Around 130,000 people will be exempted from completing an income tax return this year because, as the result of a newly-introduced system, they will receive a tax statement already completed with the information available to the Inland Revenue Department, said parliamentary secretary within the Finance Ministry Tonio Fenech yesterday.

Mr Fenech explained that this system was an enhanced version of the original scheme that was introduced in 1999, which made use of the declaration form (blue form) and the income tax and self-assessment system (green form).

He explained that certain categories of employees, students and pensioners were among those who would qualify under the new system. They would not be required to fill in their income tax form but would receive a tax statement, including all the information available about the taxpayer at the Inland Revenue Department.

The information that will be automatically included in the statement was on income from employment, local pensions and or British Services pensions.

It would also include income arising from local interest that has not had the final withholding tax of 15 per cent applied, transfers of property that was subject to a final tax, and income arising from dividends paid out by companies on the Malta Stock Exchange.

Furthermore, added Mr Fenech, the department would also include available information regarding school fees to independent private schools and tax at source on dividends paid out by listed companies.

“Through this system, taxpayers will not have to resort to spending money to complete their income tax return, or making use of the department’s services,” he said.

The parliamentary secretary explained that all taxpayers whose income consisted only of employment, pensions and stipends would not receive an income tax return to complete, provided that the Inland Revenue Department already had all the necessary information. Instead, he said, they would simply receive a tax statement.

Mr Fenech said it was also possible that certain taxpayers, even though they qualified under the new system, might still receive an income tax return to fill in.

“If the Inland Revenue Department still lacks complete and accurate information on certain individuals, they will still receive an income tax return. This has to be filled in correctly and sent to the department,” he said.

Mr Fenech stressed the importance of carefully checking that the information on the tax statement was correct.

“If there is any other form of income, such as income from foreign investments for example, that is not included, or if there are any deductions that are needed to be made, then all the taxpayer has to do is complete the bottom part of the tax statement. This form will request the department to issue an income tax return,” he said.

Taxpayers who requested an income tax return must do so immediately and send it to the department by not later than 30 June, he added.

However, said Mr Fenech, if the government discovered that an individual had not informed the Inland Revenue Department of any other forms of income, they would be liable to pay additional tax for late filing and interest may be charged at one per cent per month on any outstanding tax balance that was not paid by the end of June.

He added that if there was any information that was missing from the tax statement, this did not mean that the individual should not declare it.

Certain categories of taxpayers were excluded from the scheme for obvious reasons and would receive an income tax return immediately, he pointed out.

These included people who received income from trade, business or rent. People who had income from capital gains during the year, on which provisional tax was paid, who received foreign pensions, or received income from overseas employment or foreign investments, or who received or paid alimony, would also not be included.

Taxpayers who qualified for fiscal incentives, or who wanted to claim back any tax credit, must also complete and submit the income tax return, added Mr Fenech.

For more information call the Taxpayer Service on freephone 8007-2297 or 2296-2430.