The Maldives Inland Revenue Authority (MIRA) has introduced the fifth amendment to the Income Tax Regulation, mandating that individuals earning income in foreign currencies submit their income tax payments in US dollars.
This latest amendment clarifies the currency requirements for taxes levied under the Income Tax Act. It specifically states that those whose functional currency is not Maldivian Rufiyaa (MVR) must pay their income tax and interim payments in dollars.
The update also provides detailed guidelines for determining and presenting the currency for tax returns. Moreover, it mandates that non-residents earning foreign currency income must pay withholding tax and capital gains withholding tax in dollars. The provisions regarding withholding tax will take effect on October 31.
This change is expected to streamline tax payments for foreign currency earners and ensure compliance with international financial practices.