This scheme encourages undertakings including start-ups, family businesses and self-employed to invest in their business, so as to innovate, expand and develop their operations. Undertakings benefiting from this measure will be supported through a tax credit calculated as a percentage of eligible expenditure and wages costs.
Who Is eligible?
This incentive is open to all undertakings which satisfy the following criteria;
- The applicant must be an undertaking that for a consecutive three month period during the year in which the costs were incurred did not employ more than thirty persons on full time contracts
- The applicant must be an undertaking whose turnover did not exceed €10 Million in the fiscal year preceding the year in which the application is submitted.
- At the date of application, the applicant must employ at least one person on full or part time basis.
- Unless exempted, applicants should be duly registered with the VAT department.
- Persons or undertakings engaged in activities specifically excluded under the de minimis regulations are not eligible for this incentive.
What is the aid intensity?
Malta Enterprise will approve a tax credit equivalent to 45% of eligible expenditure. An additional bonus of 20% that is, a total of 65% tax credit applies to undertakings operating from Gozo.
- The maximum aid per undertaking.
As from 1st January 2018, the maximum eligible tax credits per single undertaking shall be capped at €50,000 over any period of 3 consecutive fiscal years, starting from eligible expenses incurred and paid for during the period from 1st January 2017 to 31st December 2017. This capping specified above shall be increased by €20,000 (to a total of €70,000) for undertakings:
- Operating from Gozo;
- Registered as a Family Business; and
- Having more than 50% of the ownership attributed to female persons.
In case of partnerships the eligible amount will be split according to ownership.
- Costs claimed must have been invoiced between 1st January and 31st December of the year preceding the year in which the claim is submitted.
- Costs claimed must not be assisted (even partly) through other incentive measures.
- Costs claimed must be covered by the appropriate fiscal documentation.
Costs incurred in relation to the following items will not be considered as qualifying;
- Purchase of land and/or property.
- Acquisition of works of art, antiques and any assets that are not directly related to the trade and business of applicant.
- Operating costs.
- VAT and other recoverable taxes.
- Vehicle accessories and upgrades unless purchased as an integral part of a commercial vehicle.
- Vehicles that because of their nature can also be used for non-business activities.
- Director’s fees.
- Maintenance costs.
- Subscription and other renewal fees.
- Any individual invoice having a value of less than €200.
- Costs of rented or leased equipment or property.
- Furbishing costs carried out in home-based offices unless a permit identifying the premises as a business premises is presented.
- Project Management fees.
- Transport costs unless included within an invoice covering the procurement of an eligible cost item.
- Promotional material.
- Intellectual Property.
- Web Hosting.