Register for VAT in Malta

Why Register for VAT in Malta?

Registering for Value Added Tax (VAT) in Malta is a legal requirement for businesses exceeding the turnover threshold or engaging in taxable activities. VAT registration enables businesses to charge VAT on sales and reclaim VAT on eligible expenses.

Who Should Register in Malta?

  • Mandatory Registration:
    • Businesses supplying goods/services in Malta with taxable turnover exceeding €35,000 (goods) or €24,000 (services) in a calendar year.
    • Businesses engaged in intra-EU transactions (e.g., acquiring goods from EU suppliers).
    • Distance sellers (e.g., e-commerce businesses selling to Maltese customers exceeding €35,000 annually).
    • Non-resident businesses providing taxable supplies in Malta (unless covered by the “Mini One Stop Shop” (MOSS) scheme).
  • Voluntary Registration: Businesses below the threshold can register voluntarily to reclaim input VAT.

How to VAT registration Process?

Gather necessary documents, including the Business details (name, address, trade license), financial projections or past turnover (if applicable), Articles of Incorporation (for companies), and Bank account details.

Await approval:

    • The Commissioner for Tax and Customs reviews applications (typically 2–4 weeks).
    • Successful applicants receive a VAT number (MTxxxxxx format).

How to VAT filing process in Malta?

The Value Added Tax (VAT) filing process varies depending on the type of VAT registration your business holds. The Commissioner for Revenue provides an online portal for submitting VAT returns and related documents. Access requires an e-ID, which can be obtained by following the guidelines provided on the official website. Once logged in, users can complete and submit their VAT returns electronically.

VAT returns (VAT 3 Form)

  • Filing frequency:
    • Quarterly: For businesses with annual turnover < €1.2 million.
    • Monthly: For businesses exceeding €1.2 million or those with irregular refund positions.
  • Deadlines:
    • Quarterly returns: 6 weeks after the quarter ends (e.g., Q1 ends March 31 → file by May 15).
    • Monthly returns: 1 month after the month ends.

Annual VAT declaration (VAT 10)

  • A summary report filed by March 31 of the following year (if applicable).

How to pay VAT payment?

Payments can be made through the Government Payment Gateway (gPG) or via internet banking. When using internet banking, ensure you quote the unique payment reference number provided after submitting your VAT return.

  • Electronic payments (preferred), bank transfers, or cheques payable to “Commissioner for Revenue.”

Penalties for non-compliance

Failure to submit VAT returns on time results in a monthly administrative penalty equal to the higher of €20 or 1% of the VAT amount due. Late payments incur a fine of 0.06% interest per month.

  • Late filing: €50–100 per month.
  • Late payment: 0.75% monthly interest on unpaid amounts.
  • Incorrect returns: Fines up to double the tax evaded. 

How to VAT deregistration in Malta?

Deregistering from Value Added Tax (VAT) in Malta is a structured process that requires adherence to specific guidelines. Below is a step-by-step guide to assist you:

When to deregister:

  • Mandatory:
    • Business ceases taxable activities.
    • Annual turnover falls below thresholds for2 consecutive years.
    • Insolvency or liquidation.
  • Voluntary: Business no longer meets registration criteria (requires approval).

Deregistration process:

  1. Submit request:
    • File a deregistration application via the Tax and Customs Portal.
    • Include the reason for deregistration (e.g., cessation of trade).
  2. Final VAT return:
    • Submit a final VAT 3 return covering the period up to the deregistration date.
    • Settle any outstanding VAT liabilities.
  3. Confirmation:
    • The Commissioner issues a deregistration certificate.
    • The VAT number becomes invalid immediately.

Post-Deregistration Obligations

  • Retain VAT records for 6 years.
  • File pending returns or declarations (if applicable).

 Key Considerations

  • Reverse Charge Mechanism: Applies to cross-border services (VAT reported by the buyer, not the seller).
  • EU Transactions: Use the EC Sales List (ESL) to report intra-EU B2B sales.
  • Invoicing Rules: VAT invoices must include your VAT number, customer details, and VAT rate applied (standard rate: 18%, reduced rates: 5%, 7%, or 0%).