) shall be due on a refund to which sub-article (3) refers

for the period ending on the date when the refund is paid or a

cheque or draft is posted by the Commissioner to the person to

whom the refund is payable, which interest shall run -

(a) if and to the extent that the amount refundable had

been claimed as excess credit in a tax return furnished

to the Commissioner by the appellant, from the date

established in accordance with article 24;

(b) if and to the extent that the amount refundable was

paid by the appellant as a condition for the validity of

his appeal in accordance with the provisions of the

Ninth Schedule to this Act, from the date on which that

amount was paid to the Commissioner;

(c) in any other case, from the date the refund is payable

in accordance with sub-article (3).

The Minister may by regulations prescribe for the refund by

the Commissioner of the tax paid on supplies, intra-community

acquisitions or importations by diplomatic or consular arrangements or

by a person who qualifies for an exemption from tax in accordance

with such international arrangements as the Minister may in

accordance with such regulations prescribe

Provided that the grant of such refund shall be subject to such

conditions and limitations as may be established in the said

regulations.

The Minister may by regulations provide for the repayment

by the Government, subject to such limitations, conditions and

formalities as may be prescribed in the said regulations, of

(a) an amount not exceeding the tax chargeable on

supplies made to non-taxable physical persons of

goods exported by them outside Malta;

(b) tax paid on the supply of goods that are exported by

the persons acquiring them in the framework of their

humanitarian, charitable or teaching activities;

(c) tax paid on supplies to, or intra-community

acquisitions and importations by, persons or classes of

persons eligible under such schemes as may be

specified in the regulations.

PART IX

Miscellaneous

(1) Any notice, warrant or other proceeding purporting to

be made in accordance with the provisions of this Act shall not be

deemed to be void or voidable for want of form or be affected by

the reason of a mistake, defect or omission therein, if the same is in

substance and effect in conformity with or according to the intent

and meaning of this Act.

(2) In the case of a body of persons it shall be sufficient if only

the name of the body of persons appears on any notice, warrant or

proceeding, including any proceeding in the Court of Appeal,

issued or made under or for the purposes of this Act.

(1)

Every notice to be served on a person by the

Commissioner under this Act shall be signed by the Commissioner or

by any person authorised by the Commissioner and every such notice

shall be valid if the signature is printed, stamped or written thereon

Provided that any notice given electronically by the

Commissioner shall not be required to be signed and shall be valid if it

is

(a)

made available to that person through the web

portal designated by the Commissioner for that purpose; or

(b)

given to that person from any electronic address

belonging to the Commissioner, including generic electronic

addresses, or belonging to a person authorised by the

Commissioner.

(2)

Any notice required to be given to a person under this Act

by the Commissioner or any other person authorised by the

Commissioner may be served either personally, electronically or by

being sent by post. A notice shall be deemed served where

(a)

it is sent by registered post, as evidenced by proof

that the notice was properly addressed and shall be deemed to

have been served in the case of an address in Malta not later

than the third day subsequent to the day when it was posted, and

in the case of an address outside Malta on the day subsequent to

that on which the notice would have been received in the

ordinary course by registered post;

(b)

it is sent electronically to an electronic address

provided by that person, or on behalf of that person, to the

Commissioner through the web portal designated by the

Commissioner for that purpose; or

(c)

it is made available to that person through the web

portal designated by the Commissioner for that purpose

Provided that where such notice is not served on a

person because that person could not be found or for other

reasons attributable to that person and the Commissioner

publishes a notice in the Gazette and in one (1) or more daily

newspapers, or the Commissioner makes a notice publicly

available on the web portal designated by the Commissioner for

such purpose, stating that a notice has been made and inviting

that person to collect it as and where directed by the

Commissioner, then such notice shall also be deemed to have

been duly notified on the date of such publication on that web

portal

Provided further that a cheque or draft posted by

the Commissioner shall be deemed to be a payment for the

amount thereof made on the date indicated on that cheque or

draft.

