Regulations, 2004

L.N. 219 of 2004

VALUE ADDED TAX ACT

(CAP. 406)

Value Added Tax (Refund of Value Added Tax to taxable

persons not established in Malta but established in the

territory of the Community and who realise only in Malta

operations allowed by the these regulations),

Regulations, 2004

IN exercise of the powers conferred by articles 25 and 75 of the

Value Added Tax Act, 1998, hereinafter referred to as “the Act”,

the Prime Minister and Minister of Finance has made the following

regulations>-

(1) The title of these regulations is the Value Added Tax Citation and

commencement.

(Refund of Value Added Tax to taxable persons not established in

Malta and established in the territory of the Community and who

realise only in Malta operations allowed by the these regulations),

Regulations 2004.

(2) These regulations shall come into force on 1st May,

2004, and shall apply solely to input tax that becomes chargeable on

or after that date.

(1) For the purposes of these regulations, and unless the Interpretation.

context otherwise requires, “a taxable person not established in

Malta” shall mean a taxable person who during the time of supply

in question, does not have his place of his economic activity nor a

fixed establishment from which business transactions are effected,

or, if no such place of his economic activity or fixed establishment

exists, his domicile or his normal place of residence in Malta, and

who, during the same period, has supplied no goods or services

deemed to have been supplied in Malta, with the exception of>

(a) transport services and services ancillary thereto

exempted pursuant to, insofar as these form part of the taxable

value, in accordance with item 12 of the Seventh Schedule to

the Act, and items 1, 2, 4(2), 4(3), 5, 6, 7 and 8(1) of Part One

of the Fifth Schedule to the Act<

(b) services provided in cases where tax is paid solely

by the persons to whom they are supplied, pursuant to items 7,

9, 10, 11 (1) and 12 of the Third Schedule to the Act where the

services are supplied and carried out by a taxable person not

established in Malta.

(2) “Territory of the Community” shall mean the

territories defined in the Sixteenth Schedule to the Act.

The Commissioner of VAT shall refund to any taxable

person not established in Malta, but who is established in another

Member State, subject to the conditions set out below, any value

added tax charged in respect of services rendered or movable property

supplied to him in Malta by other taxable persons or charged in

respect of the importation of goods into Malta, in so far as such

goods and services are used for the purposes of the provision of

services referred to in regulation 2 (1) (a) and (b) of these regulations.

To qualify for a refund, any taxable person referred to in

regulation 3 of these regulations who supplies no goods or services

deemed to be supplied in Malta shall>

(a) submit to the Commissioner an application on the

form prescribed in the First Schedule to these regulations,

attaching the originals of the invoices and, or import documents<

(b) produce evidence in the form of a certificate drawn

up in the Maltese language or the English language, endorsed

by the competent authority of the State where he is established,

that he is taxable person for the purposes of value added tax in

that State. However, where the Commissioner already has such

evidence in his possession, the taxable person shall not be

required to produce new evidence for a period of one year from

the date of issue of the first certificate by the competent authority

of the State in which he is established<

(c) certify by means of a written declaration that he has

supplied no goods or services deemed to have been supplied in

Malta during the period referred to in the first and second

sentences of the first subparagraph of paragraph (1) of regulation

8 of these regulations<

(d)

undertakes to repay any sum paid in error.

In order to be eligible for the refund, any taxable person

who has supplied in Malta no goods or services deemed to have

been supplied in Malta other than the services referred to in regulation

2 (1) (a) and (b) of these regulations shall>

(a) satisfy the requirements laid down in regulation 4 (a),

(b) and (d) of these regulations<

(b) certify by means of a written declaration that, during

the period referred to in the first and second sentences of the

first subparagraph of paragraph (1) of regulation 8 of these

regulations, he has supplied no goods or services deemed to

have been supplied in Malta other than services referred to in

regulation 2 (1) (a) and (b) of these regulations.

