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Our experienced indirect tax team can assist you with any advice required in relation to VAT procedures & VAT treatment of particular economic transactions.
VAT Advice & Assistance
The team can assist you through the VAT registration process, guiding you through the different types of VAT registrations possible, and ensuring the VAT number is obtained within the shortest possible timeframe.
CSB Group can also assist you with the compilation and submission of the necessary VAT related documents, ensuring that periodic VAT returns and other required submissions are duly completed and filed appropriately with the relevant authorities in a timely manner. CSB Group can also represent the company with the VAT authorities who can, at their discretion, request meetings with the company directors to obtain further information about the company’s activities. In the case of a VAT inspection, we can also assist our clients by liaising with the VAT authorities and providing the appropriate records as necessary.
VAT Registrations
Value Added Tax (VAT) in Malta is governed by the VAT Act (Cap. 406) and supporting subsidiary legislation. Every person carrying out an economic activity in Malta must assess whether there is an obligation or option to register for VAT — with registration determining the chargeability, recoverability, and reporting obligations.
When VAT Registration Is Required
VAT registration in Malta is generally required when a person carries out a taxable economic activity in Malta, unless a specific exemption or special scheme applies. Failure to register in time can lead to assessments, interest, and administrative penalties, so the registration position should be considered from the start of trading activity and monitored on an ongoing basis.
Types of VAT Registrations
Article 10 Registration
Article 10 registration applies to taxable persons making supplies of goods or services in Malta that are not exempt without credit and who are not registered as small undertakings. It is also available on an optional basis for persons intending to carry out a taxable economic activity below the domestic threshold.
Article 10 is typically the default registration for businesses with turnover above the domestic thresholds of €35,000 per annum or those engaged in intra‑Community supplies or acquisitions on a regular basis.
Under Article 10 registration:
- VAT must be charged on taxable supplies.
- The taxable person may reclaim input VAT.
- Quarterly VAT returns are required.
Article 11 Registration
Article 11 provides an exemption scheme for small undertakings whose turnover does not exceed the domestic threshold and which meet the conditions laid out in the Sixth Schedule of the VAT Act. It is usually intended for businesses with local supplies only and relatively low annual turnover.
If turnover exceeds the domestic threshold, the person must notify the Commissioner and move to Article 10 registration within 15 days from the point it becomes evident that the threshold will be exceeded.
Under Article 11:
- No VAT is charged on supplies.
- VAT on purchases cannot be recovered.
- An annual VAT declaration is filed.
Article 11A and Article 11B Registrations
Article 11A implements a special regime for small enterprises engaged in EU cross‑border trade. This simplifies obligations for small Maltese businesses that would otherwise be required to register in multiple Member States due to cross‑border B2C supplies. Apart from the domestic threshold, small enterprises registering under Article 11A must not exceed the Union turnover threshold of €100,000 per annum. Periodic (typically quarterly) VAT declarations are required.
Article 11B applies to small undertakings established in other EU Member States that wish to benefit from the exemption for small enterprises for supplies made in Malta. A taxable person established outside Malta is deemed registered under Article 11B once the Commissioner is notified by the respective Member State of establishment.
Article 12 Registration
Article 12 applies where a person not registered for VAT (which does not carry on an economic activity) or a taxable person not registered under Article 10 makes intra‑community acquisitions of goods exceeding €10,000 in value over a calendar year. Such persons must register under Article 12 and pay VAT on these acquisitions.
Under Article 12:
- Notices of Payment of VAT must be submitted when services are received or when intra‑community acquisitions occur.
- An annual declaration is required.
Registration Thresholds (Small Undertakings)
| Type of Economic Activity | Domestic Annual Turnover Threshold Entry |
|---|---|
| Economic activity principally in the supply of goods | €35,000 |
| Economic activities principally in the supply of services (relatively low value added) | €35,000 |
| Other economic activities | €35,000 |
These thresholds are used to determine whether a person may elect Article 11 exemption or must register under Article 10.
Note: Thresholds relate to domestic supplies within Malta and may be subject to updated guidelines; cross‑border turnover rules apply under Articles 11A/11B.
VAT Compliance Procedures
VAT Returns – Article 10 Registrations
Taxpayers registered under Article 10 must submit periodic VAT Returns within 6 weeks following the end of each VAT quarter.
Failure to submit a return by the deadline will result in a monthly administrative penalty equal to the higher of:
- €20; and
- 1% of the VAT amount due as recorded in the VAT return.
Where VAT payable is less than €250, this penalty is capped at the amount of the tax payable or €50 per VAT return, whichever is greater.
If input VAT exceeds output VAT for a quarter, the excess will be refunded. If output VAT exceeds input VAT, the balance must be paid by the due date, with interest payable on late payments.
VAT Declarations (Article 11 & 12)
VAT Declarations for Article 11 and Article 12 registrations are typically submitted by:
- 15th March (Article 11) after the end of the calendar year;
- 15th February (Article 12) after the end of the calendar year.
Failure to submit by the deadline results in a monthly administrative penalty of €10, capped at €120 per declaration.
Notices of Payment of VAT (Article 12 Registrations)
VAT FORM 004/2010 and associated payment must be furnished to the Office of the Malta Tax and Customs Administration by no later than the 15th day of the second month following either the date of invoice or the month during which the service is received, whichever is earlier.
VAT Recapitulative Statements
Taxable persons registered under Article 10 who supply goods or services to EU taxable persons with valid VAT numbers may be required to submit periodic recapitulative statements summarising intra‑community sales (to VIES). These are due by the 15th day of the month following the reporting period.
VAT FORM 004 / 2010 – The form together with payment shall be furnished to the Office of the Commissioner for Revenue by not later than the 15th day of the second month next following either the date of the invoice or of the month during which the service is received whichever is the earlier. .
One Stop Shop (OSS) & Import One Stop Shop (IOSS)
The One Stop Shop (OSS) is an EU‑wide simplification for taxable persons making cross‑border B2C supplies of goods or electronically‑supplied services within the EU. It allows reporting and payment of VAT for multiple Member States through a single quarterly electronic portal. OSS in Malta is administered by the Malta Tax and Customs Administration, and returns are typically filed quarterly. VAT must be accounted for at the rate applicable where the customer is located.
There are three main OSS schemes:
- Union OSS – for EU‑established suppliers of goods and services to EU consumers;
- Non‑Union OSS – for suppliers outside the EU selling B2C services into the EU;
- Import OSS (IOSS) – for distance sales of imported goods under €150.
VAT Rates in Malta
VAT Rate Example
| VAT rate | Examples |
|---|---|
| 18% | Standard rate on most goods and services |
| 12% | Certain services (e.g., management of credit, yacht charter) |
| 7% | Licensed accommodation, use of sporting facilities |
| 5% | Electricity supply, confectionery, printed matter |
| 0% | Zero rated items such as basic food, medicines, exports |
Reduced and zero rates apply only where explicitly defined under Maltese VAT law.
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