(3)

For the purposes of sub-article (2), a notice sent by

registered post shall be deemed to have been properly addressed if it

has been addressed to any known business or private address of a

person.

(4)

The Commissioner may publish on the web portal designated

by the Commissioner for this purpose the closing times of the offices of

the Commissioner and any period established in, or under this Act for

the furnishing, delivery or service of a return, notice or other document

to the Commissioner or for any payment to the Commissioner and such

period shall be deemed to expire at the closing time of the last day of

such period

Provided that this sub-article shall not apply to any return,

notice, other document or payment made electronically through the

means designated for such purpose by the Commissioner.

(5) When the date on which any return, notice or other document is

to be furnished, delivered or served or deemed to be served or on which

a payment is to be made in terms of any provision of this Act falls, were

it not for the provisions of this sub-article, on a Saturday or a Sunday, or

on a national day or a public holiday as established in the National

Holidays and other Public Holidays Act, such date shall be deemed to

fall on the first working day, other than a Saturday, following the said

Saturday, Sunday, national day or public holiday.

(1)

Any artificial or fictitious scheme which directly or

indirectly results in the accrual of a tax advantage when the essential

aim of that scheme is for a person to obtain said advantage the grant of

which would be contrary to the purpose of the provisions of this Act,

shall be disregarded in such a manner as to redefine the scheme so as

to re-establish the situation that would have prevailed in the absence of

such scheme.

(2)

Notwithstanding the other provisions of this Act, no amount

shall be treated as input tax of a person in terms of article 22(2) to the

extent to which it represents tax chargeable on goods or services

having been the subjects of VAT fraud committed upstream or

downstream in the chain of supply, when that person knew or should

have known of such fraud, irrespective as to whether that person

actively participated in that fraud.

(3)

When the Commissioner has reason to believe that the

provisions of sub-articles (1) or (2) apply, he may make an assessment

in accordance with articles 31, 32 or 33 determining the tax liability or

the entitlement to any input tax credit, refund or set-off of tax of the

said person, for any tax period, in such manner and in such amount as

may be necessary according to the circumstances of the case

Provided that this shall not prejudice the right of a person to

object to such an assessment and to appeal from a decision of the

Commissioner refusing that objection. The relevant provisions of this

Act relating to objections and appeals shall apply mutatis mutandis.

(4) In this article "scheme" includes any transaction or sequence

of transactions, disposition, agreement, arrangement, trust, grant,

covenant, transfer of assets, structure, alienation of property,

irrespectively of the date on which such scheme was made, entered

into or set up.

(1) The Minister may by regulations -

(a) amend, cancel or substitute any of the Schedules,

except for the Ninth Schedule, to this Act;

(b) prescribe any matter which may in any particular case

be deemed necessary for the purpose of avoiding

significant distortions in competition which might

otherwise result from the application of any of the

provisions of this Act;

(c) make provision for the rounding up or down of any

amount in any computation made for any of the

purposes of this Act, or for disregarding any small

amounts in any such computation;

(d) prescribe anything that may be prescribed in virtue of

the provisions of this Act;

(e) prescribe any conditions and determination that may,

in accordance with this Act, be imposed or made by

the Commissioner;

(f)

prescribe any other matter for securing the payment of

the tax and generally for giving effect to the provisions of

this Act, including enforcement provisions and

applicable fines (multi) and administrative penalties; and

(g) amend, revoke or substitute any regulations made

under this Act.

(2) Any guidelines, explanations or instructions relating to this

Act or to any regulations prescribed in terms of sub-article (1)

contained in a publication or circular by or under the authority of the

Commissioner and distributed or made available to taxable persons

in general, shall be read and construed as one with such regulations

and shall have the same effect as the regulations to the extent that

such guidelines, explanations or instructions are not in conflict

with this Act or the said regulations or with guidelines, explanations

or instructions published at a later date and to the extent that -

(a) they give a definition of any term or an interpretation or

any provision contained in this Act or the regulations;

(b) they determine the manner in which any provision of

this Act or the regulations is to be applied;

(c) they determine the manner which, in accordance with this

Act or the regulations, may be determined by or subject to

the approval or the discretion of the Commissioner.

