Keeping up to date: Malta Enterprise and other support measures

L.N. 152 of 2020 
MALTA ENTERPRISE ACT (CAP. 463) 
Skills Development (Amendment) Regulations, 2020

The Skills Development Scheme is intended to support training and knowledge transfer initiatives taken by specific eligible undertakings and which satisfy prescribed criteria. This Scheme was first issued in September 2018 however various amendments have recently been made thereto.

This measure is available to duly registered undertakings, including self-employed persons, that carry out in Malta at least one of a number of varied qualifying activities specifically prescribed in the applicable Guidelines, to which recently have been added the construction sector and financial and insurance activities.

At application stage, the undertaking is required to employ at least 5 full-time employees and the relevant training must lead to the acquisition of skills, knowhow or knowledge. Team building activities, training which relates to company focused actions specific to the employer (e.g. training on the corporate culture, values, organisational behavior, etc,) and training related to gambling are excluded.

Aid is granted in the form of tax credits, which may be carried forward to subsequent years of assessment for a period of up to 10 years, but in particular instances, may be partly given in the form of a cash grant.

The aid intensity depends on the size of the undertaking and is calculated as a percentage (ranging from 50% for large undertakings to 70% for small undertakings) of eligible costs, which include wage costs (subject to conditions), consultancy costs, air travel expenses and rental of training rooms. The maximum support per skills development project shall be of €2,000,000.

This Scheme is applicable until 31 December 2022. Application forms should reach Malta Enterprise Corporation by 30 November 2022.  

L.N. 335 of 2019
MALTA ENTERPRISE ACT (CAP 463)
Start-Up Finance 2020

This Scheme is intended to support eligible small start-up undertakings that demonstrate a viable business concept to expand and further their economic activity. A start-up undertaking is defined as any unlisted small enterprise up to 5 years following its registration which satisfies a number of conditions and criteria and which is engaged in a qualifying economic activity, including manufacturing, software development, pharmaceuticals and other innovative economic activities.

A project may be considered eligible for assistance if it meets two of the following criteria:

a)  propose products and/or services that have the potential to generate income from variou geographical markets;

b)  produce products and/or service which are new or substantially improved compared to complementary products on the market;

c)  utilise processes which are new or substantially improved compared to those adopted in current complementary activities.

Through this Scheme, Malta Enterprise Corporation may provide support linked to private equity, wage costs, crowd funding, procurement of tangible and intangible assets, and participation in a recognized Start-Up Accelerator program that essentially provides connections, mentorship, training and other support culminating in a pitch event through which the start-up undertaking may receive equity from private or institutional investors.

The support provided under this Scheme varies from a onetime Accelerator Grant to repayable advances of amounts depending on the type of category the start-up undertaking is applying under. In any case, the assistance is capped at €400,000 which may be increased to up to €800,000 if the Start-up is an ‘Innovative Enterprise’ as defined in the relevant Guidelines.

This incentive shall be available from 1 January 2020 until the 31 December 2022. A start-up undertaking may apply under this Scheme by submitting an application form to Malta Enterprise Corporation within 36 months from the start-up date.

L.N. 285 of 2019
MALTA ENTERPRISE ACT (CAP 463)
Interest Rate Subsidy Regulations, 2019

This Scheme is intended to assist eligible undertakings by subsidizing interest charged on a loan, issued by a bank licensed to operate in Malta, in order to finance the acquisition of certain tangible assets required for an eligible initial investment project (as defined). This Scheme is applicable to undertakings engaged in qualifying economic activities, including manufacturing, Information Technology and pharmaceuticals, amongst others.

Support consists of an interest rate subsidy of up to 3% per annum provided by Malta Enterprise Corporation. Irrespective of the term of the loan, the subsidy is only available for a maximum period of ten years from the date of initial drawdown.

The value of the aid under this Scheme is calculated by way of a prescribed discounting formula but in any case, the value in gross grant equivalent is capped at 30%, 20% and 10% of qualifying expenditure for small, medium-sized and large undertakings respectively.

This Scheme is applicable until the 31 December 2022. Application forms to avail of such Scheme should reach Malta Enterprise Corporation prior to the commencement of the investment project.

L.N. 282 of 2019
INCOME TAX ACT (CAP 123)
Qualifying Employment in Innovation and Creativity (Personal Tax) Rules

This Scheme is aimed at facilitating the employment of non-Maltese residents in roles which are not specifically addressed by the current Maltese labour market, by providing fiscal incentives to non-Maltese residents and individuals not domiciled in Malta coming to work in Malta under specific conditions.  

Individuals may avail of this fiscal incentive subject to the satisfaction of criteria including:

(i)  possession of a relevant qualification or experience,

(ii)  employment in an eligible office (very broadly, a role directly engaged in the carrying out or management of prescribed activities in research and development), and

(iii) earning a minimum income of €52,000 from a qualifying contract of employment. Furthermore, the individual must not benefit from exemptions provided under the Income Tax Act, specifically those applicable for insurance and investment services expatriates, and must not acquire immovable property in Malta or any real rights thereon.

The incentive consists of a reduced tax rate of 15% on the employment income which is applicable for a consecutive period of up to 4 years, which may be extended for specific periods by approval from Malta Enterprise Corporation.

Specific considerations apply in the case of terminations of employment.

Determinations under this Scheme will be issued by Malta Enterprise Corporation until 31 December 2025, and no further benefits may be availed after year of assessment 2030.

L.N. 273 of 2019
MALTA ENTEPRISE ACT (CAP 463)
Brexit Support Scheme Regulations

This Scheme is designed to support business undertakings operating in Malta with access to advisory services and guidance so as to review and address disruption which may be caused or which have occurred due to Britain’s exit from the European Union (Brexit).

The aim of the incentive is to assist undertakings to analyse the possible effects of Brexit on their business and to develop appropriate business strategies to mitigate the impact of Brexit and maximise business opportunities that Brexit might create.

This measure is available to duly registered SMEs carrying out an economic activity in Malta and that at the point of application employ at least two persons. The undertaking is required to justify significant dependency on the British market which shall be considered if for the last 2 years 20% of the undertakings’ turnover was dependent on transactions related to the British market.

This Scheme provides for aid in the form of a cash grant that covers up to 50% of costs incurred for Brexit-related consultancy services provided by an external professional service provider, up to a maximum of €5,000.

Interested applicants may apply under this Scheme by submitting an application form prior to the commencement of the advisory services. This Scheme is applicable until 31 December 2020 (subject to budget availability).