SKILLS DEVELOPMENT (2024) REGULATIONS

SKILLS DEVELOPMENT (2024)

SUBSIDIARY LEGISLATION 463.54

SKILLS DEVELOPMENT (2024) REGULATIONS

1st January, 2024

LEGAL NOTICE 54 of 2024.

The title of these regulations is the Skills Development

(2024) Regulations.

In these regulations, unless the context otherwise

requires

"Act" means the Malta Enterprise Act;

"Corporation" shall have the same meaning assigned to it

in the Act;

"Guidelines" means the Guidelines as may be published

by the Corporation from time to time in accordance with the

Act, establishing the parameters of implementing the aid

granted by virtue of these regulations;

"large undertaking" means any enterprise that does not

qualify as a small undertaking or a medium-sized undertaking;

"medium-sized undertaking" shall have the same

meaning assigned to it in Annex I of the Commission

Regulation (EU) No 651/2014 of 17 June 2014 declaring

certain categories of aid compatible with the internal market in

application of Articles 107 and 108 of the Treaty, as amended

from time to time;

"small undertaking" shall have the same meaning

assigned to it in Annex I of the Commission Regulation (EU)

No 651/2014 of 17 June 2014 declaring certain categories of aid

compatible with the internal market in application of Articles

107 and 108 of the Treaty, as amended from time to time;

"undertaking" shall have the same meaning assigned to it

in the Act.

(1)

When the Corporation is satisfied that an

undertaking carrying out or intending to carry out an economic activity

that may contribute to the economic development of Malta, requires

aid to increase the skills and knowledge of its employees in relation to

the requirements of their employment through training, the

Corporation may provide such an undertaking with a tax credit or a

cash grant or a combination of both, in accordance with the terms and

conditions set out in the Guidelines.

SKILLS DEVELOPMENT (2024)

(2)

The Corporation shall in principle only consider

awarding cash grants

(a)

to undertakings engaged in manufacturing and

maintenance, repair and overhaul of electromechanical

equipment; or

(b)

to support training initiatives related to

investment projects that result in the creation of a new

establishment, significant expansion of the current activities of

an establishment or the diversification of an establishment into

products or services not provided previously by the

undertaking.

(1)

Any aid provided in accordance with these

regulations shall not exceed

(a)

seventy per cent (70%) of the eligible costs in the

case of an undertaking which qualifies as a small undertaking;

(b)

sixty per cent (60%) of the eligble costs in the

case of an undertaking which qualifies as a medium-sized

undertaking;

(c)

fifty per cent (50%) of the eligible costs in the

case of an undertaking which qualifies as a large undertaking.

(2)

The maximum aid for each skills development project

shall not exceed two million euro (€2,000,000).

(3)

The aid intensity may be increased by ten percent (10%)

when training is provided to workers with disabilities, however the aid

intensity shall not exceed seventy per cent (70%).

(1)

An undertaking benefitting from tax credits in

accordance with these regulations and the respective Guidelines, shall

be entitled to deduct from the amount of income tax which is due on its

chargeable income derived from its trade or business in the year of

assessment immediately following the grant of the tax credit, an

amount equivalent to the tax credits granted.

(2)

An undertaking that in any year of assessment, does not

utilise any tax credit granted to it or deducts a value from the amount

of income tax which is due on its chargeable income derived from its

trade or business that is less than the tax credit granted to it, shall carry

forward the unutilised tax credit for the subsequent years of

assessment.

(3)

Tax credits granted in accordance with the regulations

and the respective Guidelines shall not give rise to a right to a refund

of tax.

SKILLS DEVELOPMENT (2024)

(4)

Where an undertaking has benefitted a tax credit granted

in accordance these regulations, the tax credit shall be deemed to have

relieved from tax that part of the undertaking’s chargeable income

which, when multiplied by the rates of tax at which it was chargeable

in that year is equal to the tax credit, and where the undertaking is a

company and such undertaking or any subsequent company distributes

the income which is so deemed to have been relieved from tax, such

undertaking shall state in the dividend warrant pertaining to any such

tax distribution that such income has been relieved from tax by a tax

credit in accordance with this regulation.

(5)

(a)

In the case of an undertaking which is a company,

the chargeable income which is deemed to have been relieved from tax

in accordance with sub-regulation (4) shall, for the purposes of the

Income Tax Act, be allocated to the respective tax accounts of the

company in question in accordance with the Tax Accounts (Income

Tax) Rules and any dividends, or part thereof, distributed from such

income shall be exempted from income tax in the hands of the

members of the company on receipt of such distribution;

(b)

where a dividend referred to in paragraph (a) is

distributed to a member which is also a company, in this sub-

regulation referred to as "the second company", the said

dividend shall likewise be distributed by the second company to

its members in the form of dividends exempt from income tax

in the hands of the recipients, and where a member of the

second company is also a company, the preceding provisions

shall apply mutatis mutandis as though references to the first

company were references to the second company, and as though

references to the second company were references to that

member, and the principle set out in this sub-regulation shall

continue to be applied for as long as such income, or part

thereof, to which this regulation applies are distributed by way

of dividends.

(6)

A tax credit shall not be due to an undertaking in

accordance with this regulation unless it is claimed in the appropriate

section of a tax return submitted by electronic means by not later than

the relative tax return.

(1)

The Corporation shall establish a deadline for the

submission of applications in the Guidelines.

(2)

An aid shall not be granted under these regulations by the

Corporation after the 31st of December 2026.

In the eventuality that a new scheme is issued, the

provisions in respect of which the aid was granted prior to the issuance

of the new scheme shall continue to apply thereto.