Taxation of Royalties on qualifying literary works

Pursuant to the announcement in the Budget for 2021 of a flat rate of 15% on royalties earned by authors (See MIT news 19 October 2020), article 15 of the Budget Measures Implementation Bill sets out the proposed new article 31F of the Income Tax Act (CAP 123).

In summary, the proposed provision will apply to individuals in their capacity as author of a qualifying literary work by virtue of their title to the copyright on that work conferred by the Copyright Act. It will allow the said individual to opt for taxation at 15% on the gross amount of the royalties (final tax).

Once enacted, this new article will apply to royalties derived on or after 1 January 2021.

 

source: parlament.mt