Businesses are facing financial hardship during this challenging period. They are seeing their revenues decline through decreased sales income, increase in expenses in order to introduce systems aimed at empowering their workforce to work remotely, bringing into action business continuity plans and other factors which are causing liquidity strain. For this purpose the government of Malta has announced a number of measures in order to temporarily assist with this burden.
The Maltese government through the Commissioner for Inland Revenue has communicated more details about the postponement of tax payments in view of the COVID-19 current reality on the 20th of March, 2020. The deferment will be applied on the following eligible taxes: Provisional tax, Employee taxes, maternity fund payments and social security contributions, social security contributions of self-employed persons and Value Added Tax. This will be applied for the taxes which fall due in March and April, 2020. These taxes will be then need to be paid in four monthly instalments in the period between May and August 2020. VAT dues are to be settled in two equal instalments with the two quarterly returns immediately following the quarter whose dues would have been deferred.
This deferral will not bring with it interest or penalties. The beneficiaries for this deferral are companies and self-employed persons that suffer a downturn in their turnover as a result of the current economic situation and are therefore facing cashflow difficulties. Companies and self-employed people who have failed to comply with their tax obligations in 2019 are not eligible for this deferral. The deferral will allow for a later payment of the taxes however it does not remove the obligation of beneficiaries from submission of documentation and returns by their normal due date as required by law.