(1) For the purposes of these regulations, goods and Conditions.

services in respect of which tax may be refundable shall satisfy the

conditions laid down in articles 22 and 23 of the Act.

(2) These regulations shall not apply to supplies of goods,

which are or may be exempted under item 1(2) of Part One of the

Fifth Schedule to the Act.

The Commissioner may not impose on the taxable persons Imposition of

obligations.

any other obligations, in addition to those referred in regulations 4

and 5 of these regulations, other than the obligation to provide, in

specific cases, the information necessary to determine whether the

application for refund is justified.

(1) The application for refund provided for in regulations Period to be

covered.

4 and 5 of these regulations shall relate to invoiced purchases of

goods or services or to imports made during a period of not less

than three months and not more than one calendar year. Such

applications may also relate to invoices or import documents not

covered by previous applications and concerning transactions

completed during the calendar year in question.

The application shall be completed either in the Maltese

language or in the English language and shall be submitted to the

Commissioner of VAT, Centrepoint Building, Ta’ Paris Road,

Birkirkara, CMR 02, Malta, within six months from the end of the

calendar year in which the tax became chargeable.

If the application relates to a period of less than one calendar

year but not less than three months, the amount for which the

application is made may not be less than eighty liri (Lm80)< if the

application relates to a period of one calendar year or the remainder

of a calendar year, the amount may not be less than ten liri (Lm10).

The Commissioner may round up or down, by up to 10 percent,

the figures resulting from this conversion into national currency.

(2) The Commissioner shall stamp each invoice and, or

import document to prevent their use for further application and shall

return them within one month.

(3) Decisions concerning applications for refund shall be

given within six months from the date when the applications,

accompanied by all the necessary documents required under these

regulations for the examination of the application, are received by

the Commissioner. Refunds shall be made before the end of this

period, at the applicant’s request, either in Malta or in the State where

he is established. In the latter case, the bank charges for the transfer

shall be payable by the applicant.

The Commissioner shall state the ground for refusal of an

application. Appeals against such refusal may be made to the Value

Added Tax Appeals Board in Malta, subject to the same conditions

as to form and time limits as those governing claims for refund made

by taxable persons established in Malta.

(4) Where a refund has been obtained in a fraudulent or

in any other irregular manner, the Commissioner shall proceed

directly to recover the amounts wrongly paid and any penalties and

interest imposed by regulation 9 of these regulations, without

prejudice to the provisions relating to mutual assistance in the

recovery of value added tax>

In the case of fraudulent applications which cannot be made

the subject of an administrative penalty, the Commissioner shall

refuse for a maximum period of two years from the date on which

the fraudulent application was made any further refund to the taxable

person concerned. Where an administrative penalty had been

imposed and interest has become due, but has not been paid, the

Commissioner shall suspend any further refund to the taxable person

concerned until it has been paid. Furthermore the Commissioner

shall have the right to deduct such administrative penalty and interest

from any future refunds claimed by that taxable person.

Where a refund has been obtained in a fraudulent or any

other irregular manner, as outlined in paragraph (4) of regulation 8

of these regulations, an administrative penalty equivalent to twenty

per cent of the amount unduly received shall become due, together

with interest at the rate of one per cent per month or part thereof

which interest shall start to run from the date of payment of the

amount unduly received to the date when such amount together with

the administrative penalty and interest is paid back to the

Commissioner.

Provided that the amount of such administrative penalty and

interest taken together shall not exceed the amount obtained in a

fraudulent or any other irregular manner.

The certificate referred to in regulation 4(b) of these Certificate.

regulations, establishing that the person concerned is a taxable

person, shall be made in the form specified in the Second Schedule

to these regulations.

The payment of the refund shall be made in euro or in Method of

payment.

national currency, according to the choice of the taxable person, by

bank draft posted to the address shown on the application, or in an

account in Malta designated by the taxable person.

Mitbug[ fl-Istamperija tal-Gvern — Printed at the Government Printing Press