Guidelines on the application of 0% VAT rate

Devices and aids to non-profit making organisations

Following the implementation of L.N 12 of 2024, the Commissioner for Tax and Customs, published Guidelines for the application of the 0% VAT rate on devices and aids to non-profit making organisations.

The Guidelines provide clarifications on the specific goods which for the purpose of the exemptions should be considered as “devices and aids, including related goods” to which the exemptions apply. In particular, these include:
  • Technological assistive devices and related goods, falling under CN Codes 85437007 and 42029298 and
  • Devices and related goods falling under CN Codes 90214000, 90219010 and 90219090.
The exact nature of these goods may be verified on the website of the National Statistics Office. 

It is further emphasised that if such devices and aids, including related goods, supplied to non-profit making organisations hence benefiting from the exemption, are subsequently supplied by the non-profit making organisations to persons in need for consideration (being in the form of a donation, contribution, or any other form of payment, whether in cash or in kind), such consideration would be chargeable to VAT at the standard rate of 18%.

Lastly, the Guidelines provide the conditions which need to be satisfied for a non-profit making organisation to be recognised by the Commissioner for Tax and Customs, as follows:
  • It qualifies as a non-profit making organisation in accordance with Item 5, Part Five of the Fifth Schedule to the VAT Act; and
  • It is registered with the Commissioner for Voluntary Organisations as a Voluntary Organisation in term of the Voluntary Organisations Act, Chapter 492 of the Laws of Malta.

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