PART X

Offences and Punishments

Any person who -

(a) fails to apply for registration at the time and in the

manner required by article 10 or 12;

(b) fails to keep or to store records, documents and

accounts for the time and in the manner required by

this Act or any regulations made under this Act;

(c) fails to furnish any tax return, additional return, statement

or information when required to do so in virtue of this

Act or of any regulations made under this Act;

(d) fails to produce or provide access to any books, records,

documents, information and accounts, or fails to pay any

tax or administrative penalty due when required to do so

in virtue of this Act or of any regulations made under this

Act;

(e) supplies goods or services having failed to provide the

security requested by the Commissioner under article

63(5),

shall, on conviction, be liable to a fine (multa) of not less than seven

hundred euro (€700) and not exceeding three thousand and five

hundred euro (€3,500) and, on a request by the prosecution, the court

shall, in respect of an offence under paragraph (c), order the offender

to comply with the law within a time sufficient for the purpose, but

in any case not exceeding three months, and in default the offender

shall be liable to the payment of a further fine (multa) of five euro (€5)

for every day that the default continues after the lapse of the time

fixed by the Court

Provided that the offender may, within thirty days after

final judgement, apply to the Court which convicted him,

requesting a total or partial remission of the penalty imposed under

this article. The Court may grant a total or partial remission of such

penalty provided that the prosecution, with the written concurrence

of the Commissioner to be filed with any reply to such application,

agrees to such request. Any such application shall be served on the

prosecution which shall reply within fifteen working days from

such notification.

Any person who -

(a) knowingly fails to account for any taxable supply or

any intra-community acquisition made by him in the

records, documents and accounts required by this Act

or any regulations made under this Act;

(b) gives any return, statement or information required for

any of the purposes of this Act which he knows to be

incorrect or misleading in any material respect;

(c) falsifies any records, documents or accounts required

to be kept under this Act or prepares or draws up or

helps in the preparation or drawing up or makes use of

any false records or documents;

(d) with the intent of concealing any evidence which he

knows or is reasonably expected to know to be

relevant for any purpose of this Act destroys, erases,

damages or conceals any stored information or any

records, documents or accounts, or is in possession of

or supplies to another person any software application

that would erase, destroy, damage or conceal any

stored information or any such records, documents or

accounts;

(e) fails to provide or produce a tax or other invoice or

document as and when required by article 50, 51 or 52

or provides any such tax or other invoice or document

which is incorrect or misleading in any material

respect or fails to provide to the Commissioner,

without any valid reason, all copies of any used or

unused manual fiscal receipts where required by the

Commissioner;

(f)

is an employee or agent of another person, and whose

functions in that capacity include that of providing or

producing a tax or other invoice or document which

that other person is required to provide or to produce

in terms of article 50, 51 or 52, fails to provide or

produce such tax or other invoice or document or

provides any such tax or other invoice or document

which is incorrect or misleading in any material

respect;

(g) provides an invoice or other document in respect of a

supply showing tax to be chargeable on that supply in

a case where he knows that no tax is chargeable or

where the tax chargeable is less than that shown or

otherwise knowingly adds to or includes in a price for

a supply any amount purporting to represent tax which

is not due or which is higher than the tax due;

(h) applies to be registered under articles 11 or 11A in

circumstances indicating that he knows or could with due

diligence have known that he is not entitled to be so

classified;

(i)

being registered under articles 11 or 11A and not being

eligible to remain so registered does not apply for the

cancellation of such registration in the manner required

and within the time stipulated in this Act;

(j)

being registered under articles 11 or 11A purports in

connection with any transaction not to be so registered

for the purpose of obtaining any financial gain;

(k) not being registered under articles 11, 11A or 11B purports

in connection with any transaction to be so registered for

the purpose of obtaining any financial gain;

(l)

having added to or included in a price for goods or

services supplied by him to another person any amount

purporting to represent tax chargeable under this Act,

knowingly fails to account for that amount in his

records and accounts or to pay that amount to the

Commissioner;

