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Personal tax deadlines – 30 April 2021

Deloitte Malta Tax Alert

12 April 2021

As the 30 April deadline for a number of Malta personal income tax compliance obligations draws near, we are setting out below the salient obligations on taxpayers under the various schemes.

Income from Part-Time Self-Employment

Individuals earning income from part-time self-employment may benefit from a flat rate of tax of 15% on the first €12,000 arising from their part-time self-employment activities.

In order to benefit from this tax treatment, the individual, besides conducting self-employment activities, must also be in full time employment or is a pensioner or a full time student/apprentice. The part-time employment must be registered as such with JobsPlus. It must also be VAT registered, where required. The activity must not have more than two employees, themselves also on a part-time basis.

Tax is calculated on the profit rather than on turnover (i.e. revenue less expenses that were wholly and exclusively incurred in the production of the income).

With respect to the year of assessment 2021 (with reference to part-time activities carried on during 2020) individuals opting for this tax treatment are required to prepare and submit the appropriate TA22 form to the Malta Inland Revenue, together with the tax payment, by no later than the 30 April 2021.

Rental income

Taxpayers earning rental income in the course of 2020 and who opt to be taxed at a flat rate of 15%, must file the appropriate TA24 form and submit payment by 30 April 2021.

Tax is calculated on the gross amount received, without the possibility to claim any deductions. Furthermore, as previously set out in our tax alert on Private Residential Leases, persons who derived rental income from a long private residential lease of at least two years duly registered as such, are eligible for a tax rebate. This rebate may be claimed through the aforementioned TA24 form.

The option to be taxed at a flat rate of 15% may be availed of both in case of commercial and residential rents, and is open to both individual and corporate taxpayers, whether resident in Malta or not.

Provisional Tax and Social Security Contributions

The deadline for the submission of the first provisional tax payment by self-employed individuals and Class 2 Social Security Contributions with respect to 2021, also fall on the 30 April 2021. Payments are to be made to the Commissioner for Revenue.

The first provisional tax payment should amount to 20% of the provisional tax benchmark, which would be typically established on the tax charge with respect to basis year 2019.

Meanwhile, class 2 social security contributions falling due on 30 April 2021, calculated on the basis of net income for the preceding taxable year i.e. 2020, are calculated on the number of Mondays from January to April 2021.

Certain individuals may be eligible for the tax deferral scheme announced as part of the COVID-19 financial measures, on provisional tax and social security
contributions.  

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