Regularise your VAT Recapitulative Statement filing position now

What is a VAT recapitulative statement?

A VAT recapitulative statement (also known as an EC Sales List) is a periodical statement required to be made by suppliers in Malta who make: (i) any intra-Community supply of goods to customers identified with a valid VAT identification number in another Member State, and / or (ii) any supply of services made to a customer who is liable to pay the tax on that service in another EU Member State in which he is established, except when that service would be exempt from VAT in that Member State. A VAT recapitulative statement therefore summarises the relevant EU sales made by a taxpayer, where no corresponding Malta VAT has been charged during the relevant period.

VAT recapitulative statements are typically filed on a quarterly basis. The deadline for submission of VAT recapitulative statements is the 15th day of the month following the end of the relevant reporting period, and the total amount reported should typically tally with the total value of intra-EU sales reported in Box 1 of the Malta VAT return for the same period. If a taxpayer makes intra-Community supplies of goods to customers identified with a valid VAT identification number in another Member State(s) exceeding the sum of €50,000 either in respect of the quarter concerned or in respect of any of the previous four quarters, a recapitulative statement would have to be submitted on a monthly (instead of quarterly) basis.

One-time concession on penalties

A couple of years back, the Office of the Commissioner for Revenue (‘CfR’) had issued a notice urging VAT registered taxpayers to comply with recapitulative statement filing requirements. More recently, specifically on 4 April 2023, several of the measures announced in the Malta Budget 2023 speech were enacted through the Budget Measure Implementation Act, 2023 (‘Budget Act’), with the measures coming into force, unless otherwise stated, on 4 April 2023. Pursuant to the Budget Act, the administrative penalties applicable to late filing of recapitulative statements have been increased significantly to €50 (up fivefold from €10) for every month or part thereof, with a maximum penalty of €600 (also up fivefold, from €120) for each late recapitulative statement. This significant increase in penalties reinforces the CfR’s previously stated intention to actively enforce taxpayers’ compliance with recapitulative statement filing obligations, and to penalise non-compliance.

Following the recent enactment of the increase in administrative penalties into the VAT Act (chapter 406 of the laws of Malta), the CfR has also published implementing guidelines whereby it has announced that it shall allow a temporary, one-time concession on the imposition of administrative penalties for the late filing of recapitulative statements, to the extent that all recapitulative statements due to be filed by or before 15 September 2023 are filed by no later than that date.

Penalties for non-compliance

Any submissions of recapitulative statements filed after 15 September 2023 will incur the below administrative penalties, depending on the date by which they were originally due:

• Recapitulative statements due for submission after 4 April 2023 shall attract the new penalty of €50 for every month or part thereof that elapses from the date by which any such statement should have been submitted, capped at a maximum of €600 per recapitulative statement.
• Recapitulative statements due for submission before 4 April 2023, shall attract the previously applicable administrative penalty of €10 for every month or part thereof that elapses from the date by which any such statement should have been submitted, capped at a maximum of €120 per recapitulative statement until 15 April 2023, after which the new administrative penalty of €50 for every month or part thereof will be imposed until the date of submission (capped at €600 per recapitulave statement).

It is also pertinent to highlight that non-compliance may also lead to criminal prosecution (including prosecution of individual company officers), and indeed we have experienced instances where legal action of a criminal law nature was initiated personally against individual directors of companies that were presumed to be in default of their recapitulave statement filing requirements. We therefore strongly recommend taxpayers who may make intra-EU supplies of goods and / or services (even if on a one-off basis) to review their records in order to ensure that any and all recapitulative statement filing requirements have been fulfilled. Where there is any non-compliance in this respect, we would strongly recommend regularising the position within the concession period, i.e. to submit any pending recapitulative statements by no later 15 September 2023.

Intrastat

On a separate albeit similar note, the CfR had also issued a notice announcing enforcement of Intrastat filings. An Intrastat Arrival and/or Intrastat Dispatch declaration is required to be filed by all persons who buy or sell goods, when the said goods are transported between Malta and any other EU Member States. Failure to duly file any Intrastat declaration could also lead to criminal prosecution, and to penalties amounting between €700 and €3,500.

Should you wish to discuss the implications of this on your business in greater detail, or require our assistance with the review and regularisation of your VAT recapitulative statements filing position in order to take advantage of the one-time concession on penalties, or indeed to assist with any other VAT filings, please do not hesitate to contact us.