Tax Guidelines Established on the Qualifying Employment in Aviation (Personal Tax) Rules ProgrammeMEDIA ROOM
On the 24th of May 2016, The Authority for Transport in Malta has been designated as the authority responsible for determining the eligibility or otherwise of an individual wishing to apply for the Qualifying Employment in Aviation (Personal Tax) Rules (the “Programme”).
Since the aviation sector is a significant player in the local economic development, the Programme has been introduced to attract EEA/Swiss nationals and third-country nationals, who hold an eligible office within the aviation industry, to Malta.
As outlined in a number of Government policy documents, Malta aims to develop into a fully-fledged aviation centre that supports the entire spectrum of aviation-related services, and the introduction of this Programme makes this widely possible.
The objective of the Programme is to give a long-term vision to the aviation sector in order to adequately prepare necessary operations with the skills required and control the limitations encountered due to the limited availability of human resources.
A successful applicant under this Programme will be able to benefit from a beneficial tax rate of 15%, subject to receiving an annual income of at least €45,000.
The guidelines for the Programme have now also been established and publicised.
One of the requirements of the Programme is that an individual will need to hold an eligible office in order to be able to apply for the tax incentive. The eligible offices have been established and are the following:
- Chief Executive Officer
- Chief Operations Officer
- Chief Financial Officer
- Chief Risk Officer
- Chief Financial Officer
- Chief Technology Officer
- Chief Commercial Officer
- Chief Investment Officer
- Chief Insurance Officer
- Accountable Manager
- Deputy Accountable Manager
- General Manager
- Flight Operations Manager
- Nominated Person Flight Operations Training Manager
- Nominated Person Training
- Ground Operations
- Nominated Person Ground Operations
- Continuing Airworthiness Manager
- Nominated Person Continuing Airworthiness Compliance Manager
- Quality Systems Manager
- Safety Manager
- Flight Dispatch Manager
- Instructor Manager
- Head of Marketing
- Head of Public Relations
- Underwriting Manager
- Risk Management Officer
- Key account manager
- Product coordinator
- Material coordinator
- Engineering reporter
- Aeronautical engineer
- Head of Maintenance Operations
- Aviation Systems Developer
- Key Aviation Specialist
If an individual, holding an eligible office within the aviation sector, is interested in benefitting from the fiscal incentives provided for by the Programme, the following conditions must be fulfilled:
- The applicant should be able to show that he is receiving a minimum of €45,000 in income per annum;
- The applicant’s contract of employment shall be subject to the laws of Malta;
- The applicant must be in possession of professional qualifications or relevant experience pertaining to his/her role;
- For tax implications, the applicant must be able to reveal and affirm that he has received emoluments in relation to income derived from a qualifying contract of employment and all income received from an individual related to his/her employer paying out income from a qualifying contract as chargeable to tax in Malta;
- The applicant must be able to prove that the occupation and the tasks performed fall within an eligible office title;
- The applicant shall prove that he receives stable and regular income. This income shall be considered to be enough to sustain himself and his family members;
- The applicant shall prove that he is residing in standard accommodation which is akin to accommodation typically occupied by Maltese families;
- The applicant must be in possession of a valid travel document;
- The applicant must be in possession of sickness insurance for himself and his family members; and
- The applicant must not be domiciled in Malta; and
- The individual shall only be eligible to benefit from the 15% tax rate if the applicant does not control more than 25% of the shares within the employment undertaking.
The favourable tax incentives are available to EEA and Swiss Nationals for a maximum period of five (5) consecutive years, while the tax incentives are available for third-country nationals for a maximum period of four (4) consecutive years.
The four (4) or five (5) year period, as the case may be, commence from the year when the individual concerned first became taxable in Malta, even though such individual was not yet benefitting from the Programme.