EU VAT for Malta businesses, checked on every sale

VAT in Malta: the basics

• The standard VAT rate in Malta is 18%, and some goods and services use reduced rates. Source: Malta Tax and Customs Administration
• Goods sold to a VAT-registered business in another EU country, and shipped there, are generally zero-rated. In Malta this is called 'exempt with credit'. It only applies if the customer's VAT number is valid, and you keep proof that the goods left Malta and report the sale in your recapitulative statement. Source: Malta VAT Act (Cap. 406)
• The European Commission's VIES service confirms whether an EU VAT number is valid. Source: VIES
• Exports outside the EU are generally zero-rated, with proof of export.

This is general information, not tax advice. Check your own situation with your accountant or the Malta Tax and Customs Administration.

How Ambra handles it

• VIES check on the sale. When a quote or order goes to an EU business, Ambra checks the VAT number live in VIES, and stores the consultation number VIES gives back with the check.
• The right VAT on each line. Ambra works out the VAT from the sale itself: the customer's country, where the goods ship from and to, business or consumer, VAT number, goods or services, and proof of export. For example, lines switch from 18% to 0% reverse charge when an EU business customer's VAT number checks out.
• No 0% without a valid check. Ambra only zero-rates an EU business sale after a valid VIES check is on record.
• The wording on the invoice. The invoice shows the VAT treatment and the matching legal wording, such as reverse charge.
• Matches your Xero tax codes. Each line uses the matching Xero tax code, such as EU Sales 0%, Non EU Sales 0% or Sales 18% Malta, and invoices sync to Xero.

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