The on-line Income Tax Return Calculator
The
main objective of this application is to enable a web user to calculate the tax
due while filling out the income tax return.
When completing the on-line Income Tax
Return it is recommended that you use the booklet that was supplied to you when
you received the actual Income Tax Return from the Inland Revenue Department.
Currently the marital status is
defaulted to Single, but can be modified by choosing the required status from
those shown in the drop down list. If
‘Married’ is selected you may enter information related to the income earned by
your spouse.
The source of income can be selected by
ticking the box next to one or more of the following options:
|
Employment |
Tick if you (or your spouse) earn income from
employment |
|
Trade
or Business |
Tick if you earn income from a trade,
business, profession or vocation activity |
|
Pension |
Tick if you earn income from a
pension (whether local or overseas) |
|
Other
Income |
Tick if you earn income from
dividends, interests, capital gains, rents etc |
The number of pages that will be
displayed (and filled in) depends on the sources of income selected and
therefore it is recommended that the correct sources of income are selected
beforehand. This will make sure that
only the required pages are displayed making it easier to fill in the Tax
Return.
For instance, if ‘Other Income’ only is
selected as a source of income, only the items related to ‘Other income’ will
be displayed for the calculation.
When the ‘Start’ button is clicked and
the relevant income details will be displayed. Each of these is explained in more detail below.
Emolument and Business Income Section
In this section you must
include the gross income received during the year in question from employment
or office. This should include:
·
Salary
and wages
·
Statutory
bonus and other bonuses
·
Overtime
payments
·
Fringe
Benefits
·
Other
payments and allowances, including any commissions
For each separate source of
income from employment or office enter the PE number of the payer in the
‘Detail’ field. Include the gross emolument amount shown on the FS3 provided by
your payer in the ‘Amount’ field.
Employment Income earned by yourself will be entered under the ‘Self’ column, whilst that of your spouse (if any) will be entered under the ‘Spouse’ column.
In the fields provided you
must declare the net profit for the basis year from all trade, business,
profession and vocation activities.
For each source of trade,
business, profession or vocation you must provide the VAT number in the Detail
field and the net profit earned in the Amount field.
In the case of a loss
indicate the amount accompanied with a negative sign in front of the amount
Trade & Business Income
earned by yourself is to be entered under the ‘Self’ column whilst that of your
spouse (if any) is to be entered under the ‘Spouse’ column.
Include the PE number or
other reference number of the pension provider in the Detail field and the
gross income received from each local and overseas pension in the Amount field.
Pension income received from
the Department of Social Security should be entered here for yourself and your
spouse (if any) in the ‘Self’ and ‘Spouse’ columns respectively. Remember that the PE Number of the
Department of Social Security is 732913 (to be entered in the ‘Detail’ field).
Any pension received from
the Treasury Department by yourself and your spouse (if any) should be declared
in the Treasury Pension fields under the ‘Self’ and ‘Spouse’ columns
respectively. The PE Number of the
Treasury Department is 952449 (to be entered in the ‘Detail’ field).
Enter the amount of pension
derived from a local source in the ‘Other Local Pension’ field. Remember to enter amounts received by
yourself under the ‘Self’ column and that received by your spouse (if any)
under the ‘Spouse’ Column.
Enter the amount of pension
derived from an overseas payer in the ‘Other Overseas Pension’ field.
Social Security Benefits,
e.g. Unemployment Benefit or Sickness Benefit are taxable and are to be
included here.
Allowable deductions (if
any) against emoluments to be deducted are to be inserted in the Allowable
deductions field.
If the tax status selected
is married you must declare any allowable deductions for the responsible spouse
in the ‘Self’ column and allowable deductions (if any) for the other spouse in
the ‘Spouse’ column
The Business Promotion Act
allows for certain deductions or exemptions for income tax purposes to eligible
individuals, mainly individual members of a partnership. Individuals who may be eligible under the
said Act to apply for such deductions or exemptions should enter the amount
claimed in the space provided.
Investment, Capital Gains and Other Income
Local dividends need not be
declared unless a credit for tax deducted at source is being claimed.
Enter the total gross amount
of local dividends in the relevant field.
All local interest income
that did not suffer tax deductions at source must be included in the “Local
Interest’ field.
Interest income from local
banks which has already suffered 15% Tax need not be declared in your tax
return. If however, you are a low income earner it might be to your advantage
to deduct the tax withheld at source from local interest in which case you will
need to declare the gross interest amount in the ‘Local Interest’ field. This applies only for interests earned up
to 31/12/2001
Non-residents should note
that their local interest income is exempt from income tax in Malta.
