Can I Claim Motor Vehicles as a Business Expense in Malta?
Partially. Motor vehicles qualify for a 20% a year wear and tear allowance over 5 years, but only for business use, and private use creates a taxable benefit.
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What Malta Tax and Customs Administration (MTCA) says
Motor vehicles receive wear and tear allowances over 5 years, which is 20% a year, straight-line under S.L. 123.01. The expense must pass the wholly and exclusively test in article 14 of the Income Tax Act. Private expenses are disallowed under article 26, and company cars given to employees are taxable fringe benefits. Confirm asset-specific treatment with MTCA or a licensed practitioner.
When you can claim
- Vehicles used wholly for the business
- The business share of a mixed-use vehicle, apportioned
- 20% a year over 5 years
- Commercial vehicles with documented business use
When you cannot claim
- The private share of a vehicle
- Costs with no record of business use
- Vehicles used personally by the owner with no benefit treatment
- Fuel and running costs for private trips
Good to know
Pro tip: Keep a log of business and private use, because it supports both the deduction and the fringe benefit calculation.
Related expenses
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