INCOME TAX AND DUTY ON DOCUMENTS AND TRANSFERS ON TRANSFERS OF DWELLING HOUSES BY COMMERCIAL PARTNERSHIPS EXEMPTION [ S.L.123.58 1 SUBSIDIARY LEGISLATION 123.58 INCOME TAX AND DUTY ON DOCUMENTS AND TRANSFERS ON TRANSFERS OF DWELLING HOUSES BY COMMERCIAL PARTNERSHIPS EXEMPTION ORDER 16th October, 2001 LEGAL NOTICE 244 of 2001, as amended by Legal Notice 409 of 2007. 1.
(1)The title of this Order is the Income Tax and Duty on Documents and Transfers on Transfers of Dwelling Houses by Commercial Partnerships Exemption Order. Title and application.
(2)This Order applies to any transfer of a dwelling house made by a commmercial partnership constituted under the laws of Malta to an individual by means of a deed published not earlier than the 21st November, 2000 and not later than 31st October, 2001 and which satisfies all the following conditions (
- a)the transferee is on the date of the transfer a partner in the said partnerhip and has been a partner of that partnership without interruption since at least the 20th November, 2000 up to the date of the transfer; (
- b)on the 20th November, 2000 and up to the date of the transfer, the transferee alone or together with a member or members of his family held directly or indirectly an aggregate of at least twenty percent of the interests or of the voting rights in that partnership; (
- c)at 20th November, 2000 and up to the time of the transfer, the transferee or a member of his family occupied without interruption the dwelling house as his sole ordinary residence. 2. In this Order - Interpretation. (
- a)a member of the family of the transferee means his spouse, ascendant, descendant, brother or sister, or a descendant of his brother or sister; (
- b)"dwelling house" includes a garage attached to or underlying that house or a garage of not more than 30 square meters situated within 500 meters of that house and transferred by the said partnership to the transferee by means of the same deed with that house. 3. Upon a transfer to which this Order applies (
- a)if the use of the dwelling house by the occupier or occupiers up to the date of the transfer is deemed to constitute a benefit by reason of an employment or office in terms of article 4
(1)(
- b)of the Income Tax Act, no tax shall be chargeable under that Act on the Exemptions. Amended by: L.N. 409 of 2007. Cap. 123. 2 [ S.L.123.58 INCOME TAX AND DUTY ON DOCUMENTS AND TRANSFERS ON TRANSFERS OF DWELLING HOUSES BY COMMERCIAL PARTNERSHIPS EXEMPTION value of the said benefit; (
- b)if the transfer constitutes a benefit by reason of an employment or office in terms of the said article 4
(1)(
- b)of the Income Tax Act, no tax shall be chargeable under that Act, on the value of the said benefit; (
- c)no gain shall be deemed to arise from the said transfer for the purposes of article 5 of the Income Tax Act; Cap. 364. Exemptions subject to conditions. Cap. 372. Cap. 123. (
- d)no duty shall be chargeable in terms of article 32 of the Duty on Documents and Transfers Act in excess of €2.50 for every €100 or part thereof of the deemed transfer value determined in accordance with article 4(a). 4. The exemptions granted by this Order shall be subject to the following conditions (
- a)the deemed transfer value referred to in article 3(
- d)shall be the cost at which the partnership had acquired the dwelling house increased by the cost of improvements incurred by the partnership before the 21st November, 2000 as shown in the records which that partnership is required to keep in accordance with article 19 of the Income Tax Management Act disregarding any revaluation that may have been made by the partnership of the value of the said property; (
- b)if the actual consideration for the transfer is less than the deemed transfer value determined as aforesaid the shortfall shall not be treated as a loss for any of the purposes of the Income Tax Act; (
- c)for the purpose of determining the capital gains in terms of the Income Tax Act arising upon a subsequent transfer of the dwelling house in full or in part by the transferee, the cost of acquisition of the dwelling house shall be deemed to be the deemed transfer value as determined in accordance with paragraph (a), and notwithstanding the provisions of article 5
(10)(
- b)and (
- c)of the said Act, no capital loss resulting from or bad debt incurred in relation to any other transfer shall be set off against any capital gains determined as aforesaid; INCOME TAX AND DUTY ON DOCUMENTS AND TRANSFERS ON TRANSFERS OF DWELLING HOUSES BY COMMERCIAL PARTNERSHIPS EXEMPTION [ S.L.123.58 (
- d)when the parties to the transfer wish to avail themselves of the exemptions granted by this Order they shall make and give in a form supplied by the Commissioner all the information specified in that form. The declarations in the said form shall be signed on behalf of the partnership by an individual who is duly authorised for that purpose, by the transferee, by a certified public auditor and by a notary public as specified in the said Schedule and the form shall be delivered to the Commissioner of Inland Revenue together with the notice relative to the deed required in terms of article 51 of the Duty on Documents and Transfers Act and the Duty on Documents and Transfer Rules, within the time limit prescribed for the delivery of that notice: 3 Cap. 364. S.L.364.06 Provided that in the case of a transfer made before the date of this Order the said form shall be delivered to the Commissioner at the Capital Transfer Division of the Inland Revenue Department, Valletta, by not later than the 31 October, 2001; (
- e)the parties to the deed shall furnish to the Commissioner such further information and documents as he may at any time reasonably require for ascertaining the eligibility to the exemptions granted by this Order; (