If you are domiciled and
ordinarily resident in Malta you must declare all foreign dividends and foreign
interest income. All other taxpayers (i.e. not domiciled or not ordinarily resident
in Malta) are required to declare only foreign dividends and foreign interests
which were remitted to Malta.
Include in the ‘Foreign
Dividends’ field the total amount of gross foreign dividends (in Maltese Liri).
Include in the ‘Foreign
Interest’ field the total amount of gross foreign interest (in Maltese Liri).
Please note that foreign
currency accounts held locally are not to be included in this field but in the
‘Local Interest’ field.
In this field include any
gross rents, premiums, key money, laudemia and any other such gross receipts
arising from property
The total income from ground
rents received should be entered in the ‘Income from ground rent’ field.
In this field you must
include the net amount of taxable capital gains derived during the basis year.
Taxable capital gains arise
from the transfer of the ownership or usufruct of or from the assignment or concession
of any rights over, any immovable property, securities, business goodwill,
copyright, patents, trademarks and trade names.
Where in a particular year a
capital loss results, this amount may not be set off against other income. It
can be set off only against future capital gains. You are to keep a note of any
such capital loss which may have resulted in order to claim it against future
capital gains (if any) in a subsequent year.
Capital gains realized on transfers of immovable property obtained through an inheritance are exempt from tax.
If you received any income
from your spouse as alimony payment in respect of yourself and/or your
children, such income is taxable and should be included in the space provided.
In this field you must
include any other income to be declared which has not been included elsewhere
in your tax calculator.
Examples of ‘Other Income’
include:
·
Casual
receipts (e.g. from electoral duties, invigilation, examiner’s fees, radio and
TV participation etc.)
·
Royalties
Deductions
Ground paid on property for which rental
income has been received may be entered here.
The 20% further deduction is allowable irrespective
of whether actual expenditure has been incurred. It amounts to one fifth of the rents received i.e. 1/5 of Gross
Rents less ground rents. Note that this
deduction is not allowable against ground rents received.
Any Interests incurred on
borrowed capital for aquiring income is deducted here. No deduction is allowed in respect of
interest payable which is of a personal or private nature.
In this field you may enter
the amount of alimony paid to your estranged spouse, so that it can be deducted
from the chargeable income. A Maltese court should have established the alimony
payment.
Please note that alimony paid in respect of dependent
children is not an allowable deduction.
Parents [or legal guardians] whose child or children have attended a private, fee-paying independent school during 2001 and after are eligible for a deduction equal to
1.
The
lower of Lm200 or the amount of school fees paid during 2001 and after for every child
attending an independent school at a primary level;
2.
The
lower of Lm300 or the amount of school fees paid during 2001 and after for every child
attending an independent school at a secondary level;
In this field you may enter
the amount of any other allowable expense in respect of income, which has been
declared, (for example trading losses incurred in prior years and which may be
set-off against this year’s chargeable income)
If you make any deductions
which are not according to the law as well as any deductions to which you are
not entitled, you will be liable to penalties (additional tax) according to the
Income Tax Acts. The additional
tax for the first omission is 3% per month on the tax evaded. For a second
omission the additional tax is 4%, for a third omission 5%, for a fourth or
further omission the additional tax is 6%.
Tax Credits
In this field you should
enter any FSS tax withheld during the basis year from employment income or
local pensions. This amount can be found on the FS3 given to you by your
employer or pension provider.
For each separate amount of
FSS tax deduction enter the PE number of your employer or pension provider and
the amount of tax deductions made during the basis year.
If in this step, you are
deducting the credit for tax which was deducted from your part-time employment
income at the special 15% rate you must also include the part-time income in
the ‘Employment or Office’ fields.
If the tax status selected
is married you must enter the amount of tax withheld of the responsible spouse
in the ‘Self’ column and the amount of tax withheld (if any) for the other
spouse in the ‘Spouse column.
Enter the total of all
provisional tax payments made for the basis year. These payments are printed on page 4 of the Income Tax Return
In this field you must enter
the total amount of all payments made for any transfer of property.
Please
note that such amount may be deducted provided that a capital gain income has
been declared.
In this field you should
only include tax deductions that were made (usually at 35%) from the local
dividend income declared
In this field you may deduct
any other amounts which qualify for tax credits such as
The Restart button is used to reset all
values, while the ‘Back to Return’ button is used to go back to the Interactive
Tax return without losing any inputted data.
Once all data has been successfully
inputted, click on the Process icon, where the Tax Computation screen will be
displayed displaying the tax calculations as per inputted values.
This section determines your chargeable
income as well and computes the amount of tax due of that income.