Personal Retirement Scheme Rules 2015

April 2, 2015
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Amendments to the Personal Retirement Scheme Rules, were issued in 2015, through Legal Notice 117 of 2015, that have raised the maximum amount of tax credit in relation to any personal retirement scheme or policy of insurance provided for by Article 57(1)(b) of the Income Tax Act from €150 to €300.  This Legal Notice has thus doubled the fiscal incentive for Maltese residents to invest in private products offered by local banks, life insurance companies and financial institutions.

A tax credit is given to any person who is a member of, and makes contributions to, any one or more personal retirement schemes or pays a premium in relation to a policy of insurance in the year immediately preceding the year of assessment.

The amount of the income tax so chargeable shall be reduced by the amount of the tax credit.   This will be applicable on any contributions made by a person to any personal retirement scheme or premiums paid in respect of a qualifying policy of insurance. The tax credit will be equal to the lower of:

  1. 15% of the aggregate of contributions or premiums paid by a person during the year immediately preceding a year of assessment in respect of membership in any personal retirement schemes or a policy of insurance held with a company authorised to carry on long term business; and
  2. €300.

The tax credit shall only be allowed in respect of qualifying schemes or policies of insurance as may be prescribed by the Commissioner of Inland Revenue.

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