On the 8th of August 2017 Amendments were made in relation to the Fringe Benefit Rules. There were a variety of changes which affect a large range of fringe benefits.


The changes were the following:

  1. Private Vehicles

In relation to private vehicle use there are a few notable changes that take affect due to these changes. Importantly as of the amendments, vans have been excluded from the definition of a vehicle for the purpose of Fringe Benefits Rules, and as such the private use of a van will be deemed to have no value for these purposes anymore.

Further when calculating the private use percentage of a vehicle, the percentage of the fringe benefit value taken into consideration in cases when the vehicle value is €16,310 or less, has been reduced from 20% to 0%.

  1. Immovable Property

The process of determining the value of the fringe benefit in relation to immovable property has also been altered. The new amendments state that in the event of immovable property being held by a person under the title of either a perpetual or temporary emphyteusis, the cost of the immovable property will only amount to the price or premium paid in accordance with the deed of emphyteusis. There was a previous requirement to increase the annual ground rent payable by five times that amount, which through these amendments is now removed.

  1. Interest

Benchmark rates of interest on loans granted by a bank are now limited to the rate on the main refinancing operations as applied by the Central Bank of Malta, as prevailing at the end of the previous calendar year. This replaces the old system of applying the central intervention rate. In all other cases the benchmark rate of interest on other loans will now be 6.5% decreased from the previous 8.5%. Further cases where a loan is granted to a shareholder, who holds more than 25% of the ordinary share capital and voting rights of that same company, will result in no fringe benefit.

  1. Others

The new Fringe Benefit Amendments further resulted in some circumstances no longer being considered to constitute any fringe benefits. One of these areas which no longer constitutes fringe benefits is in relation to certain health related costs. These costs included medical examinations, medical care, medicine and treatment. Also areas relating to mental health such as counselling, stress management and drug/alcohol abuse. Reimbursements for the use of mobile phones or facsimile machines will also no longer create any fringe benefits. The above are just a few of the many areas which no longer constitute fringe benefits.


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