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[Corporate Tax] Group Deduction Rules: Surrendering of Unabsorbed Capital Allowances

Legal Notice 205 of 2022 has introduced the possibility to companies forming part of a group for tax purposes to surrender unabsorbed capital allowances.

For the year of assessment 2022, the claimant company can deduct for tax purposes unabsorbed capital allowances which have been surrendered by another company forming part of the same group.

Only unabsorbed capital allowances relating to the year of assessment 2021 and earlier can be surrendered to a claimant company.

The rules further stipulate that the claimant company should be a company which has been granted a benefit under the Covid-19 Fiscal Assistance – Postponement of Payment of Certain Taxes Deferral Scheme.

The maximum amount of unabsorbed capital allowances which may be surrendered under these rules shall not exceed 1,000,000 euro for each group.

For further information, please contact:

Franco Falzon C.P.A. LL.M (Managing Director)

E: info@ffinternational.com.mt

T: +356 2010 7771 (office)

M: +356 9989 5679 (mobile)

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