(m) acquires possession of or deals with any goods, or

accepts the supply of any services having reason to

believe that the tax on the supply of the said goods or

services has been or will be evaded;

(n) supplies or offers to supply to another person goods or

services the acquisition or dealing with which or the

acceptance of which would render that other person

guilty of an offence in virtue of paragraph (m);

(o) supplies or offers to supply to another person and, or

puts up for sale goods, without being in possession, at

the place where he supplies or offers to supply to

another person and, or puts up for sale goods, of a

fiscal cash register or manual fiscal receipt books as

issued or approved by the Commissioner;

(p) being a credit or financial institution which supplies

money or grants credit by way of a loan account

facility or by means of any other kind of facility to a

customer in connection with the supply of goods or

services by third parties to that customer for the

construction, re-construction, repair, refurbishment or

maintenance of immovable property or for fixtures

related thereto, and which effects payment for such

goods or services either directly to the vendor or

supplier thereof or to a third party or to the customer

subject to an understanding or to an express or implied

condition that the amount paid will be passed on to the

said vendor or supplier, by the debit of the customer’s

loan account or other facility, on the basis of

supporting documents, including contracts, invoices,

receipts, architects’ or other certificates, or similar

documents, submitted by or on behalf of the customer

or by or on behalf of suppliers, contractors or other

third parties, and which fails to inform the

Commissioner of the names and VAT registration

numbers of the said suppliers, contractors or other

third parties as aforesaid, other than the customer, to

whom it has directly or indirectly made payments as

specified in this paragraph, in the form required by the

Commissioner, as well as of the amounts of such

payments, by not later than the end of the calendar

quarter immediately following the calendar quarter

during which it directly or indirectly made any

payment as aforesaid,

shall be guilty of an offence and shall, on conviction, be liable -

(i)

to a fine (multa) of not less than six thousand

euro (€6,000) and not exceeding ten thousand

euro (€10,000) for an offence committed under

paragraphs (c) and (d); and

(ii) to a fine (multa) of not less than seven hundred

euro (€700) and not exceeding three thousand

five hundred euro (€3,500) for an offence under

the other paragraphs,

and in addition, for any offence as above referred to in all

paragraphs, except for paragraph (p), where tax amounting to more

than one hundred euro (€100) would be endangered, to a further

fine ( multa ) equal to two times the endangered tax or to

imprisonment of not more than six months or to both such fines and

imprisonment

Provided that, the two times fine (multa) for the endangered

tax shall in no case be less than one thousand euro (€1,000).

In addition, on a request by the prosecution, the court shall

order the offender to comply with the law within a time sufficient

for the purpose, but in any case not exceeding one month, and, in

default, the offender shall be liable to the payment of a further fine

(multa) of five euro (€5) for every day on which the default continues

after the lapse of the time fixed by the Court.

(1) Where a person has been convicted under either article

76 or article 77 and is again convicted of an offence under either of

the said articles committed within six months from the date of the

previous conviction, the fine (multa) shall in no case be less than

one thousand and two hundred euro (€1,200).

(2) Where a person has been convicted of four offences

committed under either of the articles aforesaid in a period of

twenty-four months, the court shall on the latest of the said

convictions impose a fine (multa) of not less than two thousand and

five hundred euro (€2,500) and in addition to the punishment for that

conviction order the suspension for a determinate time of not less

than one week and not more than one month of all licences,

permits, warrants or other authorisation granted by the Police or by

any other authority to carry on the economic activity or activities to

which the offences relate.

Any person who -

(a) obstructs, hinders, impedes or does anything which is

calculated to obstruct, hinder or impede, or molests or

assaults the Commissioner or any person duly engaged

in the exercise of any power or duty conferred or

imposed on him by or under this Act;

(b) being a person in charge of any premises which the

Commissioner or any person authorised by the

Commissioner is empowered to enter in terms of

article 53(a) fails to allow access to the said premises

to the Commissioner or authorised officer or fails to

take such measures as may be reasonably required of

him for the purpose of any such access or of any

inspection of that premises or of any goods, assets,

books, records or documents kept therein,

shall be guilty of an offence and shall, on conviction, be liable to a

fine (multa) of not less than five hundred euro (€500) and not more

than two thousand and five hundred euro (€2,500), or to

imprisonment of not more than six months, or to both such fine and

imprisonment.

