REFUND OF VALUE ADDED TAX TO TAXABLE PERSONS NOT ESTABLISHED IN THE TERRITORY OF THE COMMUNITY REGULATIONS

SUBSIDIARY LEGISLATION 406.11

REFUND OF VALUE ADDED TAX TO TAXABLE

PERSONS NOT ESTABLISHED IN THE TERRITORY

OF THE COMMUNITY REGULATIONS

1st May, 2004

LEGAL NOTICE 220 of 2004, as amended by Legal Notices 125 of 2005,

426 of 2007, 105 of 2008 and 94 of 2012.

(1) The title of these regulations is the Refund of Value

Added Tax to Taxable Persons not established in the Territory of

the Community Regulations.

(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.

(Regolament 4)

RIFU|JONI TA’ TAXXA FUQ IL-VALUR MI|JUD LILL-PERSUNI

TAXXABBLI MHUX STABBILITI FIT-TERRITORJU TAL-KOMUNITÀ

RIFU|JONI TA’ TAXXA FUQ IL-VALUR MI|JUD LILL-PERSUNI

TAXXABBLI MHUX STABBILITI FIT-TERRITORJU TAL-KOMUNITÀ [L.S.406.11

IT-TIENI SKEDA (Regolament 4)

For the purposes of these regulations, unless the context

otherwise requires

"the Act" means the Value Added Tax Act;

"a taxable person not established within the territory of the

Community" means a taxable person who during the time of supply

in question, does not have his business nor a fixed establishment

from which business transactions are effected, or, if no such

business or fixed establishment exists, his permanent address or

usual place of residence in the territory of the Community, 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, 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 resident abroad.

"territory of the Community" means the territories defined in the

Sixteenth Schedule to the Act;

"a taxable person not established in Malta" means 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.

(1) Without prejudice to regulations 4 and 5, the

Commissioner of VAT shall refund to any taxable person not

established within the territory of the Community, 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(a) and (b).

(2) Without prejudice to regulations 4 and 5, the Commissioner

of VAT shall refund to any taxable person not established in Malta

but in the territory of the Community, 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 supplies referred to in article 22(4)(c) of the Act or

for the purposes of other supplies than those mentioned in the

Refund of Value Added Tax to Taxable Persons not established in

Malta Regulations, which taxable persons are established in the

territory of the Community and who realise only in Malta

operations allowed by these regulations, for which they should not

register in Malta under article 10 of the Act.

(3) Refunds to taxable persons not established in the territory

of the Community shall be made with the exception of refunds of

input VAT related to electronically supplied services provided by

taxable persons registered in the territory of the Community under

the special scheme referred to in Part Seven of the Fourteenth

Schedule to the Act.

(4) The Commissioner may, by means of a notice in writing,

require the appointment of a tax representative, with the exception

of taxable persons established in the territory of the Community

and taxable persons providing electronically supplied services

referred to in subregulation (3).

(1) The refunds referred to in regulation 3(1) shall be

granted upon application by the taxable person on the form

pr escribed in the First Schedule. Su ch application shall be

com pleted 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 one hundred and

eighty-six euro (€186); 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 twenty-three euro (€23).

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

cent, the figures resulting from this conversion into national

currency.

(2) The application shall contain the following information

and, or documentation

(a) an official certificate drawn up on the form prescribed

in the Second Schedule completed either in the

Maltese language or in the English language, and

endorsed by the competent authority of the country

where that taxable person is registered for VAT or

where he exercises his economic activity;

(b) the original valid invoices and, or valid importation

documents.

(3)

Refund may not be granted

(a) with respect to refunds to taxable persons not

established in the territory of the Community, under

conditions which are more favourable than those

applied to Community taxable persons;

(b) on supplies made by that taxable person where his

business would, by its nature, be treated as exempt

without credit if such business had been carried on in

Malta.

(1) 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 country

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

transfer shall be payable by the applicant.

(2) The Commissioner shall state the ground for refusal of an

application. Appeals against such refusal may be made to the

Administrative Review Tribunal 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.

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 7, 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

o t h e r i r r e g u l a r m a n n e r, a s o u t l i n e d i n r e g u l a t i o n 6 , a n

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 payment of the refund shall be made in euro or in

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

bank draft posted to the address shown on the application.

(1) For the purposes of these regulations, eligibility for

refunds shall be determined in accordance with the provisions of

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.

FIRST SCHEDULE (Regulation 4)

SECOND SCHEDULE (Regulation 4)