Income Tax

Income Tax is levied under the Income Tax Act (Law Number 25/2019). The act was published in the Government Gazette on 17 December 2019 and taxation under the act is set to commence on 1 January 2020. However, remuneration will come within the purview of income effective 1 April 2020. The Business Profit Tax regime imposed under the Business Profit Tax Act would be repealed with the commencement of Income Tax.

Tax residents of Maldives are taxed on their worldwide income, whereas non-residents are taxed on the income derived from Maldives.


Tax Rates

Individuals

Tax bracket ( taxable income per tax year) Tax rate
Not exceeding MVR 720,000 0%
More than MVR 720,000 but not exceeding MVR 1,200,000 5.5%
More than MVR 1,200,000 but not exceeding MVR 1,800,000 8%
More than MVR 1,800,000 but not exceeding MVR 2,400,000 12%
More than MVR 2,400,000 15%

Employee withholding tax

Tax bracket (Remuneration subject to employee withholding tax per month) Tax rate
Not exceeding MVR 60,000 0%
More than MVR 60,000 but not exceeding MVR 100,000 5.5%
More than MVR 100,000 but not exceeding MVR 150,000 8%
More than MVR 150,000 but not exceeding MVR 200,000 12%
More than MVR 200,000 15%

Non-resident withholding tax

Type of income received by the non-resident Tax rate
Income specified in the section 55(a) of the Income Tax Act 10%
Reinsurance premium 3%

Persons other than individuals and banks

Tax bracket ( taxable income per tax year) Tax rate
Not exceeding MVR 500,000 0%
More than MVR 500,000 15%

Banks

25% of the taxable income per tax year


Income derived, from Maldives, by non-resident international transport operators

2% of the gross amount of income (specified in section 11(r) of the Income Tax Act) in a tax year

Announcements

There are no items at this time.

View all

Tax Rulings

There are no items at this time.

View all

Flyers and brochures

FAQ

1 - When did the Income tax Act become effective?

The Income Tax Bill was signed into a law by the President on 17 December 2019. The taxation under the Act started on 1 January 2020. However, taxation of remuneration under the Act would start on 1 April 2020.

 

2 - Who are the persons affected by the Income Tax Act?

Residents of Maldives, and persons who are not residents or temporary residents but derives income from Maldives come within the purview of the Income tax Act.

 

3 - What are the tax rates applicable to an individual under the Income Tax Act?

Income Tax is charged on the taxable income of an individual as per the table below. 

Tax brackets for taxable income derived in an accounting period Tax Rate
Not exceeding MVR 720,000/-  0%
More than MVR 720,000/- but not exceeding MVR 1,200,000/-  5.5%
More than MVR 1,200,000/- but not exceeding MVR 1,800,000/-  8%
More than MVR 1,800,000/- but not exceeding MVR 2,400,000/-  12%
More than MVR 2,400,000/-  15%

 

4 - What is employee withholding tax?

The amount of tax deducted by an employer or payer from the remuneration payable to an employee, director of a company or partner of a partnership is referred to as the employee withholding tax.

 

5 - When does the employee withholding tax commence?

Since taxation of remuneration is due to commence on 1 April 2020, employee withholding tax will also commence on 1 April 2020.

 

6 - How is the employee withholding tax different from the Income Tax?

Employee withholding is a mechanism where the tax due on remuneration is deducted by the payer, before the remuneration reaches the employee, director or partner. Individuals would not double pay the amount of tax that had been already paid on remuneration through the withholding mechanism. Effectively there is no difference between employee withholding tax and Income Tax, except that an amount of tax on remuneration (income) is paid through the withholding mechanism in the case of employee withholding tax.

 

7 - What are the employee withholding tax rates under the Income tax Act?
Remuneration subject to withholding tax (per month)
 [Tax brackets]
 
Tax Rate
Not exceeding MVR 60,000  0%
More than MVR 60,000 but not exceeding MVR 100,000  5.5%
More than MVR 100,000 but not exceeding MVR 150,000  8%
More than MVR 150,000 but not exceeding MVR 200,000  12%
More than MVR 200,000  15%

 

8 - How is "remuneration" defined?

Remuneration includes salary, wages, allowances and benefits derived by an employee or director or partner as consideration for services rendered by the employee or director or partner. It also includes any compensation for loss of employment or service, restrictive covenant payment, and entry or exit inducement payment. Benefits include any fringe benefits, both cash and non-cash.

 

9 - How is remuneration subject to [employee] withholding tax calculated?

Remuneration subject to withholding tax is the amount of remuneration per month, after the deduction of the amount contributed to the Maldives Retirement Pension Scheme by the recipient of the remuneration.

10 - I had been registered as a taxpayer with MIRA even before the Income Tax commenced. Am I required to register again under the Income Tax Act?

If your registration as a taxpayer with MIRA was valid as of 1 January 2020, you are not required to apply for registration under the Income Tax Act. However, in that case, MIRA would register you under the Income Tax Act based on the information it has and notify you of your registration.

