VAT, SSC or what?

Well,

the first question would be what you declared for your id card application  and what are you living from while in Malta ( money remitted to Malta has to be taxed in Malta) and what health insurance coverage you have.

Your ID card will expire soon and you will need to register for a e-residence card before the end of this year.

VAT will depend on what business exactly you are in! Some are exempt.

Cheers
Ricky

Hi Ricky, thanks for the answer.

My ID is valid until 2019 (is the residence card with a chip behind) and I have the top health insurance of Elmo that I need to renew only in September.

I work with Internet consultancy, mostly e-commece strategies, development, web performance and security.

Cheers,
Paulino

Hi Paulino,

then you already have the e-residence card and not the ' ID ' card ! Please be exact in what you say ....Malta does not issue ID cards to non-Maltese citizens anymore.

So the question would be where do you pay taxes! If you are resident in MAlta you are taxed here but can apply double-taxation agreements.

Cheers
Ricky

You're resident here in Malta! whether you render your services online or in a real premises, whether your clients are Maltese or from other countries, you pay taxes here in Malta.

The 3 common forms of tax structures for trading in most countries are:
self-employed,
partnership,
private limited company

There are advantages and disadvantages working in either of these structures. You need to seek professional advice from an accountant or tax specialist as to which is more suitable to your needs.
Once you decided, you have to register your business with Inland Revenue and take it from there. It's not difficult or very complex but it is time consuming to learn all the regulations and you may as well hire services of an accountant to handle your books and deal with the authorities on your behalf.

When you're trading under any of these structures, you will be paying social security here and therefore covered. You might then wish to stop your private medical insurance.

I forgot to to mention about VAT

There is a threshold for obligation to register for VAT. This threshold is very low in Malta so practically all businesses are liable to register for VAT.

As you are required to register for Tax purposes, as every resident is, why not explain and ask at the Tax Office when you do?

ricky wrote:

Hi Paulino,

then you already have the e-residence card and not the ' ID ' card ! Please be exact in what you say ....Malta does not issue ID cards to non-Maltese citizens anymore.

So the question would be where do you pay taxes! If you are resident in MAlta you are taxed here but can apply double-taxation agreements.

Cheers
Ricky

Hi Ricky,

I'm sorry for my mistake. I really don't know the differences between the "ID" and "e-residence". For me, the card that I have is an ID. I'm sorry for that.

I know that I need to pay taxes and I don't have doubt about that. But, the question is: with my situation (with the e-ID), need I a SSC number or a VAT number? In my head these are two different things, no?

Thanks and again, I'm sorry for the mistake.

Hi people,

Just for clarification because I think that I can't express in a good way:

Today, I'm lucky because I'm not paying taxes in any place in the world because my transition between two diffent countries and realities for tax payers. My case is not like a French or an Italian gentleman coming to Malta to live here. In one or another way, those countries have the same tax systems (I believe). In Brazil, we don't have social security number (because we don't have "social" or security there) and the tax number are different for companies and individuals (numbers, systems, government offices, etc). Also, we just pay taxes one time per year, companies pay tax over tax over tax over tax, etc. (just to show simple differences).

So, the question is: to be legal with my duties, I need to pay taxes and I need to pay here (remember that I told: I don't have my tax payer number in Brazil anymore). In my head I need a VAT number. Is this correct? If yes, what's the difference between the VAT and SSC? Do I need both?

Thank you for the effort guys. I really appreciate this help and I'm sorry for my mistakes.

Regards

Basically the ID card is for Maltese citizens and contains biometric information and may be used as a travel document within the Schengen area.
EResidence card is for those other than Maltese citizens. It is a registration document and does not contain biometric information and is not a valid travel document.

redmik wrote:

Basically the ID card is for Maltese citizens and contains biometric information and may be used as a travel document within the Schengen area.
EResidence card is for those other than Maltese citizens. It is a registration document and does not contain biometric information and is not a valid travel document.

Redmik, thak you for this info. Now I know the differences between both documents.

Regards

pmichelazzo wrote:

Hi people,

Just for clarification because I think that I can't express in a good way:

Today, I'm lucky because I'm not paying taxes in any place in the world because my transition between two diffent countries and realities for tax payers. My case is not like a French or an Italian gentleman coming to Malta to live here. In one or another way, those countries have the same tax systems (I believe). In Brazil, we don't have social security number (because we don't have "social" or security there) and the tax number are different for companies and individuals (numbers, systems, government offices, etc). Also, we just pay taxes one time per year, companies pay tax over tax over tax over tax, etc. (just to show simple differences).

So, the question is: to be legal with my duties, I need to pay taxes and I need to pay here (remember that I told: I don't have my tax payer number in Brazil anymore). In my head I need a VAT number. Is this correct? If yes, what's the difference between the VAT and SSC? Do I need both?

Thank you for the effort guys. I really appreciate this help and I'm sorry for my mistakes.

Regards

I can understand your feelings. It's not easy settling up in another country and having to deal with all things new at the same time. It must be worrying you having to comply with the regulations when you don't know them and don't know your obligations. Let me try to explain a few things:

Social Security Contribution (SSC): European governments often provide welfare programmes to look after the sick, unemployed, retired people etc. All these cost money and SSC is the method to finance it. Each worker pays 10% of his income towards this (there is a maximum SSC payments per year). Employers also pay the same amount (in addition). Think of SSC as another tax.
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Value Added Tax (VAT): is a tax on consumption in Europe. Therefore it is paid by the end consumer who makes the purchase/consumption in Europe. If you're in business, you collect VAT by adding it to your cost and then give it to the governemnt every 3 months. All relevant VAT you paid on your business purchases, you can deduct from this, so you get back any VAT you paid. There is no VAT on goods and services you provide to clients outside Europe, eg. the USA or Brazil. Rules for cross border trade within EU are also different.

Some goods and services are VAT exempt, for example books and basic food (bread, raw meat, milk, rice etc). No VAT is collected or paid on VAT exempt goods and services.
Some goods and services are zero rated. Again no VAT is collected or paid on zero rated goods and services.
The difference is that zero rated VAT can be changed at any time (by the tax office/government) but VAT exempt requires an act of parliament and legislation to change (harder but still possible).

VAT is set in each country in Europe and can be slightly differently: the rate, also what goods and services are exempt may be different in different countries.
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Income Tax: is a deduction on earnings. Individuals and companies have to pay it on their income.
Tax return is a form to fill once a year to declare income to the tax office.
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Taxation in each country is very different.
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As you can see VAT and SSC are separate things and payments go to different departments. You need to register for all these (separately) and communicate different information with different offices.

A business needs registration, so the authorities know about it. It also registers for VAT and SSC.

An individual coming to Malta from outside has to register for SSC and tax (either employed or self employed). He then has to pay tax and SSC on his income.

If you trade through a limited company then you pay: corporation tax (company tax), VAT, employer SSC. You also collect employee SSC and pay it to government.

I hope I didn't confuse you further!

Why don't you just contact the tax authorities and ask?

They provide a very helpful service and its free!

https://ird.gov.mt/

Terry