VAT in Malta – Part 1: How to Analyse a Transaction from a VAT Perspective?

When determining whether a particular transaction falls within the scope of VAT or not, a series of criteria must be evaluated.

Following which, should a transaction fall within the scope of VAT, reference is to be made to five basic questions, which one should scrutinise to determine the correct VAT treatment of any transaction, irrespective of the industry in which the taxable person operates.

How can we assess if a transaction falls within the scope of Malta VAT?

Who are the parties involved?

What is the nature of transaction?

Where is the transaction taking place?

Is an exemption possible?

Who is liable for the VAT payment?

Basic Example

Source: Zampa Debattista