Tax rebate to pensioners

By means of LN 460 of 2020, the Government of Malta has amended The Tax Rebate (Pensioners) Rules.  These rules are applicable to individuals who are in receipt of income from any pension chargeable to tax under Article 4(1)(d) of the Income Tax Act, Chapter 123 of the Laws of Malta and who were at […]

Written By Stephen Balzan

On January 3, 2021
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By means of LN 460 of 2020, the Government of Malta has amended The Tax Rebate (Pensioners) Rules.  These rules are applicable to individuals who are in receipt of income from any pension chargeable to tax under Article 4(1)(d) of the Income Tax Act, Chapter 123 of the Laws of Malta and who were at least 61 years of age in the year when the said pension was received. 

In cases where the individual is chargeable to tax at the single rates of tax, a tax rebate shall be allowed as a set-off against the tax on the chargeable income by using the formula provided for in Rule 3 of S.L. 123.174. The maximum tax rebate that may be given in this case has been increased from €705 to €744. 

Individuals chargeable to tax at the parent rates of tax shall be given a tax rebate as a set-off against the tax on their chargeable income. The maximum tax rebate in this case has been increased from €495 to €534. 

Rule 3(3) of these Rules states that an individual who is chargeable to tax at the married rates shall be granted a tax rebate as a set-off against the tax on his chargeable income worked out using the formula provided in the Rules. The maximum rebate in this case has been increased from €165 to €204. Moreover, the additional maximum tax rebate provided for under Rule 3(3)(b) of the Rules has been increased from €300 to €540.

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].