On 25 August 2020, Malta has issued Legal Notice No. 345, which clarifies Regulations on research and development (R&D) tax credits for corporate income and individual income tax in response to the COVID-19 pandemic. The Legal Notice includes the following measures:

  • An undertaking benefiting from tax credits in terms of these regulations and the respective Guidelines shall be entitled to deduct from the amount of income tax which is due on its chargeable income derived from its trade or business in the years of assessment following the award of the benefit an amount equivalent to the tax credit awarded;
  • An undertaking that in any year of assessment does not utilize any tax credit awarded or deducts a value from the amount of income tax which is due on its chargeable income derived from its trade or business that is less than the tax credit awarded shall carryforward the unutilized tax credit for the following years of assessment and so on for subsequent years; and
  • Tax credits awarded in terms of these regulations and the respective Guidelines shall not give rise to a right to a refund of tax.

Applications for assistance to support eligible undertakings under these regulations shall reach the Corporation by not later than 31 December 2020.