Keeping up to date: Malta Enterprise and other support measures

Publication
October 30, 2023

As PwC Malta's Incentives Team, we strive to remain up to date on the latest news on incentives and grant schemes and share the latest insights. In this newsletter, we outline the re-launching of an incentive scheme related to the upskilling of employees and set out reminders on impending application deadlines.

A. Recent Legislative Developments
B. Important reminders

A. Recent Legislative Developments

1. Skills Development Scheme - relaunched

The Skills Development Scheme is intended to support undertakings when engaging in training their employees to develop and update their skills and knowledge as well as the training of new employees to acquire the right skills and knowledge to perform effectively.

The recently relaunched version of the scheme includes training relating to enhancing communication and digital skills and ESG-related practices.

This measure is available to duly registered undertakings, including self-employed persons, that carry out in Malta at least one of several varied qualifying activities specifically prescribed in the applicable Guidelines. The qualifying training (as set out in the Guidelines) may be provided by employees of the undertaking or related undertakings or by external experts and should not relate to any periodic/routine training or training which is considered mandatory under national law.

The aid awarded depends on the size of the undertaking and is calculated as a percentage (ranging from 50% for large undertakings to 70% for small undertakings) of eligible costs, including wage costs of trainees and trainers covering the direct contact hours of the training programme, hourly costs covering the training provided by an external expert, air travel expenses and subscription costs (subject to certain conditions). The maximum support per skills development project shall be €2,000,000.

The support may be awarded in the form of a tax credit, a cash grant or a mix of both.

Applications should be submitted at least one month before the training programme commences for support in the form of tax credits, and at least three months before the start of the training programme for aid in the form of cash grants. In any case, applications under this Scheme should reach Malta Enterprise Corporation (MEC) by 30 November 2023.

B. Important reminders

The submission deadline for other important incentive schemes is also approaching. Here we take the opportunity to set out some salient points on several such schemes that are administered by MEC.

1. Smart and Sustainable Investment Grant

The Smart and Sustainable Investment Grant Scheme provides funding to support an undertaking to invest in investments that lead to more sustainable processes. This Scheme is applicable for investments of at least €10,000 intended to achieve sustainability and improve environmental performance or digitisation leading to growth potential.

Aid is awarded in the form of a cash grant covering 50% of the eligible costs (capped at €100,000 cash grant per project). In addition, a tax credit of up to €40,000 may also be awarded if certain conditions are met.

Application forms should reach MEC by not later than 30 November 2023. Further information on this Scheme may be found here.

2. Support for Reducing the Environmental Impact of Construction

The Support for Reducing the Environmental Impact of Construction Scheme aims to support businesses that are engaged in construction activities to invest in eligible machinery and equipment that reduce the negative impact of their activities by:

facilitating the reduction in the volume of construction waste
controlling dust emissions, and
facilitating the replacement of equipment

Aid is provided in the form of tax credits at 50% of eligible costs (capped at €100,000), which should be utilised within 5 years.

Application forms should reach MEC by not later than 30 November 2023. Further information on this Scheme may be found here.

3. Micro Invest

Assistance under this Scheme is provided to self-employed persons or undertakings employing less than 50 full-time employees and having an annual turnover of less than €10 million. Aid is granted in the form of a tax credit amounting to 45% of eligible expenditure (65% for undertakings operating in Gozo (unless these are start-up undertakings) and in other specific circumstances) and should be utilised within the period prescribed on the incentive entitlement certificate. The maximum amount of aid awarded under this Scheme is capped at €50,000 over three years on a group basis (may be increased to €70,000 in certain circumstances).

Companies still have a chance to apply for this scheme in relation to capital expenditure and increased wage costs incurred in 2022, and the deadline to do this is 13 December 2023. For such applications, the tax credits awarded in the Incentive Entitlement Certificate may then be utilised from the year of assessment 2024.