The 30th of June is fast approaching and this is the last day for filing of one’s own income tax return in respect of year of assessment 2019. It is also the deadline for one to declare any income from part time self-employment as well as rental income and benefit from a reduced rate of tax of 15%.
Filing of income tax return
With effect from the year 2018, persons who are ordinarily resident but not domiciled in Malta and who are taxed in Malta on a remittance basis are required to pay an annual minimum tax liability of Eur5,000 if their foreign income exceeds Eur35,000 which is not fully remitted to Malta. The Eur5,000 minimum tax liability is gross of relief from double taxation which one may be entitled to and includes any Maltese tax withheld at source but does not include any tax payable in Malta on transfers of immovable property situated in Malta. In the case of a married couple, the Eur35,000 threshold is to be calculated by reference to the total income of the couple and the Eur5,000 minimum tax is applicable to the couple. One may opt to be taxed on a worldwide basis, instead of the remittance basis, if one’s tax liability on the worldwide income is less than the minimum annual tax of Eur5,000.
Income from part time self-employment
Individuals who carry out a trade or business, profession or vocation on a part-time basis can benefit from a reduced rate of tax of 15%. This would mean that such individuals would not be required to report such income in their personal income tax return. The deadline for the submission has been extended to 30th June from the 30th April and payment of the due tax has to be made together with the submission of the relevant form. Certain conditions apply for one to be able to benefit from the reduced rate of tax on part-time self-employment income.
The deadline for the reporting of one’s rental income derived from commercial and residential property has also been extended to the 30th June from the 30th April. Owners of immovable property renting their properties and deriving rental income therefrom can benefit from a reduced rate of tax of 15% on their gross rental income and thus will not be required to report their income in their personal income tax return. Payment of tax has to be made together with the submission of the relevant form.