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 commenced on 1 January 2020. However, remuneration came within the purview of income effective 1 April 2020. The tax regimes imposed under the Business Profit Tax Act and Bank Profit Tax Act were repealed with the commencement of Income Tax.
Residents of the Maldives are taxed on their worldwide income, whereas non-residents and temporary residents are taxed on the income derived from the Maldives only
Tax rates and brackets applicable to individuals are given below. The total tax payable of an individual is calculated by allocating the total taxable income of the individual to the appropriate tax brackets and applying the respective rates.
| Tax bracket 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% |