Malta’s Ministry of Finance, the Economy and Investment has announced phase two of a scheme to aid taxpayers with outstanding tax debts to regularize their position without incurring the full amount of additional tax and interest.
Phase two expands the scheme by offering alternative methods of payment, extending payment periods and including other types of tax such as social security payments.
The second phase of the amnesty scheme applies to all taxpayers (both companies and individuals) and includes unpaid tax under the 'old' assessment system up to the year 1998 and the new self-assessment system introduced from 1999 onwards.
In the case of the old system, a taxpayer with pending tax balances who opts to use the scheme will need to pay 75% of the amount due if payment is made in full by October 31, 2010. If the taxpayer chooses to pay on the basis of an installment plan, the amount that must be paid will be 80% of the amount due. 30% of the balance (i.e. 30% of the 80%) will have to be paid by October 31, 2010. The remainder would then be paid in installments, the ministry said.
In the case of the new system (years of assessment 1999-2009), taxpayers opting to use the scheme will benefit from an 85% reduction in additional tax and interest if they pay the remaining 15% of the penalties and the whole amount of tax due in full by October 31, 2010. Thus, a taxpayer who owes EUR1,200 (made up of EUR800 pure tax, EUR300 additional tax and EUR100 interest) will need to pay EUR800 + EUR45 + EUR15 by October 31, 2010, i.e. EUR860 instead of EUR1,200. If the taxpayer chooses to pay in installments, the reduction in additional taxes and interest will be 75%. 30% of the reduced total will have to be paid as a down payment by October 31, 2010. The remaining payments will be made over a number of months, as indicated by the Department.
Phase two also extends the scheme to employers who have pending employment tax payments for any year from 1998 to 2009. Employers will benefit from a 90% reduction in penalties if they pay the remaining 10% of the penalties and the whole amount of unpaid tax due in full by October 31, 2010.
Phase two expands the scheme by offering alternative methods of payment, extending payment periods and including other types of tax such as social security payments.
The second phase of the amnesty scheme applies to all taxpayers (both companies and individuals) and includes unpaid tax under the 'old' assessment system up to the year 1998 and the new self-assessment system introduced from 1999 onwards.
In the case of the old system, a taxpayer with pending tax balances who opts to use the scheme will need to pay 75% of the amount due if payment is made in full by October 31, 2010. If the taxpayer chooses to pay on the basis of an installment plan, the amount that must be paid will be 80% of the amount due. 30% of the balance (i.e. 30% of the 80%) will have to be paid by October 31, 2010. The remainder would then be paid in installments, the ministry said.
In the case of the new system (years of assessment 1999-2009), taxpayers opting to use the scheme will benefit from an 85% reduction in additional tax and interest if they pay the remaining 15% of the penalties and the whole amount of tax due in full by October 31, 2010. Thus, a taxpayer who owes EUR1,200 (made up of EUR800 pure tax, EUR300 additional tax and EUR100 interest) will need to pay EUR800 + EUR45 + EUR15 by October 31, 2010, i.e. EUR860 instead of EUR1,200. If the taxpayer chooses to pay in installments, the reduction in additional taxes and interest will be 75%. 30% of the reduced total will have to be paid as a down payment by October 31, 2010. The remaining payments will be made over a number of months, as indicated by the Department.
Phase two also extends the scheme to employers who have pending employment tax payments for any year from 1998 to 2009. Employers will benefit from a 90% reduction in penalties if they pay the remaining 10% of the penalties and the whole amount of unpaid tax due in full by October 31, 2010.