 

11 - Are companies, partnerships, cooperative societies required to be registered under the Income Tax Act?

Yes, companies, partnerships or cooperative societies are required to be registered under the Income Tax Act. However, the process is arranged in such a way that companies, partnerships or cooperative societies that are incorporated in the Maldives get registered under the Income Tax Act during the business registration process with the Ministry of Economic Development (MED), and therefore a separate form is not required to be submitted to MIRA for registration.

 

12 - I am an individual doing business in the Maldives, and my business is registered with MED as a sole proprietorship. Am I required to be registered under the Income Tax Act?

Yes, individuals carrying on business through a sole proprietorship are also required to register under the Income Tax Act. However, like corporate entities, such individuals are not required to submit a separate form to MIRA for registration, as it is done during the business registration process with the MED.

 

13 - If a foreign national stays in the Maldives for more than a half year, would that individual be considered as a resident for the purpose of the Income Tax?

If a foreign national stays legally in the Maldives for 183 days or more, and is not married to a citizen of the Maldives, that individual would be considered as a temporary resident for the purpose of the Income Tax.

14 - How does the taxation of a resident differ from that of a temporary resident?

The main difference is that, a resident would be taxed on income derived from both the Maldives and elsewhere, while a temporary resident would be taxed only on income derived from the Maldives.

 

15 - Who is a non-resident?

A non-resident is a person who is neither a resident nor a temporary resident.

 

16 - Temporary residents and non-residents are taxed only on the income derived from the Maldives. How does one differ from the other?

Persons carrying on business in the Maldives are required to deduct non-resident withholding tax from certain payments made to a non-resident, while this requirement is not there when a payment is made to a temporary resident.

 

Charitable Organizations approved by the Commissioner General

A body or association that wishes to be listed as a charitable organization approved by the Commissioner General must submit MIRA 103 form, in accordance with the chapter 6 of the Income Tax Regulation.