(1) The provisions of articles 18, 60, 62 and 62A of the

Customs Ordinance shall apply to this Act as if all references to

duties contained in those articles were references to tax due under

this Act, and any person who is in contravention of the provisions

of the said articles construed as aforesaid in relation to any goods

whose importation is subject to tax under this Act shall, without

prejudice to any liability incurred under the said Ordinance, be

guilty of an offence under this Act and shall on conviction, be

liable to a fine (multa) equivalent to three times the tax payable or

to a fine (multa) of three hundred and fifty euro (€350), whichever

shall be the greater, so however that one third of the said amount

shall be deemed as a civil debt due to the Commissioner, or to

imprisonment for a term not exceeding two years or to both such

fine and imprisonment and the offender may be either detained or

proceeded against by summons, in the same manner and form, and

subject to all other provisions laid down in the Criminal Code.

(2) The provisions of article 77 of the Customs Ordinance shall

apply in relation to goods whose importation is subject to tax under

this Act as if any reference contained therein to the duty therein

mentioned were also a reference to the tax chargeable under this

Act.

(3) The importation of goods subject to tax under this Act

shall, for all purposes of any law, be deemed as a prohibited

importation unless the said tax is duly paid or, where the payment

of the tax has been postponed in accordance with any provisions of

this Act, the conditions imposed in connection with such a

postponement are duly observed.

Any person who knowingly contravenes or fails to comply

with any of the provisions of this Act or any regulations made

under this Act shall be guilty of an offence and shall on conviction,

unless the offence is subject to a greater punishment under any

other provision of this Act or any other law, be liable to a fine

(multa) of not less than two hundred and fifty euro (€250) but not

exceeding one thousand and two hundred euro (€1,200), or to

imprisonment for a term not exceeding three months, or to both

such fine and imprisonment.

(1) In addition and without prejudice to any liability of an

employee or other person, where any thing is done or omitted to be

done by a body of persons, the provisions of this Part shall apply as

if such thing were done or omitted to be done by every director,

manager or other principal officer of that body of persons: provided

that a director, manager or other principal officer of a body of

persons shall not be guilty of an offence in virtue of this sub-article

if he proves that he was unaware and could not with reasonable

dil igen ce be aware of such act or omission and that he did

everything within his power to prevent that act or omission.

(2) Where anything is done or omitted to be done by an

employee in the course of his employment, or by any person acting

on behalf of the registered person, whether such other person is an

employee or not, the provisions of this Part shall apply as if such

thing were done or omitted to be done both by the said employee or

other person and by the employer or registered person: provided

that such an employer or registered person shall not be guilty of an

offence in virtue of this sub-article if he proves that he was

unaware and could not with reasonable diligence be aware of such

an act or omission and that he did everything within his power to

prevent that act or omission.

(1) Deleted by III of 2026 .

(2) Notwithstanding the provisions of the Criminal Code, the

Attorney General shall have a right of appeal to the Court of

Cri m in al App eal f ro m any j udg m ent g ive n b y th e Co urt of

Magistrates in respect of criminal proceedings under this Part.

(3)

Deleted by VII of 2019

(4) Article 21 of the Criminal Code and the Probation Act shall

not apply with respect to any conviction under this Act.

(5) In any criminal proceedings under this Part the

Commissioner personally or any other officer designated by him

may, notwithstanding the provisions of any other law, produce the

evidence, plead and otherwise conduct the prosecution instead of or

jointly with the police.

(6) Should the evidence of the Commissioner or of the officer

designated by him as aforesaid be required as part of the case for

the prosecution, he shall be heard before assuming the duties of a

prosecuting officer unless the necessity of his giving evidence

arises at a later stage: provided that the Commissioner or other

officer as aforesaid may state the facts constituting the offence

before giving evidence.

