| 8/2/2012 |
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| Board of Special Commissioners - Cases |
| Case No. 3/63 |
Decided: 27 March, 1963 |
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Tax residence of an interdicted person living abroad; whether expenses incurred in a curatorship are "in the production of the income" - article 22, since repealed, and 10, now 14, Income Tax Act
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Taxpayer's curator appealed against the Commissioner's decision to treat the taxpayer as a non-resident, refusing to allow personal deductions as well as the deduction for expenses incurred in the curatorship.
The Board decided that the taxpayer could not be considered to be resident in Malta for tax purposes in the light of the lengthy period he had been residing overseas. The Income Tax Act defined "resident in Malta" as "an individual who resides in the Island except for such temporary absences ..." which was not the case. The curator, however, argued that Civil Law vested the residence of interdicted persons in their curators. The Board ruled that residence for tax purposes was a question of fact and not a legal concept. Moreover, the provisions of the Civil Code that regarded the residence of interdicted persons dealt with completely different judicial considerations.
Regarding the expenses incurred by the curator, the Board agreed with the Commissioner that they were not incurred wholly in the production of taxpayer's income. The duties of the curator were not limited to the receipt of income and payment of expenses but, rather, the application of the interdicted person's income in terms of law and as directed by the Courts. His fees, moreover, were incurred by the taxpayer because of his personal status. They were, therefore, personal in nature and not deductible.
An appeal was entered before the Court from this decision (see case no. 53).
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