By means of Legal Notice 8 of 2024, the Government of Malta has issued the above-mentioned rules in relation to income derived by individuals from a full or part time artistic activity in terms of Article 56(26A) of the Income Tax Act.
In terms of the said Article, an individual who derives income from a full-time or part-time artistic activity shall, unless he opts to have the said income charged to tax at the standard progressive rates of tax applicable to resident individuals rates, will be charged to tax on all such income at the rate of 7.5% of the gross amount of the income so derived. The tax chargeable shall be final and no set-off or refund shall be granted. Income shall be deemed to have been income derived from an artistic activity if it has been so certified by the Arts Council Malta established by the Arts Council Malta Act.
The above is applicable to income derived on or after 1st January 2022 from a trade, business or vocation, chargeable to tax in terms of Article 4(1)(a) of the Income Tax Act. The tax so charged will be charged on the gross receipts before any deductions and shall be applied to an amount not exceeding Eur30,000 in respect of year of assessment 2023 and to an amount not exceeding Eur50,000 for any other subsequent years of assessment. Tax is due by not later than the 30th April of the relative year of assessment.
Where the gross receipts derived by an individual from an artistic activity exceed Eur30,000 in respect of year of assessment 2023 and Eur50,000 in respect of any subsequent years of assessment, the said individual shall report such excess in his personal income tax return and be charged to tax at the applicable rates of tax. Deductions for allowable expenses may be deducted against such excess, but such deductions shall not exceed the amount of the said excess. It is not possible for the individual to be taxed at the rate of 15% on such excess in terms of the part-time rules.
Any individual who derives income from an artistic activity and who does not report such income as provided for in these rules, will be deemed to have opted to be taxed at the standard progressive rates of tax and must report such income in his or her personal income tax return.
The Arts Council Malta may require such information and evidence and may adopt such criteria and guidelines as it may, in its discretion, consider appropriate.
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