Similar to its predecessor scheme (the Investment Aid Scheme), the new Invest Scheme provides aid to undertakings engaged in qualifying activities in respect of qualifying expenditure incurred on an initial investment project (as defined). Initial investment projects with a start of works date after 1 May 2022 are considered as eligible under this Scheme.
There are however some important differences:
New forms of aid
Unlike the Investment Aid 2021 Scheme, the Invest Scheme does not only provide for cash grants and/or tax credits but also includes loan guarantees (up to €10m) and interest rate subsidies (between 1% and 3% p.a.), subject to certain conditions and criteria being met e.g. size and activity of the undertaking.
Aid Intensities & Assisted Regions
As anticipated in our previous article, aid under the new scheme may also depend on geographical factors.
Indeed, the aid awarded under the Invest Scheme is calculated as a percentage of qualifying expenditure (as defined) incurred as from 1 May 2022 onwards, depending not only on the size of the qualifying undertaking but in certain instances also on the area in which the investment project is carried out. This is depicted below:
Size of Applicant |
Investment project in an assisted area |
Investment project in Gozo and Comino |
Investment project in non-assisted areas |
Small undertaking |
30% |
35% |
20% |
Medium-sized undertaking |
20% |
25% |
10% |
Large undertaking |
10% |
15% |
N/A |
Small and Medium Sized Enterprises (SMEs) operating in the hospitality sector |
15% |
15% |
10% |
In the case of large undertakings, aid under this Scheme is permissible only in respect of ‘initial investments in favour of a new economic activity or activities’ as long as such activity is not the same or a similar activity to the activity previously performed by the undertaking. That is to say, the activity should fall under a new or different class of the NACE statistical classification of economic activities.
Assisted areas, as defined in the guidelines, are being included below:
Other changes
Other changes include:
Amendments in relation to qualifying activities. For some activities e.g. including R&D, logistics operations relating to the pharma sector, and certain IT activities, such amendments may result in the broadening of scope of the incentive scheme.
The calculation of qualifying expenditure on the basis of wage costs for new jobs created through an initial investment project considers now only full-time employment, i.e. excludes wage costs for part-time, reduced and seasonal employment.
Costs incurred for the purchase of land and other eligible preparatory works required for the purposes of the investment project shall be considered only if incurred after 1 May 2022 and within a 24-month period from the start of works date.
Application Process & Availability of the Scheme
The application process for the Invest Scheme is the same as that applicable under preceding investment aid schemes. Very broadly, this includes the electronic submission of an application form giving details on the investment project to be undertaken and the expenditure to be incurred. Upon approval, the Corporation will issue a letter of approval to the undertaking specifying the maximum amount of aid awarded. Thereafter, the undertaking is required to submit periodic claim forms reporting the actual capital expenditure incurred on the project.
Although this Scheme shall be applicable until 31 December 2023, initial investment projects commencing between 1 May 2022 and 31 December 2026 (or later if the start of works are delayed due to factors beyond the beneficiary’s control) may still qualify for aid. In any case, application forms should be submitted to the Corporation within 6 months from the start of work date in the case of aid in the form of tax credits, however, not later than 30 September 2023.
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