SME Scheme – General features
Exemption
It is possible to opt for the SME scheme in Malta.
Transactions excluded from the SME scheme
The following transactions and special schemes are excluded from the SME scheme:
- Occasional transactions, like the supply before first occupation of a building or parts of a building or the supply of building land
- Exempt cross-border supplies of new means of transport made from one Member State to another
National annual threshold
The national annual threshold in Malta is €35,000.
Malta does not apply sectoral thresholds.
More information on the national annual threshold is available on TEDB.
Domestic SME scheme
Simplified VAT obligations
A small enterprise established in Malta who applies the SME scheme in Malta only (domestic SME scheme) is released from the following VAT obligations:
- to submit detailed periodic VAT returns (in favor of an annual simplified declaration)
- to issue full tax invoices for both B2B and B2C supplies (in favor of simplified invoices)
- to submit Recapitulative Statements
Cross-border SME scheme
The cross-border SME scheme applies in the following situation(s):
- The small enterprise applies the SME scheme in Member State(s) other than the Member State of establishment, or;
- The small enterprise applies the SME scheme both in the Member State of establishment and in other Member State(s).
Simplified VAT obligations
The VAT registration in each Member State of establishment where the small enterprise applies the Cross-Border SME scheme is replaced by a single prior notification to be submitted in the Member State of establishment.
The annual simplified declaration VAT returns are replaced by a single quarterly report for all Member States to be submitted in the Member State of establishment.
Currency
The values of supplies of goods and services to indicate in the prior notification, in the update to a prior notification and in the quarterly reports must be in EUR.
Way of submission
The prior notification, the update to a prior notification and the quarterly reports should be submitted by electronic means on this page (page under construction).
Additional simplified VAT obligations
Exempt small enterprises applying the cross-border SME scheme in Malta are released from the following VAT obligations:
- to submit detailed periodic VAT returns (in favor of an annual simplified declaration)
- to issue full tax invoices for both B2B and B2C supplies (in favor of simplified invoices)
- to submit Recapitulative Statements
Loss of simplified VAT obligations
Non-compliant small enterprises will be required:
- to VAT register
- to submit detailed periodical VAT returns
- to submit Recapitulative Statements
Transitional period
Malta does not apply any transitional period in case the national annual threshold is exceeded during the current calendar year.
The information on the national annual threshold is available on TEDB.
Quarantine
Quarantine period in case of exclusion from the SME scheme
Small enterprises excluded from the SME scheme in Malta are not able to benefit from that exemption during a one year quarantine period.
Quarantine period in case of voluntary departure from the SME scheme
Small enterprises who decide to voluntarily leave the SME scheme in Malta are not able to benefit from that exemption during a one year quarantine period.
You can consult the quarantine period applicable in Malta on TEDB database.
Appeals
Domestic SME scheme
Appeals should be addressed to your Member State of establishment (MSEST).
Cross-border SME scheme
Member State of establishment (MSEST)
Appeals related to the following topics should be addressed to MSEST:
- Union annual turnover
- Prior notification, correction and update to a prior notification
- Quarterly reports and correction of a quarterly report
- Exclusion for exceeding the Union annual turnover
Member State of exemption (MSEXE)
Appeals related to the following topics should be addressed to MSEXE:
- National annual turnover
- Denial to access the cross-border SME scheme in MSEXE
- Loss of simplified VAT obligations in respect of MSEXE
- Exclusion for exceeding the national annual threshold/sectoral threshold in MSEXE