Malta’s Commissioner for Revenue published an updated version of the Notional Interest Deduction (NID) Guidelines on 7 November 2019. The update concerns the attribution of the deemed interest income on alternative bases and includes the following:
Where a shareholder is the only shareholder of a company that holds no more than 0.2% of the nominal value of the risk capital of such company and, in accordance with the Memorandum and Articles of Association, such holding is devoid of any rights to vote, to receive any dividends from the company and to participate in the profits of the company, no deemed interest income shall be attributable to such shareholder, and the share of the deemed interest income that would have been attributable to such shareholder were it not for this paragraph (xii) shall be attributable to the other shareholders of the company in proportion to the nominal value of the risk capital of the company pertaining to each shareholder.
In order to apply the above, a request in writing must be made to the Commissioner for Revenue, and the second paragraph of (iv) of these Guidelines shall apply.