TAXATION

COVID-19: deferral of tax payments

The Ministry for Finance and Financial Services has announced that the Tax Deferral Scheme has been extended and that the deadline for the submission of the application form is 15th May 2020.

The deferral applies to enterprises and self-employed individuals, to pay Provisional Tax, VAT and National Insurance Contribution on salaries, for taxes owed up to and including June 2020.

The Tax Deferral Scheme is primarily intended for, but not limited to, the tourism and hospitality, entertainment, transport, and manufacturing sectors. The scheme will allow companies to retain the National Insurance collected on their employees’ wages, for the entire duration of the deferral.

Without prejudice to the right of each enterprise to prove a “significant downturn in turnover” in its specific circumstances, a drop of circa 25% or more in sales registered would certainly satisfy this condition.

This would be ascertained on the basis of a 3 month period in which March would be either the first or the second month, i.e. either from February to April or else from March to May 2020 as compared with the same period of 2019. This would in part be based on estimates but as long as such estimates are drawn up in a reasonable manner then they should suffice. Enterprises claiming this benefit should keep records of these estimates.

The settlement period is still to be announced.

The application form can be downloaded here >

 

Excluded categories

Companies and self-employed individuals which have failed to comply with their tax obligations (submission of documents / returns and payments) falling due by the 31st December 2019 and who opted to pay VAT under the Mini One Stop Shop (MOSS).