(1) Notwithstanding any other provisions of this Act, the

Commissioner may, in the case of an offence under this Act, enter

into an agreement in writing with the offender whereby the said

offender pays a sum equivalent to the fine (multa) that may be

imposed by way of penalty in accordance with this Act on the

conviction of that person for the said offence, sohowever that

where a minimum and a maximum amount is provided for in

respect of the fine (multa) that may be so imposed, the sum payable

pursuant to the said agreement shall be a sum equivalent to the said

minimum amount increased by one half of the difference between

the said minimum and maximum amounts, and upon the signing of

any such agreement by the Commissioner and the offender all

criminal liability of the offender under this Act with regard to the

offences in relation to which the agreement has been entered shall

be extinguished.

(2) The provisions of sub-article (1) shall apply also in any

case where the offender has been charged before a court in relation

to the offence but before final judgment has been given in the case

Provided that where proceedings before a court have not

b e e n co m m e n c e d, t he s u m pa ya bl e i n a c c o r da nc e wi t h an y

agreement as contemplated in sub-article (1) shall be reduced by

ten per cent.

(3) Notwithstanding the provisions of sub-articles (1) and (2),

the Commissioner may, in the case of an offence by any person

against the provisions of articles 76(b), 77(e), 77(f), and 77(o),

enter into an agreement with the offender, whereby the said

offender pays to the Commissioner within fifteen days from receipt

of a notice to this effect by the Commissioner the following

(a) one hundred euro (€100) in the case of a first offence;

(b) two hundred euro (€200) in the case of a second

offence;

(c) four hundred euro (€400) in the case of a third offence;

and

(d) five hundred euro (€500) in the case where the

offender and, or any of his employees or any other

person acting on his behalf is found in default on two

separate occasions within a period of six months;

and upon the payment of such fine (multa), all criminal liability under

this Act with regard to the offences in relation to which the fine (multa)

has been paid, shall be extinguished.

(4) Any sum due in virtue of an agreement entered into in terms

of sub-article (1) or sub-article (3) shall be due to the Government

as a civil debt. The Commissioner shall not enter into an agreement

as is referred to in sub-article (1) or sub-article (3) unless such

agreement is accompanied b the payment of the sum due or a

sufficient security for its payment.

(5) The provisions of this article shall be without prejudice to

any proceedings or forfeiture instituted or having effect in virtue of

any other law.

(6) The said agreement and the payment of the fine (multa) so

imposed shall be without prejudice to any tax, interest and

administrative penalty due under this Act

Provided that the Commissioner, as head of the Department

of Customs, may impose and collect penalties relating to tax on

importation due under this Act, in the case of an agreement having

been reached in accordance with the provisions of article 63 of the

Customs Ordinance, and may also impose and collect penalties in

the case of an agreement having been reached in accordance with

the provisions of article 63A of the said Ordinance, so however that

any reference to the duty in the fine (multa) referred to in article

63A shall be construed as if it were a reference to the tax due under

this Act.

(1)

Notwithstanding any other provision of this Act or of

any other law, upon the conclusion of an agreement made in terms of

this article between the Commissioner and any person obliged to make

any payment under this Act, hereinafter in this article referred to as the

"debtor" or the "taxpayer", providing for the payment of an additional

penalty together with any other penalties otherwise provided in this Act,

all criminal liability of the debtor for any breach against this Act and for

any connected breach in respect of the acts in relation to which the

agreement has been entered, shall be extinguished

Provided that the additional penalty that such person shall be

liable to pay in respect of such breach or breaches shall amount to a

minimum of ten thousand euro (€10,000) and a maximum of one million

euro (€1,000,000), and shall be imposed in terms of a Schedule to be

prescribed by the Minister under this Act, and this in addition to any

other amount provided for in this Act for the debtor’s default and

quantified according to the final agreement

Provided further that the agreement to pay any fine or make

any other payment under an agreement as provided for in this article

shall not extinguish any civil liability to make any payment not covered

by the agreement entered into in terms of this article.

