Maltese VAT legislation contains specific and separate provisions dealing with tax invoices and fiscal receipts. The obligations concerning tax invoices are regulated at a European level by the European VAT Directive (2006/112/EC) - with the respective provisions being also transposed into the Maltese Value Added Tax Act (VATA). Specific provisions regulating fiscal receipts are a local requirement and therefore entirely regulated by provisions in the VATA.
Tax invoices and fiscal receipts are used to document the supply of goods and services. The main difference between the two documents is that a tax invoice is required to be issued when a person registered under Article 10 makes a supply to another person in possession of a VAT identification number, whereas a fiscal receipt must generally be issued when such supplies are made to other persons. The VATA also provides for some exceptions.
Obligation to issue a tax invoice
In terms of Article 50(1) of the VATA , every person registered for VAT under Article 10 who makes a supply (other than an exempt without credit supply), to another VAT registered person has the obligation to issue a tax invoice to the buyer within the times stipulated in the law.
In order for a document to qualify as a valid tax invoice, it must include the minimum requirements as set out in the EU VAT Directive and VATA.
The tax invoice issued by the supplier will also be required by the buyer so as to be able to substantiate the claim to recover VAT incurred on the underlying supply (if such VAT is recoverable). Indeed, failure to be in possession of a valid tax invoice, may preclude the taxable person from recovering the relative input tax.
Who is required to issue a fiscal receipt?
Any person who makes any supply, other than an exempt without credit supply or other than a supply in respect of which a tax invoice is required, has the obligation to issue a fiscal receipt to the person to whom a supply is made for the consideration paid to him. Such fiscal receipt is to be issued immediately after the payment has been effected to the extent covered by the payment.
How does a document qualify as a fiscal receipt?
A document is considered to be a valid fiscal receipt when issued among other things in one of the following ways:
when provided by the Commissioner for Revenue;
when issues through fiscal cash register approved by the Commissioner;
when issued through a computer system that uses a fiscal printer approved by the Commissioner; or
when issued by means of a computerised or electronic system or a point of sale system as approved by the Commissioner.
In the case where the document is issued through a machine or system approved by the Commissioner (i.e. points 2 to 4 above) then evidence of such approval (and EXO number) must also be printed on the relative document. In order to obtain an 'EXO' number, a request is required to be submitted to the Commissioner for Revenue. In the case where the fiscal receipt is issued by means of a computerised or electronic system or a point of sale system (i.e. point 4 above) then the approval request needs to be accompanied with a number of documents including confirmation by an auditor that amongst others provides assurance that the system is in line with the Maltese VAT legislation and, more specifically, with the Thirteenth Schedule to the VAT Act and other applicable guidelines. This should include ensuring that all the necessary information to be included in the fiscal receipt is actually present and that the data in the system is secure and has a proper audit trail.
The production of fiscal receipts is highly regulated and the approvals provided by the Commissioner are extremely specific and may require updating even if, for example, the same approved system is used in different segments or locations of the same business or if the said system is updated.
Persons supplying goods or services under the one-stop shop or the import one-stop shop, are not required to issue fiscal receipts for such supplies of goods and services.
Other considerations
One of the main consequences of failing to comply with the above requirements of issuing tax invoices or fiscal receipts is that such failure qualifies as a criminal offence. A person who fails to provide or produce a tax invoice or a fiscal receipt when requested by the Commissioner, may on conviction, be liable to a fine of between €700 and €3,500. This is irrespective of whether the VAT on the respective supply was accounted for (and settled) appropriately or otherwise.
If you have any questions in respect of when to issue an invoice or a fiscal receipt or you would like to explore the possibility of obtaining an EXO number so as to simplify the burden related to the issuing of fiscal receipts, feel free to contact us.
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