NEW MEANS OF TRANSPORT

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NEW MEANS OF TRANSPORT
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DEFINITION
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Land vehicles

• Motorised land vehicles the capacity of which
  exceeds 48 cc or the power of which exceeds 7,2
  kw
• supplied not more than 6 months after the first
  entry into service or
• that have not travelled more than 6.000 km

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Vessels

• Vessels exceeding 7,5 meters in length
• supplied not more than 3 months after the first
  entry into service or
• that have not sailed for more than 100 hours
• Exception vessels used for navigation on the
  high seas and carrying passengers for reward or
  used for the purpose of commercial, industrial
  or fishing activities

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Aircraft

• Aircraft the take-off weight of which exceeds
  1.550 kg
• supplied not more than 3 months after the first
  entry into service or
• that have not flown for more than 40 hours
• Exception aircraft used by airlines operating
  for reward chiefly on international routes

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Transport

• Intended for the transport of passengers or goods

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INTRA-COMMUNITY ACQUISITION
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Subject to VAT

• Always subject to VAT in Malta
• Whatever is the quality of the vendor (never
  treated as a second-hand goods)
• Whatever the qualifications of the acquirer
  (taxable person, non-taxable legal person,
  private individual)
• (Even if there is no transaction)
• Without the application of any threshold
• Distance sales regime never applicable

Art. 4(1)(b) VAT Act
Item 2(a) Part Two Sixth Schedule
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Payment of VAT taxable person art.10 (no
registration at his name)

• ICA made by a taxable person registered under
  article 10 not asking for a registration of the
  means of transport at his name, that is to say
  that the car is used
• for the purpose of resale, whether in the state
  in which they were acquired or after treatment or
  processing or inclusion in other goods supplied
  by that person, in the normal course of that
  person's economic activity
• (for the purpose of being used in the normal
  course of that persons economic activity)
• Payment of VAT in the regular VAT return

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Payment of VAT taxable person art.10
(registration at his name)

• ICA made by a taxable person registered under
  article 10 asking for a registration of the means
  of transport at his name, which includes
• for the purpose of the carriage by that person of
  goods or passengers for a consideration
• for the purpose of being provided by that person
  under a charter or hire agreement
• for the purpose of being provided by that person
  for hire with a driver or for self-drive hire or
  of being used for driving instructions, provided
  they are so used, in each case, in the normal
  course of that persons economic activity
• for the purpose of being used in the normal
  course of that persons economic activity or for
  private purposes

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Payment of VAT taxable person art.10
(registration at his name)

• This person must
• submit a special return furnished by the customs
  office
• prove to this customs office that he is
  registered under article 10 of the VAT Act and is
  liable to pay VAT according to article 21(1) of
  the VAT Act through his VAT return
•   A copy of this special return as well as the
  proof of payment, if any, must be submitted to
  the competent registration office at the same
  time as the demand for registration of the means
  of transport

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Payment of VAT other person than a taxable
person art.10

• ICA made by any other person than a taxable
  person registered under article 10
• This person must
• present the means of transport to a customs
  office of its choice, with the invoice as well as
  all the documents necessary to check if the
  information reported on the invoice is correct,
  that is to say order forms, contract, transport
  and payment documents related to the means of
  transport, not later than the fifteenth day of
  the month following that during which the
  intra-Community acquisition occurs
• submit a special return furnished by the
  customs office
• pay to the customs office, not later than the
  fifteenth day of the month following that during
  which the intra-Community acquisition occurs, the
  value added tax due on the intra-Community
  acquisition

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Payment of VAT other person than a taxable
person art.10

• ICA made by any other person than a taxable
  person registered under article 10 (continued)
•   A copy of this special return as well as the
  proof of payment, if any, must be submitted to
  the competent registration office at the same
  time as the demand for registration of the land
  vehicle, the vessel or the aircraft

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INTRA-COMMUNITY SUPPLY
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By a taxable person art.10 acting as such

• Acting in the framework of his economic activity
• Always exempt from VAT if transport is proven
• Whatever the qualifications of the acquirer
  (taxable person, non-taxable legal person,
  private individual)

Art. 9 VAT Act
Item 3(1) or (2) Part One Fifth Schedule
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By another person than a taxable person art.10

• Supplier becomes in any case a taxable person for
  this supply
• Supply exempt with right to deduct VAT (refund)
• Refund is however limited to the tax that would
  be chargeable if the supply by him of the means
  of transport were a taxable supply
• Moreover, refund is in any case limited to the
  VAT paid on the purchase made by the vendor

Item 3(2) Part One Fifth Schedule
Art. 5(4) and 25(1) VAT Act
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Example intra-Community supply by a private
individual

• A Maltese private individual purchases a car for
  25,000 liri VAT (18) 4,500 liri
• He sells the car to an Italian private individual
  after 5 months (10,000 kilometers) for 30,000
  liri. The car is transported to Italy.
• The Italian VAT is due by the Italian private
  individual 30,000 liri in EUR X 20
• The Maltese private individual can deduct Maltese
  VAT paid on the purchase up to 30,000 liri x 18
  5,400 liri but the deduction will be limited to
  4,500 liri
• The Maltese private individual becomes an
  occasional taxable person for this operation