S.L. 123.87 Art. 8Calculation of deduction and tax credit. Cap. 325.

(1) In determining the total income of a company, there shall be allowed a deduction equivalent to the relative allowable wages and tuition expenditure.

(2) When the employee in respect of whom the allowable wages and tuition expenditure was incurred obtains the qualification in question, the company shall, in addition to the deduction referred to in sub-rule (1), be entitled to a tax credit equivalent to a percentage of the said allowable wages and tuition expenditure as shown in Table A of the Schedule, but not exceeding the thresholds laid down in sub-rules (3) and (4): Provided that the tax credit under this sub-rule shall not be due unless -

(a) the company has obtained and delivered to the Corporation the statement referred to in rule 6(2); and

(b) the employee was still a full-time employee of the company on the date of the successful completion of the course in question; and

(c) that date is not later than the date specified in the letter of approval issued by the Corporation in terms of rule 5(3)(e) as the latest date by which the course was to be successfully completed.

(3) Subject to sub-rule (4), the tax credit allowable under sub-rule (2) shall not exceed -

(a) the threshold set out in Table B of the Schedule, if the expenditure is incurred by a small or medium-sized enterprise;

(b) the threshold set out in Table C of the Schedule in any other case.

(4) Where the company in question has benefited from any State aid in respect of expenditure to which the tax credit refers, other than as provided for in this Part, the said threshold shall be reduced by the value of that aid.

(5) The correct calculation of the reduction mentioned in sub-rule (4), where applicable, shall be the sole responsibility of the company.

(6) The deduction referred to sub-rule (1) shall be due for the year of assessment immediately following the year in which the relative expenditure is incurred, and the tax credit referred to in sub-rule (2) shall be due for the year of assessment immediately following the year in which the course of studies in question is successfully completed: Provided that -

(a) to the extent that a deduction or tax credit cannot be availed of in a year of assessment, it shall be carried forward to be availed of in subsequent years of assessment;

(b) a tax credit due under this Part shall not give rise to a right to a refund of tax;

(c) where a company qualifies for a tax credit under the Business Promotion Act and also under the provisions of this Part, it shall avail itself of the tax credit under the Business Promotion Act before any set-off is made in respect of the tax credit due under this Part.

(7) The amount of the total tax credit allowable under this Part shall be subject to the applicable State aid intensity limitations, in particular those established in Article 4 of Commission Regulation

(EC) No 68/2001 on the application of Articles 87 and 88 of the EC Treaty to training aid, as subsequently amended.