| 21/8/2008 |
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| Court of Appeal - Decisions in Income Tax Cases |
| Case No: 53 |
Decided on 16 September 1963 |
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Tax Residence Of An Interdicted Person Living Abroad. Expenses Incurred In The Curatorship Of Such Person
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The taxpayer in question, a Maltese by birth and nationality, had been interdicted by the Courts on the grounds of prodigality. A curator of his affairs was duly appointed. Later the taxpayer obtained the Court's permission to live abroad.
For tax purposes, the person concerned was considered to be not resident in Malta, and the only deductions granted against his income was an amount of 4% representing administration fees. His curator pointed out that Civil Law vests the residence of interdicted persons in their curators, so that the taxpayer concerned was due to be considered resident in Malta. Furthermore, the expenses incurred in the curatorship were imposed in terms of law, so that these should be deducted from the taxable income.
Both the Board and the Court agreed with the Commissioner and rejected the claims. Residence for tax purposes was a question of fact and not a legal concept which could be affected by considerations concerning interdiction. There was no question that the taxpayer was physically living abroad, and he only came to Malta for occasional visits. As regards the expenses of curatorship, these were not expenses incurred in the production of the interdicted person's income, but only expenses which he had to incur because of his personal status. The outgoings were actually an application of the income after it had arisen.
BSC Case No: 3/63
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