Malta Retirement Programme (Amendment) Rules, 2014

L.N. 269 of 2014

INCOME TAX ACT

(CAP. 123)

Malta Retirement Programme (Amendment) Rules, 2014

IN exercise of the powers conferred by articles 56(23) and 96 of

the Income Tax Act, the Minister for Finance has made the following

(1) The title of these rules is the Malta Retirement Citation and

Programme (Amendment) Rules, 2014, and these rules shall be read commencement.

and construed as one with the Malta Retirement Programme Rules, S.L. 123.134

hereinafter referred to as "the principal rules".

(2) These rules shall be deemed to have come into force with

effect from 1st July, 2013.

Rule 2 of the principal rules shall be amended as follows

Amends rule 2

of the principal

rules.

(a)

immediately after the definition of "EEA" there

shall be added the following new definition

"household staff" means an individual who has

been in an employment relationship, as evidenced by a

contract of service, with the beneficiary for at least two

years prior to the application in terms of rule 3: provided

that the Commissioner is satisfied that the service is

required to be provided in whole or in part within the

qualifying property;";

(b) the proviso to the definition of "qualifying property

holding" shall be substituted by the following

"Provided that the persons who reside in the

qualifying property are not persons other than (a) the

beneficiary, and (b) persons that qualify as his dependants

or household staff provided that the Commissioner has

been notified that such dependents or household staff will

be so residing;";

(c)

the definition of "qualifying owned property" shall

be substituted by the following definition

"qualifying owned property" means an immovable

property purchased

(a) after 1 January 2011 up to 30 June,

2013 at a consideration of not less than

(i) two hundred and seventy-five

thousand euro (€275,000) for a property

situated in Malta; or

(ii) two hundred and fifty thousand

euro (€250,000) for a property situated in

Gozo;

(b) on or after 1 July, 2013, at a

consideration of not less than

(i) subject to the provisions of

paragraph (b), two hundred and seventy-five

thousand euro (€275,000) for a property

situated in Malta; or

(ii) two hundred and twenty thousand

euro (€220,000) for a property situated in

Gozo or in the south of Malta

Provided that an immovable property purchased

before 1 July 2013 for a consideration which is less than

the amounts indicated in paragraph (b) above shall be

considered to be "qualifying owned property" insofar as

the value of such immovable property as declared on the

date of application by the applicant is not less than the

amounts indicated in paragraph (b) above as supported by

a separate and independent architect valuation including

architect’s plan which are delivered to the Commissioner

upon application

Provided further that the Commissioner, or any

officer authorised by him in writing, architect or surveyor

shall have full and free access to the qualifying owned

property to the extent that such access is likely to assist

him in determining the value of the said property;";

(d) the definition of "qualifying rented property" shall

be amended as follows

(i) in paragraph (a) thereof, immediately before

the words "nine thousand and six hundred euro (€9,600)

per annum for a property situated in Malta; or" there shall

be added the words "subject to paragraph (b),";

(ii) paragraph (b) of the definition of "qualifying

rented property" shall be substituted by the following

"(b) eight thousand and seven hundred and

fifty euro (€8,750) per annum for a property

situated in Gozo or in the south of Malta;";

(e)

immediately after the definition of "rights acquired

under this law" there shall be added the following new

"south of Malta" means the areas within

set boundaries as designated in the Second

Schedule to the Local Councils Act of the

localities listed in the Schedule to these

rules;"; and

(f)

the definition of "special carer" shall be

deleted.

Paragraph (a) of rule 4 of the principal rules shall be Amends rule 4

of the principal

substituted by the following

rules.

"(a) he holds a qualifying property holding: provided

that where two individuals are spouses or prove to the

satisfaction of the Commissioner that they are in a stable and

durable relationship with one another, both individuals may

hold jointly the same qualifying property holding;".

Rule 5 of the principal rules shall be amended as follows

Amends rule 5

of the principal

rules.

(a)

at the end of the proviso to sub-rule (1) thereof,

there shall be added the following

"Such minimum amounts are payable in full in both

the year when the special tax status was granted and in the

year when the individual ceases to possess the said special

tax status.".

(b) sub-rule (3) thereof shall be substituted by the

"(3) Notwithstanding any provision in the Income

Tax Acts -

(a) subject to the provisions of paragraph

(b), the minimum tax referred to in the proviso to

sub-rule (1) shall be payable by not later than the

30th April of the year immediately preceding the

relevant year of assessment. Such payment shall be

accompanied by a return made to the

Commissioner that provides proof that all the

requirements of rule 4 continue to be satisfied. The

said return, which shall be in such form as the

Commissioner may determine, does not need to be

submitted in the year in which the special tax status

is granted;

(b) in the case of the year in which the

special tax status is granted, where it is evident that

the special tax status will not be granted before the

30th April, the minimum tax referred to in the

proviso to sub-rule (1) is to be paid before the

special tax status is granted;

(c) any tax paid under the provisions of

sub-rule (1) shall not be refundable."; and

(c)

immediately after sub-rule (3) there shall be added

the following new sub-rule

"(4) (a) Notwithstanding any provision

in the Act, an individual who applies for or

acquires a permanent residence certificate in

terms of article 7 of the Free Movement of

European Union Nationals and their Family

Members Order, will be taxable on any

income accruing in or derived from Malta or

elsewhere, and whether received in Malta or

not in respect of income mentioned in article

4 of the Act and subject to tax at the rates

mentioned in article 56 of the Act.

(b) In the case where the individual

referred to in paragraph (a) is a beneficiary or

dependent, the relevant authorised registered

mandatary shall -

(i)

enquire

and

obtain

information

from

the

relevant

beneficiary as to whether the beneficiary

or any of his dependants has applied for

or acquired the permanent residence

certificate referred to in paragraph (a) as

at the 31st December of each year from

the year of the appointed date onwards;

and

(ii) notify the Commissioner of

any individual that is a beneficiary or

dependent that has applied for or

acquired the permanent residence

certificate referred to in paragraph (a) by

not later than the 30th April following

the 31st December referred to in sub-

paragraph (i) on such form as the

Commissioner may determine. Where

the authorised registered mandatary is

not able to obtain such information, he

is to notify the Commissioner by the

said 30th April of this state of affairs

and provide proof that at least two

attempts at enquiry were made. Where

such notifications are not made within

the time specified, the authorised

registered mandatary shall be charged

an administrative penalty of ten

thousand euro (€10,000).".

Immediately sub-rule (7) of the principal rules, there shall Amends rule 10

of the principal

be added the following new sub-rule

rules.

"(8) Where an authorised registered mandatary

repeatedly fails to carry out a function required under these

rules, he shall cease to be an authorised registered mandatary.

For the purposes of this paragraph, "repeatedly" means more

than two failures of carrying out functions required under these

rules.".

At the end of the principal rules there shall be added the Adds Schedule

to the principal

following

rules.

"SCHEDULE

(Rule 2)

Localities for the purposes of the definition of "south of Malta"

Birżebbuġia

Cospicua

Fgura

Għaxaq

Gudja

Kalkara

Kirkop

Luqa

Marsascala

Marsaxlokk

Mqabba

Paola

Qrendi

Safi

Santa Luċija

Senglea

Siġġiewi

Tarxien

Vittoriosa

Xgħajra

Żabbar

Żejtun

Żurrieq".

€0.54