Business Profit Tax Act (Law Number 5/2011)

BUSINESS PROFIT TAX ACT

(Law Number 5/2011)

 

Section 1 – Introduction and name

1.     Introduction and citation

  • This Act contains provisions for the establishment and implementation of an administrative framework for the purpose of implementing Business Profit Tax in Maldives.
  • This Act shall be cited as the “Business Profit Tax Act”.

 

CHAPTER 1: THE CHARGE TO TAX

2.     Charge to tax on profit from sources outside Maldives

  • This Section applies to any company, not being a partnership, which as respects the tax year in which their accounting period ends satisfies the conditions in Section 2(b).
  • Tax on profits from sources outside Maldives shall be charged provided the following conditions are met:
    • (1) The company is registered under the Companies Act of Maldives (Act Number 10/96) and is not resident outside Maldives;
    • (2) Such company derives income in that period from:
      • any business carried on wholly outside Maldives; or
      • bonds, shares, debentures, loans or any other financial instruments issued or granted by a Person who is not resident in Maldives; or
      • bonds, shares, debentures, loans or any other financial instruments issued or granted by a Person who is resident in Maldives, for the purpose of any capital project carried on outside Maldives; or
      • loans of any nature; or any royalties payable by a Person who is not resident in Maldives; or any immovable property situated outside Maldives; and
      • any immovable property situated outside Maldives; and
    • (3) does not carry on any other business or have any other source of income.

Except as otherwise provided by this Act, tax for the tax year shall be charged in the name of the company on the taxable profits of the company of that year, that is to say, the full amount of its profits of that year, wherever the profits arise and whether

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