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Eco Tax System: Compliance Made Easy for Landlords

Eco Tax System: Compliance Made Easy for Landlords

January 22, 2024

Malta and Gozo Eco Tax System for Short Term Rentals

Owning a rental property in Malta or Gozo, unlocks breathtaking landscapes and warm welcomes for tourists from the world over. But navigating the intricacies of tourist taxes, like the Environmental Contribution (Eco Tax), can feel like scaling Mount Etna of paperwork! That’s where Casa Rooms steps in, your trusted partner and eco tax system, simplifying management and paving the way for stress-free compliance. Leave the nitty-gritty to us, so you can focus on what truly matters – building a thriving rental business.

Understanding the Eco Tax: Investing in a Brighter Future

Unveiling the beauty of Maltese Islands to travellers is a rewarding experience, but ensuring compliance with taxes like the Eco Tax can feel like deciphering ancient runes. Fear not, landlords! This eco tax system serves as your compass, simplifying the process and empowering your rental business.

Here’s what you need to know:

  • Who pays? Every tourist 18 and over, regardless of nationality, contributes €0.50 per night spent on any licensed accommodation, from charming villas to bustling hotels. The cap? A mere €5 per continuous stay, even across Maltese islands.
  • Calculating your contribution: Add up the total nights occupied, subtract nights for under-18s and those exceeding the 10-night threshold, and voila! You’ve got your total chargeable guest nights. Multiply that by €0.50, and you’ve got your contribution amount, ready to be reported and remitted effortlessly with Casa Rooms as your partner.
  • Mechanism: the Eco Tax is charged separately on a clear invoice (not within the room rate) to ensure transparency and avoid being impacted by other charges. Collect and report the contribution as follows:
    • 1st return: 5 months (June 20 – October 31, 2016)
    • 2nd return: 2 months (November 1 – December 31, 2016)
    • From 2017: Quarterly returns, every 3 months

Enjoy a 15% refund on the contribution collected between June 20 and October 31, 2016!

  • Responsibility: It’s your duty as the accommodation provider (licensee or operator) to collect the Eco Tax from guests and submit it to the VAT Department. Keep precise records of guest stays and ages for accurate charging and audits.
  • Payment Guidelines:
  • Notice to Guests:
    • Keep guests informed with a multilingual ‘Notice to Guests‘ providing a summary of the Eco Tax.
    • Display printed copies prominently in notice boards, lifts, reception desks, welcome packs, and other visible areas.
  • Legislation:
    • Stay compliant with the following regulations:
      • L.N. 174 of 2016 – Eco-Contribution Act (Amendment to the Second Schedule) Regulations, 2016
      • L.N. 175 of 2016 – Eco-Contribution Act (Amendment to the Third Schedule) Regulations, 2016

Unveiling the Math

Here’s a breakdown of how to calculate your Eco Tax contribution:

  1. Count those nights: Start by adding up the total number of nights guests stayed in your property during the reporting period.
  2. Under-18s stay free (of Eco Tax): Subtract the nights occupied by guests under 18 years old.
  3. Long stays, capped fees: Subtract nights for guests 18 years or over who stayed for more than 10 nights, as the Eco Tax has a 10-night cap.
  4. The total chargeable nights is the magic number you’ll use for the final calculation.
  5. Multiply and pay: Multiply the total chargeable nights by €0.50 to determine your total Eco Tax contribution.

Example:

Let’s say you had 150 total guest nights during the period, but 20 of those nights were for guests under 18, and 15 nights were for guests staying over 10 nights.

Your calculation would be:

Total chargeable nights = 150 – 20 – 15 = 115

Total contribution payable = 115 x €0.50 = €57.50

Simplify the process with Casa Rooms: We handle these calculations accurately and effortlessly on your behalf, ensuring seamless compliance.

Why Embrace Eco Tax Compliance as a Savvy Landlord

Contributing to the Eco Tax isn’t just a legal obligation; it’s a strategic move that empowers your rental business in several ways. Think of it as your key to unlocking a sustainable future, both for Malta and your property’s success. As your trusted eco tax system, Casa Rooms helps you leverage these advantages:

  • Enhanced Island Appeal: A healthy environment and top-notch infrastructure attract more tourists, potentially increasing your rental income. Think pristine beaches, vibrant public spaces, and eco-friendly activities – all fuelled by the Eco Tax, making Malta an even more irresistible destination.
  • Win Over Eco-Conscious Guests: More and more travellers seek sustainable options, and your commitment to responsible tourism through Eco Tax compliance shines in their eyes. Earn positive reviews and repeat business from guests who appreciate your environmental values.
  • Effortless Remittance and Compliance: We collect the Eco Tax from guests seamlessly and integrate it into your monthly rental income, avoiding paperwork woes. We also provide all necessary information for your quarterly e-ID return, making compliance a breeze.

