Issue link: https://maltatoday.uberflip.com/i/424604
maltatoday, SUNDAY, 30 NOVEMBER 2014 4 News MALTA Independent columnist Daphne Caruana Galizia has been called on by the VAT department to pay €101,194 in outstanding Value Added Tax, after a tax audit on her earnings from 2004 to 2012 pro- duced an estimate of €562,191 in un- declared sales from the production of magazines for Standard Publications, among other sources of revenue. According to court documents, the columnist is facing tax assessments on both income and VAT declara- tions. A bank deposits test exhibited in court by the VAT department reg- istered a total of €1,013,883 in de- posits into Caruana Galizia's bank accounts over the past decade, of which €320,000 was drawn up as an estimate by the tax audits section for the years 2004-2007. The VAT department has estimat- ed that the excess deposits excluding VAT amount to €562,191 and is call- ing on the columnist to pay 18% on the sum. No action taken in 2007 According to the court documents, the director of VAT said that be- tween 1999 and 2013, Caruana Gal- izia submitted 13 tax declarations that had missing earnings. In 2007, the department twice in- formed Caruana Galizia to file cor- rect returns and even threatened her with criminal action, although it is not clear what action the depart- ment took. In 2012, the department again wrote to Caruana Galizia demand- ing a €20,762 payment and also in- structed the Tax Compliance Unit to draw an assessment. On 14 March, 2014, the TCU informed her of the estimate for her unpaid VAT and a review was then carried out in April. The TCU's tax audits section drew up a schedule of revenues from what it said was "undeclared employment income" between 2003 and 2004, Taste Cooking School, and bank de- posits between 2008-2013. Under her contract with Standard Publications, Caruana Galizia – who has traded as Proximus Publishing – paid the publishers of the Malta Independent half the net proceeds of advertising revenue for Taste&Flair Magazine, less printing costs. Contesting 'unfair' assessment Caruana Galizia is contesting the estimates, saying they were not drawn up "properly, reasonably or fairly" and that they are based on "an incorrect appreciation of the facts". She has argued that not all depos- its constitute income, they include also money from her husband to pay household bills; transfers from overseas organisers; libel damages; sale of unwanted furniture; gifts; and also return of monies owed to her by family members. She has told the Tribunal of Ad- ministrative Review that the VAT Department has treated all deposits made into her sole bank account as taxable supplies. Caruana Galizia has argued that she has one current account that she uses for both personal and work-related transactions – including revenue for the production of Taste&Flair maga- zine for the Malta Independent, as well as payment for her newspaper columns; and for costs incurred in the production of the magazine. Caruana Galizia protested the as- sessment since she has been unable to assemble documentary proof of the personal and work transactions she carried out over the past 10 years within the three-month period de- manded by the VAT office. "Even if creating and keeping docu- mentary proof of all non-work-relat- ed deposits going back over a decade were mandatory… this would still not address the issue of the bulk of those deposits being a portion of revenue from advertising sold by Standard Publications and transferred to me, as per contract, for the reimburse- ment of third parties involved in the production of the magazines, and for settlement of other production- related costs." Caruana Galizia told to pay €101,000 in unpaid VAT YOUTH GUARANTEE APPLICATIONS (SECOND CALL – EXTENDED DEADLINE) - ESF 3.231 The Youth Guarantee scheme offers young people aged between 16-24 who are not in Education, Employment or Training (NEETs) an opportunity that could make a significant difference in their life. Through this scheme, the Government commits itself to help these participants, find employment. This scheme will offer personalised training in several fields. During the 18-week training period these individuals will undertake various work placements. Training and work programmes are tailor-made. WHERE TO REGISTER Malta: The Ministry for Education and Employment, Great Siege Road, Floriana Level 2 Gozo: Employment and Training Corporation Sir Arturo Mercieca Street, Victoria Registrations are open from Friday 21 November to Friday 5 December 2014, between 8am till 3pm. For more information kindly call 2598 2280 Operational Programme II – Cohesion Policy 2007-2013 Empowering People for More Jobs and a Better Quality of Life Project part-financed by the European Union European Social Fund Co-financing rate: 85% EU Funds; 15% National Funds Investing in your future INCOME TAX ASSESSMENT 2002 Lm25,596 2003 Lm27,783 2004 Lm31,410 2005 Lm36,194 2006 Lm39,613 2007 Lm43,519 2008 €177,385 2009 €140,719 2010 €151,053 2011 €115,858 2012 €85,365 VAT ASSESSMENT Year of Return Undeclared Sales 18% VAT owing 2005 €54,029 €9,725 2006 €55,872 €10,057 2007 €47,002 €8,460 2007 (Sep-Dec) €18,782 €3,381 2008 €78,373 €14,107 2009 €38,860 €6,995 2010 €143,118 €25,761 2011 €59,260 €10,667 2012 €54,867 €9,876 2013 €12,028 €2,165 TOTAL €562,191 €101,194 Daphne Caruana Galizia