Fiscal related measures & schemes launched during COVID-19

Latest updates: 20 July 2020 communication

Postponement of certain tax payments – an update

One of the first measures to be announced by Government on the 18 March 2020 to assist businesses experiencing a significant downturn in turnover as a result of the COVID-19 pandemic, was the postponement of certain tax payments (provisional tax payments, payroll taxes, self-employed social security contributions and VAT) falling due between March and June 2020. Applications for such deferral scheme had to be submitted by eligible persons (subject to criteria) by 15 May 2020.

The Commissioner for Revenue has recently announced that this measure has been extended further to cover provisional tax, social security contributions of self-employed persons and VAT falling due up to and including August 2020. There were no further extensions with respect to employee final settlement taxes, maternity fund payments and social security contributions, and any such payroll taxes that fall due from July 2020 onwards should be settled by their respective statutory deadline dates. 

In terms of this extension, the deferred tax payments (including payroll costs incurred during the period March – June 2020) should be paid by 31 May 2021, and no interest or penalties will be charged thereon.

The deferral continues NOT to apply to all other taxes (e.g. settlement tax for the year of assessment 2020). 

Eligible persons who have already submitted their application and want to avail of this extension need not apply again.  

9 July 2020 communication

COVID-19: Wage Supplement for July to September 2020: New NACE Code lists

Malta Enterprise Corporation has issued a revised list of NACE code categories for the purposes of the COVID Wage Supplement applicable from July to September.

 

The revised wage supplement mechanism for the coming three months forms part of the economic stimulus package announced on the 8 June 2020 by the Prime Minister, the Minister for Finance and Financial Services and the Minister for the Economy, Investment and Small Businesses to help regenerate the Maltese economy following the COVID-19 pandemic.

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Wage Supplement

30 June 2020 communication 

COVID-19 Emergency Trade Promotion Scheme

Trade Banner

The COVID-19 pandemic has severely affected trade on an international level. In order to assist and support Maltese undertakings that engage with foreign markets through international trade events, TradeMalta Ltd has launched a temporary scheme to provide assistance to certain undertakings impacted by cancelled international trade events or that are investing in digital marketing.

Find out more

Latest Update:7 June 2020 communication 

COVID-19: Remaining Vigilant Against a Changing Criminal Landscape

It has now become clear that the virus is a breeding ground for criminals and criminal organisations seeking to exploit the situation. As part of its ongoing assessment of the situation, the FIAU would like to advise on current and anticipated threats, address arising concerns, and remind subject persons to remain vigilant in the face of ML/FT risks.

Criminal landscape trends across Europe:

  • Fraudulent sale of medical products.
  • Benefit and compensation scheme fraud.
  • Cyber attacks.
  • Payment fraud.
  • Exploitation material (child/sexual.
  • Trade-in illegal goods.

Main changes shaping criminal activities due to COVID-19.

  • Cash intensive businesses that were previously misused to launder dirty money have slowed down or halted their economic activity. This has restricted the channels used for money laundering, resulting in large volumes of cash waiting to be laundered.
  • Persons in difficult financial situation may become easy targets for recruitment by both criminal and terrorist organizations.
  • The real estate sector continues to be attractive to criminal.
  • Corruption related to issuance of public aid schemes.

Recommended actions to mitigate ML/TF risks:

  • Revising the Business Risk Assessment: focus on the products and services offered.
  • Updating Customer Risk Assessment: focus on the industry and transaction monitoring.
  • Comply with Maltese AML/CFT Regulations and FIAU's Implementing Procedures.

The global pandemic has evidently shifted the way business is carried out, with more subject persons now working away from their physical offices and branches. FIAU is reminding about the rules associated with remote onboarding procedures (refer to FIAU Implementing Procedures Part I Section 4.3.1.2).

FIAU Guidance Note 

cyber attacks

13 May 2020 communication 

Postponement of certain tax payments - an update

One of the measures announced by Government to aid businesses impacted by the COVID-19 pandemic is the postponement of certain tax payments (provisional tax payments, payroll taxes, self-employed social security contributions and VAT) falling due by the end of March and April 2020.

The Commissioner for Revenue recently announced that this measure has been extended to cover eligible payments falling due by the end of May and June 2020. Accordingly, the deadline for the submission of the application was moved to 15 May 2020. The deferred payments should be submitted to the Commissioner for Revenue by 31 October 2020.

Companies and self-employed persons who have already submitted their application when the measure was first announced for payments falling due by the end of March and April 2020 need not apply again, and the announced extension covering May and June payments should automatically apply. Read more for further information on this measure, including details on who is eligible and other applicable conditions.

Read more

 7 May 2020 communication

COVID-19 Research and Development Fund

The Malta Council for Science and Technology (‘MCST’), together with Malta Enterprise Corporation have issued a call for proposals under the COVID-19 R&D Fund to encourage eligible public, academic and private entities with an operating base in Malta to engage in research and development (‘R&D’) activities with the aim of identifying innovative and improved approaches for the prevention, control and containment of the COVID-19 and/or future infectious diseases.

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28 April 2020 communication

Extension to the deadline for the submission of Provisional Tax payments

 The Commissioner for Revenue has announced that in light of the COVID-19 pandemic, unlike prior years, requests for the payment of provisional tax have not been mailed out this year. The amount of provisional tax due can be obtained through this link. 