Casa Rooms: Your Eco Tax Experts

With Casa Rooms as your partner, Eco Tax management becomes a smooth and stress-free experience. We offer a comprehensive solution that empowers you to:

  • Enjoy Accurate Calculations: We meticulously calculate the precise Eco Tax owed based on guest nights, age, and stay duration, ensuring seamless compliance with all regulations. Check out a sample of the monthly reports our accounts team sends to landlords.
  • Gain Transparency through Clear Reporting: You receive detailed reports that break down guest nights, exemptions, and chargeable amounts, leaving no room for ambiguity.
  • Streamlined Eco Tax Collection: We facilitate a seamless process by collecting the Eco Tax directly from guests during their online booking payment. Once the license information is provided and integrated into our system, guests conveniently pay the Eco Tax as part of their stay transaction, ensuring a smooth and efficient remittance process independent of the monthly rental income.
  • Benefit from Tax Compliance Support: Monthly, we equip you with the requisite information for your Eco Tax submission. As part of the process, it is imperative that the owner itself submit this information to CFR VAT on a quarterly basis, ensuring a seamless and efficient compliance procedure.
  • Access Your Tailor-Made Eco Tax Guide: We’ve created a specialized guide just for owners like you. This guide is your go-to resource, providing insights on where to access crucial information from our reports and simplifying the submission and payment of your Eco Tax on accommodation returns.

Unlocking More Than Eco-Peace: Why Choose Casa Rooms?

While effortless Eco Tax management is a cornerstone of our service, it’s just the beginning. At Casa Rooms, we understand that property management is more than just transactions; it’s about crafting exceptional tenant experiences. Whether you’re in Malta, Gozo, or Sicily, our commitment to excellence shines through every step of the onboarding process. Join us on a journey that transcends property management norms and unlocks the potential of seamless transitions, lasting impressions, and thriving tenant satisfaction.

Beyond Eco Tax Experts, We’re Your Journey Partners:

  • Seamless Transitions: We handle tenant onboarding like clockwork, from lease agreements and inspections to welcome amenities and communication, ensuring a smooth start for new tenants and landlords alike.
  • Lasting Impressions: We curate every detail of your property, from stylish interiors to thoughtful amenities, creating a space that leaves a lasting positive impact on your tenants.
  • Thriving Tenant Satisfaction: We prioritize responsive communication, proactive maintenance, and personalized service, fostering trust and exceeding tenant expectations.

Choose Casa Rooms and unlock not just Eco-peace, but a rental journey fueled by excellence, satisfaction, and growth. Focus on what matters most – managing your property and welcoming guests.

Contact Us

Contact us today for a free consultation and discover how Casa Rooms can simplify your property management and Eco Tax compliance, while helping you build a sustainable future for your business and Malta.

Don’t wait, make the smart choice for your rental property – choose Casa Rooms, your Eco Tax experts!

We operate in Malta, Gozo and Sicily. Remember to follow us on Facebook and Instagram to stay up-to-date with our latest blogs and guides.

 

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FAQ:

  1. Do I need to collect the Eco Tax from every guest?

Yes, the Eco Tax applies to all tourists aged 18 and over staying in your property.

  1. What happens if I don’t comply with the Eco Tax regulations?

Non-compliance could lead to fines and penalties. Casa Rooms ensures seamless compliance for your peace of mind.

  1. Can I deduct the Eco Tax from my rental income for tax purposes?

No, the Eco Tax is not deductible from your rental income.

  1. What does Casa Rooms charge for handling the Eco Tax?

Our Eco Tax management service is included in our comprehensive property management package, offering exceptional value.

     5. Who submits the Eco Tax information and payment to the CFR VAT website?

While the responsibility for submitting the tax lies with the landlord, Casa Rooms will provide you with all the necessary and accurate information to enable you to easily complete the submission process independently.

 

 

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About

Our marketing specialist, Thais, brings a wealth of experience from her time at Island Properties, particularly in social media, to our team at Casa Rooms. She now contributes to our growth by producing high-quality text-content related materials.

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