Maldives Tax Newsletter - February 2025
Welcome to the Maldives Tax Newsletter where you will find highlights from national developments in tax law and policy.
Tax Policy
Maldives Inland Revenue Authority (MIRA) Publishes its Compliance Improvement Plan 2025-2026
On 26 January, MIRA published its Compliance Improvement Plan 2025-2026 which sets out the compliance improvement activities planned for 2025-2026.
The activities planned for 2025-2026 include the following:
Widening the tax base and maintaining an accurate taxpayer registry
Improving on-time filing rate and ensuring completeness of returns filed
Increasing the on-time payment rate and ensuring timely revenue collection
Accurate reporting of tax declarations
Additionally, the plan includes targeted compliance improvement activities for different taxpayer segments such as the following:
Tourist resorts and multinational enterprises (MNEs)
Guesthouses and tourist hotels
Construction and real estate
Wholesale and retail trade
Food service businesses
Transport service providers
Professional service providers
High-net-worth individuals
Tax Cases
Tax Appeal Tribunal Decides a Historic First Income Tax Case: I.R.T.S Private Limited v MIRA [TAT-CA-I/2022/003]
On 22 January, the Tax Appeal Tribunal (“Tribunal”) passed its judgement in I.R.T.S Private Limited v MIRA. The Tribunal rejected the taxpayer’s claim that they were not obliged to make the second interim payment as a result of their first interim payment exceeding the estimated tax payable for tax year 2020. The Tribunal held, inter alia, that the appellant’s obligation to pay their second interim payment remains, and that they had not paid their second interim payment in accordance with the law.
Additionally, the Tribunal highlighted the following:
The facts of the case do not fall within the exempt situations where an interim payment is not required to be made.
It will only be clear whether interim payments have been made in excess after the final tax return has been filed and there is no legal basis to consider the first interim payment as excessive beforehand.
If the taxpayer has paid an excess amount, it will be adjusted upon submission of the final tax return. Any refunds will be granted under the procedure set out in Section 74 of the Tax Administration Act, Section 123(a) of the Income Tax Regulation, and Section 69 of the Tax Administration Regulation.
The taxpayer is subject to non-payment fines under Section 66(b) of the Tax Administration Act for not making the second interim payment.
This marks the first time that the Tax Appeal Tribunal has delivered a judgement in an income tax case since the introduction of the income tax system in 2020.
Star Resort and Hotels Company Private Limited v MIRA [2023/SC-A/09]
On 26 January, the Supreme Court passed its judgement in Star Resort and Hotels Company Private Limited v MIRA.
The High Court had decided the following:
The Goods and Services Regulation (“GST Regulation)” does not state that MIRA-approved methods for determining the open market value for the purposes of Section 25(d) of the GST Regulation must be published.
Relevant laws and regulations do not state that taxpayers are precluded from determining the open market value without a publication of MIRA-approved methods of determining the open market value.
However, the Supreme Court disagreed with the above and the court found that all materials needed for a legally accurate computation of taxes must be published.
Additionally, the court reiterated its position taken in Maldives Passions Private Limited v MIRA [2021/SC-A/112] by stating that the Tax Appeal Tribunal can order MIRA to conduct a reassessment of taxes under Section 42(c)(2) of the Tax Appeal Tribunal’s Regulation.
Conclusion
Thank you for reading this edition of our newsletter. We hope you found the updates valuable. If you have any questions or would like any further information, please do not hesitate to contact us.
Please subscribe to our newsletter to receive tax updates from the Maldives in your inbox every month.
© 2025 Nadha Nazeer. All rights reserved.
