Innovation Aid for SME’s

Introduction Malta Enterprise (ME) has recently launched a new scheme, the scope of which is to assist SMEs that qualify for this incentive to recover in the form of tax credits, part of the costs incurred for the secondment of highly qualified personnel from large undertakings or Research and Knowledge-dissemination Organisations. Secondment means the temporary […]

Written By Stephen Balzan

On September 7, 2017
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Introduction

Malta Enterprise (ME) has recently launched a new scheme, the scope of which is to assist SMEs that qualify for this incentive to recover in the form of tax credits, part of the costs incurred for the secondment of highly qualified personnel from large undertakings or Research and Knowledge-dissemination Organisations.

Secondment means the temporary employment of staff by a beneficiary with the right for the staff to return to the previous employer.

The aid shall be granted in the form of tax credits and shall be capped at 50% of the eligible costs.

Eligible costs

Costs incurred from a research and knowledge-dissemination organization or a large undertaking for secondment of highly qualified personnel employed are eligible for this incentive.  The secondment of the highly qualified personnel must be covered by an agreement between the applicant and the research and knowledge-dissemination organization or the large enterprise specifying the research, development and innovation activities which will be carried out by the personnel for the SME.

Highly qualified personnel shall mean staff having a tertiary education degree and having at least five (5) years of relevant professional experience which may also include doctoral training.

The seconded personnel must be engaged in a newly created function within the SME and must not be replacing other personnel.    The loan agreement must commence prior to 31st December 2020 and must not be extendable beyond a period of 24 months.

 All costs must be incurred following the submission of an application for support.

Eligibility

This incentive is open to all undertakings which are not excluded by State Aid Regulations and which are planning to carry out or implement Experimental Development activities. 

Applicants must not be defaulting on VAT, Income Tax, and Social Security Contributions.  The Inland Revenue Department may suspend any tax credit awarded if the beneficiary is defaulting on VAT, Income Tax, and Social Security payments.

How can we help?  

For further information, please contact one of the firm’s tax partners, Stephen Balzan on [email protected] or Elaine Camilleri [email protected]. ACT can help you understand the changes to the tax rules and how these can impact your business.  

Apart from its offices in St. Julian’s Malta, ACT operates from a second office in Gozo, which is situated in the capital city of Victoria.  For an appointment in our Gozo office, please call on 00356 21378672 or send us an email on [email protected]. 

Disclaimer: This article contains general information only and is not intended to address the circumstances of any particular individual or entity. ACT, by means of this article is not rendering any accounting, business, financial, investment, legal, tax, or other professional advice or service. This article is not a substitute for such professional advice, nor should it be used as a basis for any decision or action that may affect your finances or your business. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. Before making any decisions or before taking any action that may affect your finances or your business, you should consult a qualified professional adviser. ACT shall not be responsible for any loss whatsoever sustained by any person who relies on this article.