- f)in the event that any condition set out in this article is not fulfilled or that any information or declaration given or made for the purposes of this Order results to be incorrect in any material respect, the exemptions shall be forfeited; (
- g)this Order shall have such retroactive effect as may be necessary to give effect to the exemptions granted herein with respect to any transfer to which this Order applies made before the date of this Order. 5. The exemptions granted by this Order may not be availed of in part, and when they have been validly availed of all the parties to the transfer shall be deemed to have accepted the conditions set out in article 4 notwithstanding any renunciation or reservation made by any person. Exemptions may not be availed of in part. 4 [ S.L.123.58 INCOME TAX AND DUTY ON DOCUMENTS AND TRANSFERS ON TRANSFERS OF DWELLING HOUSES BY COMMERCIAL PARTNERSHIPS EXEMPTION SCHEDULE Information and Declarations for the purposes of the Income Tax and Duty on Documents and Transfers on Transfers of Dwelling Houses by Commercial Partnerships Exemption Order Part A Description of the dwelling house and the transfer value information to be supplied and declaration to be made and signed by an individual who is an officer of the partnership duly authorised for this purpose 1. Address ....................................................................................... 2. Date when acquired by the partnership ............................................ 3. Cost at which the property was acquired by the partnership as recorded in the partnership’s records ............................................... 4. Cost of improvements as recorded in the partnership’s records ........ 5. Deemed transfer value (3 + 4) ...................................................... 6. Value of consideration payable by the transferee for the transfer............ 7. Excess (if any) of the deemed transfer value (as in 5) over the consideration (as in 6) ................................................................. I declare that the above information is correct and that I am authorised by the partnership to sign this declaration. Signed for and on behalf of the partnership by (name of individual) ................ Designation .................................... Address ................................................................................................. Identity document number .................................... Signature ..................................... Date ........................................... Part B Declaration by Certified Public Auditor I declare that the information given in Part A corresponds to the relevant records of ................................................................ for the financial years ending .............................................. . Signed by (name of Certified Public Auditor) ........................................ Address ................................................................................................. Signature ............................................... Official Stamp ........................................ Date ...................................................... Part C INCOME TAX AND DUTY ON DOCUMENTS AND TRANSFERS ON TRANSFERS OF DWELLING HOUSES BY COMMERCIAL PARTNERSHIPS EXEMPTION [ S.L.123.58 5 Description of the interests and voting rights in the partnership Declaration to be made and signed on behalf of the partnership by an individual who is duly authorised for such purpose and by the transferee Name of partner Description of interests held Voting rights held (as a percentage of total voting rights) Relationship to transferee (if any) Signed for and on behalf of the partnership by (name of individual) ................................ Signature ....................................... Name of transferee .............................................................. Address ................................................................................................. Identity document number ..................................................................... Signature ............................................. Date .................................................... Part D Declaration to be made and signed on behalf of the partnership by an individual who is duly authorised for this purpose and by the transferee We declare that on 20 November 2000 and up to today ...................... occupied the dwelling house in question as his/their sole ordinary residence and that the said occupier/s is/are related to the transferee as follows: ..................................................................................................... Signed for and on behalf of the partnership by (name of individual) ..................................... Signature ................................................... Name of transferee ......................................................... Signature ................................................... Date ......................................................... Part E Declaration by Notary Public I declare that the declarations in Parts A, C and D have been signed in my presence after that I, Notary, explained to the signatories the purport thereof and of the Tax on Transfers of Dwelling Houses by Commercial Partnerships (Income Tax and Duty on Documents and Transfers) Exemption Order. Signed by (name of Notary Public) ............................................................. Address ........................................................................................................ Signature .............................................. Official Stamp ...................................... Date ...................................