List of the Charitable Organizations approved by the Commissioner General

Association Name Registration No Valid From Valid To
1 - Jamiyyathul Ulaama RGS/NGO/2019/31 31 Dec 19 30 Jun 20
2 - Dhivehi Raajjeyge Israhvehinge Jamiyya RGS/NGO/2019/29 31 Dec 19 30 Jun 20
3 - Architects Association Maldives RGS/NGO/2019/30 31 Dec 19 30 Jun 20
4 - Tennis Association of Maldives RGS/NGO/2019/28 30 Dec 19 30 Jun 20
5 - Women in Tech Maldives RGS/NGO/2019/27 11 Dec 19 30 Jun 20
6 - Navaranna Foundation MIRA103/2019/20 08 Dec 19 30 Jun 20
7 - Football Association of Maldives MIRA103/2019/19 01 Dec 19 30 Jun 20
8 - Save the Beach Maldives MIRA103/2019/18 12 Nov 19 30 Jun 20
9 - Benefit MIRA103/2019/15 14 Oct 19 30 Jun 20
10 - Fonadhoo Zuvaanunge Rooh MIRA103/2019/16 14 Oct 19 30 Jun 20
11 - Dhivehi Sifainge Club MIRA103/2019/14 14 Oct 19 30 Jun 20
12 - Hemophilia Society of Maldives MIRA103/2019/17 14 Oct 19 30 Jun 20
13 - Maldives Family Foundation MIRA103/2019/13 03 Oct 19 30 Jun 20
14 - Baa Goidhoo Sports and Youth Development Society MIRA103/2019/12 04 Aug 19 30 Jun 20
15 - Watercare RGS/NGO/2019/11 10 Jul 19 30 Jun 20
16 - Music House MIRA103/2019/10 09 Jul 19 30 Jun 20
17 - Public Interest Law Centre RGS/NGO/2019/09 23 Jun 19 30 Jun 20
18 - Junior Chamber International Addu (Maldives) MIRA103/2019/07 29 Apr 19 30 Jun 20
19 - Naifaru Juvenile MIRA103/2019/08 29 Apr 19 30 Jun 20
20 - SME and Entrepreneurs Federation of Maldives (SEFM) RGS/NGO/2019/06 24 Mar 19 30 Jun 20
21 - Club Mugoo Sports MIRA103/2019/04 04 Mar 19 30 Jun 20
22 - Association of Lady Entrepreneurs MIRA103/2019/05 04 Mar 19 30 Jun 20
23 - Maldivian Network for Empowering Women MIRA103/2019/03 14 Feb 19 30 Jun 20
24 - LFC Supporters Club of Maldives MIRA103/2019/02 05 Feb 19 30 Jun 20
25 - Falcon Youth & Recreation MIRA103/2019/01 06 Jan 19 30 Jun 20
26 - Maldives Association of Human Resource Professionals MIRA103/2018/15 09 Aug 18 30 Jun 20
27 - Small Island Geographic Society MIRA103/2018/12 04 Jul 18 30 Jun 20
28 - International Center for Environment, Development and Operational Research (ENDEVOR)- Maldives MIRA103/2018/06 07 Jun 18 30 Jun 20
29 - Decagan Sports MIRA103/2018/10 04 Jun 18 30 Jun 20
30 - Customs Recreation Club MIRA103/2018/08 03 May 18 30 Jun 20
31 - Hulhudhuffaaru Zuvaanunge Rooh MIRA103/2018/03 13 Feb 18 30 Jun 20
32 - Family Legal Clinic MIRA103/2018/02 12 Feb 18 30 Jun 20
33 - Bicycle Association of Maldives RGS/NGO/2017/46 04 Dec 17 30 Jun 20
34 - Maldives Computer Society MIRA103/2017/26 21 Nov 17 30 Jun 20
35 - Jamiyyathul Islam MIRA103/2017/24 12 Oct 17 30 Jun 20
36 - Zurash Foundation MIRA103/2017/18 17 Aug 17 30 Jun 20
37 - Maishan Sports and Recreation MIRA103/2017/13 29 May 17 30 Jun 20
38 - Male' Sports Club MIRA103/2017/10 30 Mar 17 30 Jun 20
39 - Evidence Based Practice Health Champions Maldives RGS/NGO/2016/21 02 Jul 16 30 Jun 20
40 - Kihaadhoo Development Society (Kids) MIRA103/2016/13 17 May 16 30 Jun 20
41 - Hope For Women MIRA103/2016/11 28 Mar 16 30 Jun 20
42 - Foundation of Eydhafushi Youth Linkage (Feyli) MIRA103/2016/08 22 Mar 16 30 Jun 20
43 - Ekuveri Club MIRA103/2016/07 28 Feb 16 30 Jun 20
44 - Foundation For a Better Future MIRA103/2016/02 17 Jan 16 30 Jun 20
45 - Parley Maldives MIRA103/2015/13 26 Nov 15 30 Jun 20
46 - Women on Boards MIRA103/2015/06 05 May 15 30 Jun 20
47 - Island Development & Environmental Awareness Society MIRA103/2014/20 25 Jan 15 30 Jun 20
48 - Faaf Magoodhoo Zuvaanunge Club MIRA103/2014/2 13 Nov 14 30 Jun 20
49 - Mahaldheeb Foundation MIRA103/2014/15 24 Sep 14 30 Jun 20
50 - Jamiyyathul Falaah MIRA103/2013/28 16 Dec 13 30 Jun 20
51 - V.A.M FOUNDATION MIRA103/2013/20 03 Sep 13 30 Jun 20
52 - Coastline Foundation MIRA103/2013/18 20 Jun 13 30 Jun 20
53 - Cancer Society of Maldives MIRA103/2013/15 14 May 13 30 Jun 20
54 - Eco Youth MIRA103/2012/60 16 Dec 12 30 Jun 20
55 - Islamic United Foundation for Asaas Vinavi and Iyaar MIRA103/2012/50 08 Oct 12 30 Jun 20
56 - Transparency Maldives MIRA103/2012/55 08 Oct 12 30 Jun 20
57 - Maldives National Association of Construction Industry (MNACI) MIRA103/2012/50 01 Oct 12 30 Jun 20
58 - Project Hope MIRA103/2012/39 09 May 12 30 Jun 20
59 - Tiny Hearts of Maldives MIRA103/2012/35 09 May 12 30 Jun 20
60 - Society For Health Education MIRA103/2012/31 07 May 12 30 Jun 20
61 - Care Society MIRA103/2012/07 07 May 12 30 Jun 20
62 - Maldivian Red Crescent MIRA103/2012/15 07 May 12 30 Jun 20
63 - Muslimunge Gulhun MIRA103/2012/05 07 May 12 30 Jun 20
64 - Sun Siyam Care MIRA103/2012/12 07 May 12 30 Jun 20
65 - Villa Foundation MIRA103/2012/11 07 May 12 30 Jun 20
66 - Maldives Autism Association MIRA103/2012/08 18 Apr 12 30 Jun 20
67 - Advocating the Rights of Children (ARC) MIRA103/2012/04 05 Apr 12 30 Jun 20
68 - Aged Care Maldives MIRA103/2012/13 05 Apr 12 30 Jun 20
69 - Maldives Girl Guide Association MIRA103/2012/01 05 Apr 12 30 Jun 20
70 - Alifulhu Thuthu Foundation MIRA103/2012/17 05 Apr 12 30 Jun 20
71 - Diabtetes Society of Maldives MIRA103/2012/19 05 Apr 12 30 Jun 20
72 - Islaamee Eheetherikamuge Gulhun MIRA103/2012/02 05 Apr 12 30 Jun 20
73 - Journey MIRA103/2012/20 05 Apr 12 30 Jun 20
74 - Jamiyyath Salaf MIRA103/2012/26 26 Mar 12 30 Jun 20