Amnesty on corporate and income tax extended

The Ministry of Finance, the Economy and Investment has announced a new amnesty in relation to additional tax and interest charged, which is an extension of the first amnesty announced in September 2009.

OUTSTANDING CORPORATE AND INCOME TAX

The extended scheme applies to all taxpayers and applies to both the “old” assessment system (up to year of assessment 1998) as well as the “new” self assessment system (years of assessment 1999 to 2009). Taxpayers will be given the opportunity to reach an agreement on the old system only, the new system only or both.

Outstanding tax balances up to year of assessment 1998

In case of the old system, a taxpayer with pending tax balances will need to pay 75% of the amount due if payment is made in full by 31 October 2010.

Payment by Instalment

If the taxpayer chooses to pay on the basis of an instalment plan (IP) the amount that must be paid will be 80% of the amount due. 30% of the balance (i.e. 30% of the 80%) will have to be paid by 31 October 2010. The rest will be paid by instalments.

Outstanding tax balances from years of assessment 1999 to 2009

In case of the new system, taxpayers will benefit from an 85% reduction in additional tax and interests if they pay the remaining 15% of the penalties and the whole amount of tax due in full by 31 October 2010.

Payment by Instalment

If the taxpayer chooses to pay on the basis of an Instalment Plan, the reduction in additional taxes and interest will be 75%. 30% of the reduced total will have to be paid as a down payment by 31 October 2010. The remaining payments will be made over a number of months, as indicated by the Department.

To benefit from the scheme, taxpayers must satisfy all the following conditions:

• Submit all outstanding tax returns for the years of assessment 1999 to 2009 by 31 August 2010.
• Pay the amount of tax and (reduced) penalties by the date/s indicated in the agreement;
• Sign the agreement according to the option selected

OUTSTANDING AND FSS AND SSC PAYMENTS

As stated above, the scheme is being extended to employers who have pending FSS and SSC payments in respect of their employees for any year from 1998 to 2009.

Employers will benefit from a 90% reduction in penalties if they pay the remaining 10% of the penalties and the whole amount of FSS and SSC payments due in full by 31 October 2010.

Payment by Instalment

If an employer chooses to pay on the basis of an IP, the reduction in penalties will be 80%. 30% of the reduced total will have to be paid as a down payment by 31 October 2010.

To benefit from the scheme, employers must satisfy all the following conditions:

• Submit all outstanding FS3s and FS7s for the years 1998 to 2009 by 31 August 2010. Following the submission of these forms IRD will immediately process the relative documents and send a letter indicating the amount that needs to be settled;
• Pay the amounts and (reduced) penalties by the date/s indicated in the agreement;

For more information, kindly contact:

Christian Vella ‐ Director, Tax : This e-mail address is being protected from spambots. You need JavaScript enabled to view it