If you are self-employed in Malta, there will come a time when you receive a tax assessment notice from the Commissioner for Revenue. For many, this envelope triggers a wave of anxiety. But once you understand what the notice contains and what your options are, it becomes far less intimidating.
This guide walks you through everything you need to know about the tax assessment notice, from what it is to what you can do if you believe it contains errors.
What Is a Tax Assessment Notice?
A tax assessment notice is an official document issued by the Commissioner for Revenue. It confirms the amount of income tax you owe for a particular year of assessment, or it may confirm that a refund is due to you.
The notice is issued after the Commissioner reviews your submitted tax return. In some cases, the assessment matches what you declared. In other cases, the Commissioner may adjust figures based on available information, resulting in a different tax liability than what you expected.
For self-employed individuals, these adjustments can happen for various reasons, including disallowed deductions, unreported income flagged through third-party data, or corrections to social security contribution calculations.
When Do You Receive It?
There is no fixed timeline for when the Commissioner issues an assessment. Some taxpayers receive theirs within a few months of filing. Others may wait a year or longer. In certain cases, assessments can be issued for years that are several years old, especially if the Commissioner believes there has been an underdeclaration of income.
The key takeaway is this: even if you filed your return years ago, you may still receive an assessment that revisits that period. This is why keeping your records organised for at least six years is strongly recommended.
How to Read Your Tax Assessment Notice
The notice will typically include the following:
- Year of assessment — the tax year the notice relates to.
- Chargeable income — the income figure the Commissioner has determined is taxable.
- Tax rate applied — based on your filing status (single, married, or parent).
- Tax charged — the total tax due based on the chargeable income.
- Tax credits — any credits applied, such as provisional tax already paid or tax deducted at source.
- Balance due or refund — the net amount you either owe or are owed.
Take the time to compare each figure against your own records and your submitted tax return. Look at whether the chargeable income matches what you declared, and check that all tax credits you are entitled to have been applied.
Common Discrepancies
Self-employed individuals frequently encounter the following issues:
- Disallowed expenses — the Commissioner may reject certain deductions if they are deemed personal rather than business-related, or if supporting documentation was not provided.
- Additional income inclusions — income from bank interest, rental income, or other sources may be added if the Commissioner has data you did not include.
- Social security adjustments — if your SSC contributions were calculated incorrectly on your return, the assessment may reflect a different figure.
- Incorrect tax credits — provisional tax payments you made may not have been credited properly, or double taxation relief may have been calculated differently.
What to Do If You Disagree
If you believe the assessment is incorrect, you have the right to file an objection. This is a formal process and must be done within strict deadlines.
The deadline to object is 30 days from the date of the assessment notice. Missing this deadline can severely limit your options, so act quickly.
To file an objection, you must submit a written notice to the Commissioner for Revenue stating the grounds on which you disagree. Be specific. Vague objections like "the amount is wrong" are unlikely to be effective. Instead, identify the exact figures you dispute and explain why, referencing your records and documentation.
The Objection Process
Once you file an objection, the Commissioner will review your case. This may involve:
- A request for additional documentation from you.
- A meeting or correspondence to discuss the disputed items.
- A revised assessment if the Commissioner agrees with your position.
If no agreement is reached, the matter can be escalated to the Administrative Review Tribunal. This is a more formal legal process and typically involves professional representation.
It is worth noting that filing an objection does not suspend your obligation to pay the tax assessed. If you owe tax according to the notice, you are generally expected to pay while the objection is being processed. If your objection is successful, any overpayment will be refunded or credited.
Why Clean Records Matter
The best way to handle an assessment notice is to be prepared before it arrives. That means maintaining clear, organised records of all income, expenses, invoices, and receipts throughout the year. When your records are in order, reviewing an assessment takes minutes rather than days, and filing a well-supported objection becomes straightforward.
Self-employed professionals who keep their bookkeeping current and their tax filings accurate are far less likely to face unexpected adjustments. And when discrepancies do arise, they can respond confidently with evidence.
Key Takeaways
- A tax assessment notice confirms your tax liability as determined by the Commissioner.
- Always compare the notice against your own records and filed return.
- You have 30 days to file a written objection if you disagree.
- Be specific in your objection and support it with documentation.
- Keep records for at least six years to protect yourself.
Michael Cutajar, CPA — Founder of Accora.