Non-resident Withholding Tax (NWT)

This is a mechanism through which non-residents deriving any of the incomes specified in the section 55 of the Income Tax Act from the Maldives are taxed. The obligation to withhold and pay the tax to MIRA is on the person carrying on business in the Maldives [the payer] who makes the payment to the non-resident.

The following table gives types of income subject to NWT and the applicable rates

If the income derived by a non-resident from the Maldives suffers non-resident withholding tax and the income is not a part of the income of the person’s permanent establishment in the Maldives, or if the choice of submitting an income tax return is not open to the non-resident under the Income Tax Act, or if the income is subject to non-resident withholding tax under the “payments to contractor” category even if the income is part of the income of the person’s permanent establishment, the amount of non-resident withholding tax suffered on that income will be the person’s final tax.

The following persons can choose to submit an income tax return even if they do not have a permanent establishment in the Maldives.

1. Persons who derive income from the rent of immovable property situated in the Maldives;

2. Public entertainers who derive income from performing in the Maldives;

3. Persons who derive income from carrying out research and development in the Maldives.

A permanent establishment’s income sourced from the Maldives and subject to non-resident withholding tax under the non-resident contractor category will become the permanent establishment’s final tax in respect of that income.  

• State offices are not required to deduct NWT. However, any income received by a non-resident from a service rendered under a contract to a State office is considered an income derived from the Maldives comes within the purview of the Income Tax Act
• NWT is not required to be deducted from the payments mandated under the National Social Health Insurance Act to carry out the social protection schemes and programs.
• NWT is also not required to be deducted from income made exempt under Section 12 of the Income Tax Act.

NWT Return (MIRA 602) must be filed, and the corresponding payment must be made, by the 15th of the month following the month in which the payment subject to NWT was made to the non-resident. You are not required to submit any additional documents when filing the NWT return. However, you must keep all records. Even if an income which have been made exempt from non-resident withholding tax or deduction of non-resident withholding tax under a treaty or agreement entered into under Section 12(h) of the Income Tax Act, an NWT return must be filed. However, in such cases there would be no corresponding NWT payment. NWT returns can only be filed online using MIRAconnect. NWT payments can only be made online using MIRAconnect or MRTGS service provided by the banks operating in the Maldives.

Payers whose functional currency is Rufiyaa (MVR) are required to prepare the NWT return in Rufiyaa (MVR) and can opt to make NWT payments in either Rufiyaa (MVR) or United States Dollar (USD). However, payers whose functional currency is a currency other than Rufiyaa (MVR) are required to prepare the NWT return in United States Dollar (USD) and make NWT payments in United States Dollar (USD).

To file the return or make payment please proceed to your MIRAconnect account.

Persons filing the NWT return can obtain withholding tax certificate from their MIRAconnect portal.

Non-residents could request the payer to provide withholding tax certificate. The payer must provide withholding tax certificate before 30^th April of the tax year immediately following the tax year to which the certificate relates.

Where the payer refuses to provide a withholding tax certificate, MIRA will provide the certificate with a request from the non-resident along with the proof of the earlier request to the payer. Non-residents could email such request along with the supporting documents to [email protected].