(2)

(a)

The provisions of this article shall apply where the

Commissioner, acting upon the written request of the taxpayer and the

notification of adjustment of previous declarations given by the

taxpayer, accepts that the adjustments have been correctly made and

shall give notice in writing to the taxpayer of a draft agreement in terms

of this article to be signed within six (6) months from the date of the

request of the taxpayer

Provided that the said period of six (6) months may be

extended by the Commissioner if he is satisfied that a longer period is

required to determine the extent of the proceeds of the breach.

(b)

The draft agreement shall include the following

(i)

details of the breach or breaches which may

include admissions made by the debtor;

(ii) an obligation upon the debtor to pay and a

quantification of an additional penalty and any other payment

due in terms of this Act for the default;

(iii) the period allowed for the payment of the amounts

due under the agreement;

(iv) the consequences of any failure to comply with any

terms of the agreement including those provided in articles 187A,

187B and 187C of the Criminal Code;

(v)

any other terms and conditions imposed by the

Commissioner

Provided that when a draft agreement is notified as aforesaid,

an agreement in terms of this sub-article shall be signed and returned to

the Commissioner within one (1) month, and if the signed agreement is

not received by the Commissioner within the said timeframe, which may

be extended by the Commissioner upon reasonable cause being shown

by the taxpayer, the provisions of this article shall have no effect

Provided further that the amount resulting from this

agreement shall constitute an executive title within the meaning of and

for the purposes of Title VII of Part I of Book Second of the Code of

Organisation and Civil Procedure.

(3)

The period of prescription in respect of the breach and

connected breaches shall be suspended during the times established in,

or under sub-article (2) and no prosecution shall be instituted in respect

of the breach and connected breaches during the time when those

periods are running

Provided that no prosecution shall be annulled on the ground

that it was instituted in violation of this sub-article.

(4)

The provisions of this article shall also apply upon the request

of the debtor in any case where the debtor has been charged before a

court in relation to the breach or breaches and connected breaches, but

before final judgment has been given in the case.

(5)

Where proceedings are pending before the Court of

Magistrates as a court of criminal inquiry and the existence of an

agreement is brought to the Court’s notice, the Court shall, upon being

satisfied that the breach or breaches mentioned in the charge are

breaches to which this article applies or connected breaches, assume the

function of a court of criminal judicature and declare the criminal

action extinguished in respect of such charges. The Court shall

likewise declare the criminal action extinguished if it is a court of

criminal judicature whether at first instance or at appeal stage

notwithstanding any previous judgment delivered in the cause which

has not become final.

(6)

In this article

"agreement" means and includes a document evidencing

an agreement reached between the Commissioner and the debtor

in terms of this article and also includes a document or a

declaration issued by the Commissioner after the coming into

force of this article confirming that the debtor has before the

coming into force of this article regularised his position with the

Commissioner and has after the coming into force of this article

satisfied the requirements thereof by accepting to pay the

additional penalty;

"breach" or "breaches" includes any act or acts which

constitute a criminal offence;

"Commissioner" means the Commissioner for Tax and

Customs;

"connected breach" means any act which constitutes a

criminal offence committed in pursuance of committing a breach

against this Act and shall include

(i)

a breach committed, even if at different

times, in pursuance of a pre-concerted plan to commit a

breach against this Act;

(ii)

a breach committed with the object of

procuring the means for the commission of a breach

against this Act;

(iii) a breach committed with the object of

facilitating the commission or completion of a breach

against this Act, or of ensuring impunity for such a

breach;

(iv) a breach which in a single context violates

more than one provision of law where at least one

provision relates to a breach against this Act;

(v)

a breach committed through the apparently

legitimate use of the proceeds of a breach against this Act

Provided that a connected breach shall not include

any act included in Sub-title IV of Title III of Part II of Book

First of the Criminal Code;

"this Act" includes any subsidiary legislation issued

thereunder.

PART XI

Transitory Provisions