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Investment Aid Regulations 2021

The Investment Aid Scheme, which is administered by Malta Enterprise, aims to sustain the regional industrial and economic development of Malta. This measure facilitates initial investments by encouraging the setting up of new establishments as well as the expansion and development of existing businesses. 

The aid awarded under these guidelines shall amount to a percentage of qualifying expenditure incurred and may take the form of tax credit (which may be claimed against future tax bills) and/or cash grant.

Duration of the Scheme

The investment aid is available as from 1 January 2021 and shall be applicable until 31 December 2021.

Which undertakings are eligible?

To be eligible for aid through this incentive, an undertaking must operate from Malta and be incorporated in the European Union as a partnership en nom collectif, en commandite or a limited liability company, cooperative or similar set-up. To benefit from tax credit, partnerships are required to register under Article 27(6) of the ITMA to be treated as a company.

Which projects are eligible?

Cash grants may only be awarded to eligible projects for which an application is submitted and approved before Start of Works and during the validity of the scheme.

Projects starting before 1st January 2021 or having a "Start of Works" prior to the approval of the Malta Enterprise may only be awarded aid in the form of tax credits.

Eligible investment projects may only be awarded aid in respect of projects commencing after 31st December 2021 but in no case later than 31st December 2023, or later if the "Start of Works" was delayed due to factors outside the control of the aid beneficiary as shall be determined by the Malta Enterprise, as long as the beneficiary submits an application for assistance and the aid in respect of such projects is approved by the Malta Enterprise during the validity of the scheme which in no case shall be later than 31st December 2021. 

Eligible projects for SMEs

Investment Aid shall be awarded to SMEs in respect of initial investment in tangible and intangible assets, resulting in:

  1. The setting up of a new establishment;

  2. The extension of the capacity of an existing establishment;

  3. A fundamental change in the overall production process of an existing establishment;

  4. Diversification of the output of an establishment into product not previously produced in the establishment.  

Eligible projects for Large Enterprises

Investment Aid shall be awarded to large Enterprises in respect to “initial investments in favour of new  economic activities” which must consist of:

  • Investment in tangible and intangible assets related to the setting up of a new establishment or to the diversification of the activity of an establishment under the condition that the new activity is not the same or similar to the one previously performed in the establishment;
     

OR

 

  • The acquisition of the assets belonging to an establishment that has closed or would have closed had it not been purchased and is bought by an investor unrelated to the seller, under the condition that the new activity to be performed using the acquired assets is not the same or similar to the activity performed in the establishment prior to the acquisition.

Which are the Qualifying Activities?

  • Manufacturing

  • Maintenance Repair and Overhaul of watercraft, aircraft or industrial engines, or electromechanical equipment.

  • Industrial Services

  • Computer Programming

  • Data processing and hosting facilities

  • Call Centre

  • Research, development, and design

  • Treatment of waste

  • The operation of environment solutions

  • The carrying our of activities related to Life Sciences

  • Pharmaceutical activities

  • Activities for the production of feature films, documentaries, and audio-visual productions

  • Activities for the production of audio recording

  • Design and development of digital video games

  • Education and tuition

  • The operation an immovable structure providing human inpatient and/or daycare services

  • Freeport operations

  • Operation of logistic facility

  • Industrial packaging

  • The operation of hotels and guest houses

  • The provision of knowledge-intensive services

  • The restoration of works of art and antiques

  • The operation of temporary or permanent facilities used for cultural events, trade shows, concerts, festivals exhibition, or sporting activities.

What are the aid intensities?

  • 30% of the qualifying expenditure for undertakings that qualify as “Small”;

  • 20% of the qualifying expenditure for undertakings that qualify as “Medium”;

  • 15% in respect of initial investment by “Small” and “Medium” entities  engaged in the development of hotels, guest houses, and their amenities as licensed by the MTA;

  • 10% of the qualifying expenditure  for undertakings that qualify as “Large”

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