The final tax of 15% can be applied on receipts of rental income that otherwise would be chargeable to tax either as part of the trading income under Art 4(1)(a) ITA or as passive income under Art 4(1)(e) ITA. As indicated above, the 15% is a final tax on the gross rental income and therefore the company may not claim any expenses as a deduction against the said income to the effect that in certain circumstances, the application of the provisions of Art 31D ITA (i.e. 15%) may be less favourable than the provisions of Art 4(1)(a) ITA and/or Art 4(1)(e) ITA.

In view of the above, the best course of action would be to determine whether the Company has earned qualifying rental income for the year and establish whether it would be beneficial for the Company to opt for the provisions of Art 31D ITA.

The deadline to avail of this final tax of 15% is the 30th April of each year, by which date, details must be filled on a prescribed form and filed together with the payment to the Maltese Tax Authorities.

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