VAT ComplianceIn Business Outsourcing

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Value Added Tax is perhaps the most complex of indirect taxes, and with the ever-increasing legislative and technical burdens, it is becoming increasingly difficult for non-specialists to keep up with the requirements. This often ends up in the submission of partially incorrect returns and declarations, where businesses may end up facing hefty fines and unforeseen liabilities. At Nexia BT, we make sure that you can put your mind at rest with any necessary VAT compliance your business may require, diligently carried out by our team of VAT specialists.

Services include:

Persons carrying out an economic activity* are considered as taxable persons, and are required to register for VAT purposes under Article 10. In cases where the turnover will not exceed set thresholds, such taxable person may opt to register as a small undertaking under Article 11, where one is exempted from charging VAT on sales and is not able to recover input VAT.

* An economic activity means an activity carried on by a person, who is not an employee and consisting of any one or more of the following:

  • Any trade, business, profession or vocation and the provision of any personal services;
  • The exploitation of tangible or intangible property for the purpose of obtaining income therefrom on a continuing basis;
  • The provision by a club, association or organisation of the facilities or advantages available to its members for a subscription or other consideration;
  • The admission of persons to any premises for consideration.

The activities of a public authority assuming functions assigned to it by law shall not be deemed to be an economic activity except as and to the extent provided in the First Schedule of the VAT Act and except where such treatment as non-taxable persons would lead to significant distortions in competition.

Periodical VAT returns, normally every quarter, are submitted to the authorities to report any activity within the scope of VAT. Our team of professionals is trained to ensure that compliance reporting is accurate and complete.

Recapitulative declarations are periodical statements which a taxable person in Malta is required to submit where intra-Community supplies of goods are made to customers identified with a valid VAT Registration number in another Member State, where the customer is liable to pay the VAT on that good or service in the Member State of the establishment.

The frequency of reporting, being either monthly or quarterly, will depend on the volume of the type of trade.

Aimed at taxable persons supplying telecommunication services, television and radio broadcasting services and electronically supplied services, the Mini One Stop Shop became effective on 1 January 2015. In cases where such services are provided are to non-taxable persons in the Member States in which the supplier does not have an establishment, this scheme enables them to account for the VAT due on those supplies via a web-portal in the Member State in which they are identified. These MOSS returns are to be submitted on a quarterly basis, within twenty days from the end of each quarter.

This optional scheme is a simplification measure following the change to the VAT place of supply rules, in that the supply takes place in the Member State of the customer, and not the Member State of the supplier. It avoids taxable persons having to register in each Member State of consumption. The Mini One Stop Shop mirrors the scheme in place until 2015 for supplies of electronically supplied services to non-taxable persons by suppliers not established in the European Union.

The Mini One Stop Shop is divided into two sections, one for suppliers who are established in the EU and another for those who are only established outside of the EU.

Our team of trained professionals ensures that your business is provided with the insight and guidance necessary to make the correct assessment to avoid unforeseen VAT liabilities.

Taxable persons who incur VAT in connection with their activities in an EU country where they do not habitually supply goods or services, and are hence not required to register for VAT, are still entitled to recover such VAT, subject to the expenditure being eligible, by means of a refund from the EU country where they paid the VAT.

This EU VAT refund is administered electronically through the national VAT authority in which the taxable person is established. Although procedures are overall quite harmonised between the Member States, specific ineligibilities and conditions do exist. Our team of professionals is able to provide the necessary insight and guidance required to make sure that inaccurate or incomplete refunds claims are avoided.

Refund claims may be submitted once a year, within nine months from the end of a calendar year, or periodically if required.

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