Malta

Goods

This guide is for e-commerce companies that sell online via web-stores or at marketplaces to Maltese consumers.

 

VAT Standard rate 
18% 

 

VAT Reduced rate
7% 

  • Accommodation in a hotel or guest house
  • Accommodation in any premises, where for the purpose of that accommodation, it is required that the premises be licensed in terms of the Malta Travel & Tourism Act.
  • Use of sporting facilities 

 

5 % 

  • Supply of electricity
  • Confectionery and other edible items
  • Medical Accessories
  • Printed Matters
  • Certain Items for the exclusive use of the disabled
  • Minor repairing of bicycles, shoes and leather goods, clothing and household linen (including mending and alteration)
  • Domestic care services such as home help and care of the young, elderly, sick or disabled
  • Admission to museums, art exhibitions, concerts and theatres. 

 

0% 

  • Food for human consumption
  • Pharmaceutical products
  • Scheduled bus service (tal-linja)
  • Domestic inter-island sea passenger transport
  • International passenger transport
  • Exports
  • Intra-community supplies of goods 

 

Thresholds
35000 EUR – distance sales threshold 

If the distance selling registration threshold is exceeded, it is necessary to register with VAT in Malta. 

€ 0  

  • If a seller uses local warehouse   
  • If a seller sells excise goods, such as tobacco or alcohol 

 

Deductible VAT 
If goods or services were used to make taxable supplies in Malta, VAT in input invoices might be credited. Examples include: 

  • VAT paid at custom clearance with your EORI number 
  • VAT paid to Maltese suppliers 

Registration procedure

When a company has the obligation to register, the owners will be required to complete and submit a VAT registration form using the CFR Registrations Online Services, along with supporting documentation:

  • Trade register extract
  • VAT certificate
  • Articles of Associations
  • ID of the Director
  • If the company is appointing a local tax agent or Fiscal Representative, then a Letter of Authority or Power of Attorney

All the docs should be translated to English language.

Tax representative

There is no need for non-UE companies to appoint fiscal representative in order to handle all formalities related to VAT registration and filling.

Keeping records

Records about performed transactions must be kept in order to check the correctness of tax returns and payments. The retention period for the records is ten years.

VAT payment date

The VAT due should be paid by filing deadline for the VAT return to which it relates.

Filing VAT returns

A VAT Return for every VAT period shall be submitted to the Commissioner for Revenue by 1 month and 15 days from the end of the respective VAT period. The VAT period typically would be a period of 3 calendar months. Exceptions apply where a tax period may be of more or less than 3 months. A 12 month VAT period applies where the value of sales made does not exceed the relevant ‘Exit Threshold’. Monthly VAT periods may also be applied at the discretion of the Commissioner for Revenue.

Digital services

Effective since 1 of December 2016.  

It doesn’t matter where you are, it matters where your customers are. Your customer’s location determines what VAT you charge. 

 

VAT Standard rate
18% 

VAT Reduced rate
There is no reduced rate established. 

 

VAT calculation peculiarity
VAT= Total revenue * 18/118 

Threshold
Tax threshold is €0 for digital goods. 

Pieces of evidence

A NETP (known as the Non-Established Taxable Person) who is established outside the EU and who chooses Malta as his place of identification has to apply to the Commissioner of Revenue by electronic means stating when his taxable activity commences. 

He should also furnish the following information: 

  • Name 
  • Postal address 
  • Electronic addresses, including web sites 
  • National tax number, if any 
  • Declaration, that he is not identified for value added tax purposes within the Community 

E-services list

A digital product is any product that’s stored, delivered, and used in an electronic format. These are goods or services that the customer receives via email, by downloading them from the Internet, or through logging into a website. 

Electronic services are defined as: 

  • Services relating to website supply 
  • Web-hosting 
  • Distance maintenance of programmes and equipment 
  • Supply of software and updating thereof 
  • Supply of images, text and information, and making databases available
  • Supply of music, films and games, including games of chance and gambling games 
  • Supply of political, cultural, artistic, sporting, scientific and entertainment broadcasts and events 
  • Supply of distance teaching. 

Registration procedure

For VAT registration non-resident businesses can apply to the VAT Department’s headquarters by post or by submitting an online application through the VAT Department website. The Maltese Vat Department will require the appropriate forms to be completed, and submitted with the following documentation: 

  • Copy of Articles of Association 
  • Copy of the certificate of registration at the Companies’ Register 
  • Copy of the passport or identity card of the director signing the VAT registration application 

Registration usually takes three to four weeks. Once the registration has been granted, a unique Maltese VAT number is allocated to the company. All EU member states have a fixed format for their VAT numbers. In Malta, the format of the number depends on the category of registration. 

Keeping records

In order to comply with VAT laws, Maltese invoices must include the following information: 

  • Your business’ name and address 
  • Our business’ VAT number 
  • Invoice date 
  • Invoice sequencing number 
  • Buyer’s name and address; 
  • Buyer’s VAT number. If you are using the reverse charge mechanism, you must also add the text «EU VAT reverse charged»
  • VAT (amount and rate) applied to each item 
  • Final amount after VAT is added 
  • The currency used 

Maltese VAT invoices must be issued within six months after you delivered the product or service.  Then you need to store these invoices electronically for ten years. Yes, that sounds excessive, but you must keep them on file in case any authority wants to verify your tax history. 

VAT payment date

Issuing invoices, no later than the 15th day of the month following the chargeable event, with the disclosure details outlined in the Maltese VAT Act. Electronic invoices with proper signature, authenticity and agreement by the recipient. 

Filing VAT returns

EU VAT returns are due quarterly. At the end of each quarter, you have 20 days to file and pay whatever you owe: 

  • 20 April, for the first quarter ending 31 March 
  • 20 July, for the second quarter ending 30 June 
  • 20 October, for the third quarter ending 30 September
  • 20 January, for the fourth quarter ending 31 December