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Since 2020, the Maldives has taken a significant step in modernizing its fiscal framework by introducing an Income Tax Act that expands its tax base to individuals, companies, and foreign residents. Understanding the tax structure is essential for legal compliance and financial planning, whether you’re a local entrepreneur, a salaried employee, or a temporary expat.
Legal Foundation & Timeline
- Law enacted: 17 December 2019
- Effective date: 1 January 2020
- Remuneration taxation started: 1 April 2020
The law applies to:
- Residents of the Maldives
- Temporary residents (e.g., foreigners staying ≥183 days)
- Non-residents earning Maldivian-sourced income
Income Tax Brackets (Annual)
| Income Range (MVR) | Tax Rate |
|---|---|
| Up to 720,000 | 0% |
| 720,001 – 1,200,000 | 5.5% |
| 1,200,001 – 1,800,000 | 8% |
| 1,800,001 – 2,400,000 | 12% |
| Over 2,400,000 | 15% |
Employee Withholding Tax (EWT) – Monthly Remuneration
This applies to wages, salaries, benefits, allowances, and any compensation related to employment or service.
| Monthly Income Range (MVR) | Tax Rate |
|---|---|
| Up to 60,000 | 0% |
| 60,001 – 100,000 | 5.5% |
| 100,001 – 150,000 | 8% |
| 150,001 – 200,000 | 12% |
| Over 200,000 | 15% |
Remuneration is taxed after deducting contributions to the Maldives Retirement Pension Scheme.
Registration & Compliance
- Businesses (companies, partnerships, cooperatives) are auto-registered via the Ministry of Economic Development (MED) during incorporation.
- Sole proprietors are also auto-registered.
- As of 1 Jan 2020, existing MIRA-registered taxpayers were automatically enrolled under the new regime.
Residency & Tax Liability
| Status | Tax Scope |
|---|---|
| Resident | Worldwide income |
| Temporary resident | Maldives-sourced income only |
| Non-resident | Maldives income (subject to withholding) |
Businesses must withhold tax on specific payments to non-residents.
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