Fiscal Unit Registration Guidelines updated

The CfR Guidelines issued upon the launch of the registration process for fiscal units (See MIT News 18 May 2020) have been updated to reflect changes to paragraphs (i) and (vi).

Paragraph (i) provides that in order to join or form part of a fiscal unit, a company must be a ninety-five (95%) subsidiary of its parent company at the end of the year preceding the year of assessment in which an election to form such fiscal unit is made. It furthermore provides that the said companies must have coterminous accounting periods.

The change to paragraph (vi) clarifies the process for companies not resident in Malta forming part of a fiscal unit and provides as follows:

In terms of the Rules, in order for a company that is not resident in Malta to form part of a fiscal unit and act as a Principal Taxpayer, that company should fall within the definition of “a company registered in Malta”.

In order to satisfy such a definition for the purposes of the Rules, a foreign principal taxpayer would need to appoint a fiscal representative in Malta. Such a fiscal representative may be a Maltese-resident transparent subsidiary forming part of the fiscal unit.

Furthermore, any company that is not resident in Malta that registers to form part of a fiscal unit, would be required to register with the CfR in order to be granted a Maltese income tax registration number prior to being registered as part of a fiscal unit.

Click here to view the revised guidelines.