Furthermore the deadline for the submission of provisional tax payments, which were due by 30 April 2020 has now been extended to 31 May 2020

Postponement of the payment of Excise Duty

Further to the Government measures introduced during the last couple of weeks to alleviate imminent cash flow and liquidity issues faced by businesses in light of the COVID-19 outbreak, a further measure has been introduced into Maltese law by virtue of the Deferment of Excise Duty payable during the Months of April and May 2020 Regulations, 2020 (L.N. 147 of 2020) ("The Regulations"). 

The Regulations provide that payments of excise duty on all excise goods and services which are otherwise due to be made during the months of April and May have been extended by a period of 60 days from when they are otherwise due, subject to the following time limits:

  • in respect of payments otherwise due during the month of April, not later than the 28th June 2020
  • in respect of payments otherwise due during the month of May, not later than the 26th July 2020.

6 April 2020 communication

Malta Development Bank launches the COVID-19 Guarantee Scheme (CGS)

The Malta Development Bank launched the MDB COVID-19 Guarantee Scheme (CGS), on the 3 of April, providing a €350 million fund, as a guarantee for commercial banks accredited by the MDB to provide €777.8 million in new working capital loans. The loans are to support all types of businesses in Malta to meet cashflow disruptions due to the effects of the COVID-19.  

Businesses are to benefit from improved access to liquidity, at lower interest rates and with a repayment period of up to six years. In addition, the CGS will provide a six-month moratorium on both the interest payments as well as on capital repayments. The moratorium period can be extended by the commercial banks to one year on a case by case basis. Loan applications are assessed by the commercial banks in line with their credit policy criteria. Final approval rests with the commercial banks.

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3 April 2020 communication

EU Grant Schemes for SMEs

In view of the present situation, where businesses are having to re-think their business strategy or implement actions especially by offering their products or services through an e-commerce facility to mitigate against the repercussions due to COVID-19, the Measures and Support Division are administering Grant Scheme 2: e-Commerce and Grant Scheme 7: SME Consultancy Services on a more regular basis for entities that qualify as SMEs.

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Grant schemes for SMEs

2 April 2020 communication

FATCA & CRS report updates

The Commissioner for Revenue has published an extension to the deadline for the submission of FATCA & CRS reports. The deadline for submission of FATCA & CRS reports both in XML format and using the alternative format (excel sheet) is now the 30th of June 2020.

Access the guidelines

 

25 March 2020 communication

Some considerations relating to Corporate Governance

Running their business in the midst of a pandemic is an unprecedented challenge for business leaders worldwide. The restrictions imposed by many governments all over the world in handling the COVID-19 outbreak raise significant challenges as regards corporate governance.

We have set out below a number of issues and risks our clients are currently facing in the day-to-day running of their businesses. Their extent and impact will naturally vary with the nature and size of a business, but the approach taken in respect of these issues could be crucial for the particular business to thrive or at least survive this new reality.

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Some corporate relating to Corporate Governance

23 March 2020 communication

MFSA and FIAU COVID-19 related deadline extensions

Local regulatory authorities are also reacting to these challenging times for regulated entities. The MFSA will be making exceptions to some reporting deadlines due to be met by regulated entities across all sectors in March or April 2020. These include extensions for the submission of audited financial statements and regulatory reporting- in some cases extensions are to be applied for on a case by case basis while in others, a 2 months extension has been granted. On the AML/CFT front, the FIAU has extended 2020 Risk Evaluation Questionnaires deadline to 4 May 2020.

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20 March 2020 communication

COVID-19: Tax payment deferral scheme application form

Further to the recently announced fiscal support measures intended to aid businesses that are negatively impacted by the COVID-19 outbreak, the online application form through which companies and self-employed persons can apply for the postponement of certain taxes due in March and April 2020 has now been issued. This, together with further information on the said measures, can be accessed below.

Access application form

If you require any further guidance on the measures being introduced or assistance in applying for a deferral please contact one of our specialists.

18 March 2020 communication

Financial aid package and measures introduced in light of COVID-19

In addition to the measures announced earlier this week, this evening the Prime Minister, the Minister for Finance and Financial Services and the Minister for the Economy, Investment and Small Businesses announced a number of measures aimed at supporting the business community against the negative effects of the COVID-19 pandemic. 

The measures announced have a value of around €1.8bn, which represents around 12.9% of Malta’s Gross Domestic Product (GDP) in 2019.

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COVID-19: Fiscal support measures for businesses

The Maltese Government has announced a number of measures in a bid to encourage retention of employees and alleviate imminent cash flow and liquidity concerns that are expected to be faced by certain local businesses in the light of the COVID-19 outbreak. These initiatives are mainly targeted at those businesses that are suffering a significant downturn in their turnover as a result of the economic constraints arising from the Coronavirus pandemic and, as a result face substantial cash flow difficulties.

More measures may be announced in future as the need arises.

Read more

 

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David Valenzia

David Valenzia

Territory Senior Partner, PwC Malta

Tel: +356 2564 6892

Joseph Camilleri

Joseph Camilleri

Assurance Partner, PwC Malta

Tel: +356 2564 7090

Elizabeth Camilleri

Elizabeth Camilleri

Senior Manager, Marketing & Communications, PwC Malta

Tel: +356 2564 6734

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