MUSCAT – The decision adds a new Article (18 bis) to the regulations, outlining specific requirements that must be met for expense deductions.

Under the amended provisions, deductible expenses must be necessary for conducting business activities and must meet regulatory approval requirements. The deduction will only be permitted when authorised by the Chairman of the Tax Authority, and the expense must not arise from a violation of any legal or regulatory obligation, regardless of its source.

The new article aims to establish clearer guidelines for businesses regarding expenses incurred as a result of decisions or directives issued by government administrative bodies and public entities.

The Tax Authority said the amendments replace any previous provisions that conflict with the new decision.

The decision was published in the Official Gazette on July 20, 2026, and will come into effect from the tax year beginning January 1, 2027.