Types of Income Tax in Maldives

Income Tax return in Maldives

Maldives Inland Revenue Authority (MIRA) is the responsible body for all sort of income tax in Maldives. The primary responsibility of Maldives Inland Revenue Authority (MIRA) includes – implementation of tax law & policies, providing necessary guidance and advice to the government for determining the tax policies. However, revenue from corporate tax rates is one of the primary sources of income of Maldives government.

Remittance Tax

This is news that a foreign employee does not need to pay any income tax in Maldives. However, migrants who are working in Maldives are charges 3 percent remittance tax for sending money at their home country. There is no need to file an income tax papers for remittance tax. The bank from where you send the money is responsible for handling all the remittance procedure. Note: all the emigrants working in Maldives need to have a bank account, and their salary must be transferred to that account.

The government of Maldives provides a restriction on taking large amount of cash while traveling out of the country. This type pf activity is completely illegal and punishable by law.

Business Profit Tax

This is a type of tax that is charged on profits from almost all business that are carried out in Maldives. Business profit tax is the point toward all the companies, partnership business and even individuals who are residing in the country and performing a business activity. Companies who have a monthly income of 500000 MVR or more are subjected to pay 15 % tax income tax in Maldives. However, companies that are making profits out of the country are charged only 5 % income tax.

Goods and Services Tax- Act

Goods and Service tax come in place of TGST regime. The GST Act has come into effect from 1st October 2011, and all territories of the economy have been taxed. The Act enacted a GST with a rate of 3 percent to 3.5 percent from 1 October 2011 to 31 December 2011 and implemented 6 percent from 1 January 2012 to 31 December 2012. GST rates rose to 8 percent on 1 January 2013 and up to 12 percent on 1 November 2014 on "Tourism and Goods." GST rates at 6 percent on general good and service from 1 January 2012.

Note: All foreign investors have to show Financial Credibility of USD 500,000/- in the home bank to register private limited company, FDI business in Maldives.

Read Also: How to register a company in Maldives

Registration with MIRA

The business establishes in Maldives must register their business with the Ministry of Economic Development. The company also needed to be registered with MIRA and open an income tax file. There is no need for separate form to register with MIRA; the registration will be done together at the time of your company registration.  Once the registration process is over, MIRA will provide you with a TIN.  Besides, you may also require to register for separate tax types such as- green tax, bank profit tax, GST, etc.

Returns and Payments

Returns and Payments

The business profit tax can be paid in 3 payment that is 1st interim payment, 2nd interim payment and final interim payment. According to the policies of MIRA 300 & 304–

  • Interim payment statement must be submitted when you make interim payments
  • You must submit the BPT return while making the final payment.
  • The Business Profits Tax return must need to be accompanied by financial statements.

The deadlines for filing the Statement of Interim Payment

  • 1st Interim Payment: the half of the tax are payable and must be paid within July 31 of the same tax year.
  • 2nd Interim Payment: the half of the tax are payable and must be paid within January 31 of the following tax year.
  • Final Interim Payment: pay the remaining balance by June 30 of the following tax year.

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Frequently Asked Question

Q: What is current GST and TGST rate in Maldives?

  • The current good and service tax is 6% and tourism good and service tax is 12%.

Q: How much is the remittance tax and when did it become effective?

  • The remittance tax is charge at 3% and it became effective from October 2016.

Q: Which form is required to submitted for GST Return for the Tourism industry?

  • MIRA 206 (GST Return)

Q: When it becomes mandatory to register for GST in Maldives?

  • Registration is mandatory if you import good in Maldives, if you provide TGST, if your sale exceed 1 million MVR for last 12 month.

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