The Micro Invest Scheme has been re-launched to encourage undertakings to invest in their business, to innovate, expand, and implement compliance directives or to develop their operations. Such undertakings may include self-employed persons. Undertakings will be supported through a tax credit representing a percentage of the eligible expenditure and wages of newly recruited employees and/or apprentices.
This incentive covers eligible costs incurred between 1st January 2013 and 31st December 2013, both dates included. Applications for assistance under this incentive will be received until the 28th March 2014.
This incentive is available to all undertakings, which at the point of application satisfy all of the following criteria:
a. In the case of autonomous undertakings, the undertaking must not employ more than 30 persons (full time equivalent) as at 30th November 2012 and the annual turnover of the undertaking for 2012 must not exceed €10 Million;
b. In the case of undertakings forming part of a group, as defined by the guidelines, the group must not employ more than 30 persons (full time equivalent) as at 30th November 2012 and the annual turnover of the group for 2012 must not exceed €10 Million;
c. The undertaking must employ at least 1 person. Start-up undertakings set up after this date and employing at least 1 person between the setting-up date and the 31st of December 2013 are deemed as eligible;
d. Undertakings should be registered with the VAT department;
e. Undertakings should be in possession of regulatory licences and permits where applicable;
f. Retail outlets should have a valid trading licence issued by the Commerce Division;
g. iBars, restaurants and hospitality activities should have a valid licence issued by the Malta Tourism Authority;
h. Applicants must not be defaulting on VAT, Income Tax, Social Security and rent payments to government;
i. Persons or undertakings engaged in activities specifically excluded under the de minimis regulations are not eligible for this incentive;
j. This incentive is intended to support enterprises that carry out a trade or business, hence it not intended for voluntary organisations.
What does the Incentive Comprise?
The Authority may approve a tax credit equivalent to 40% of eligible expenditure. An additional bonus of 20% (total 60% tax credit) applies to undertakings operating from Gozo. The maximum tax credit for the duration of this incentive shall be capped at €25,000 per undertaking. For applicants holding an Incentive Entitlement Certificate issued under the previous Tax Credits for Micro Enterprises and the Self Employed, also known as Micro Invest (for eligible expenses incurred and paid during the period 1st January 2010 to 31st December 2012), the applicable capping shall be reduced by the amount of any assistance already approved.
Costs must be incurred and paid for between 1st January 2013 and 31st December 2013. Eligible expenses include:
a) Costs subcontracted to third parties in relation to furbishing, refurbishing and upgrading of business premises including extensions or modifications to premises. Items related to furbishing, refurbishing and upgrading of business premises that are not part of a receipt issued by the subcontractor providing the services will not be accepted.
b) Investment in acquiring machinery, technology, apparatus or instruments which enhance the operations, including systems which help to save energy or to produce alternative energy.
c) Investment required to become compliant with regulations including Health & Safety, Environmental directives and Physical access.
d) Investment in one motor vehicle as long as such vehicle is involved in the carrying of goods (category N1, N2 or N3 motor vehicle), and Special Purpose Motor Vehicles (category E) as established in the Motor Vehicle Registration and Licensing Act (Cap. 368).
e) Wages costs covering a 12 month period pertaining to new jobs and apprenticeships created as from 1st January 2013 as long as this constitutes a net increase in the total number of employees of the applicant when compared to the employment figure as on the 30th November 2012.
Part-time employment is also considered eligible when such employment required the employee to work in excess of 20 hours per week.
Additional conditions apply.
For more information and to apply for this incentive contact Dr. Jonathan De Giovanni, Director of Legal and International Tax.