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Hiring in Maldives

Hiring employees compliantly in Maldives means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Maldives so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Maldives; or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Need assistance hiring in Maldives? Contact us about our International EOR  Service

Labor Laws in Maldives

Employee Probation Period

  • The maximum duration of probation period is three (3) months.

Annual Leave in Maldives

  • After working for one year for your company, employees should get 30 days of paid annual leave
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Holidays in Maldives

New Year’s Day 1st January
First day of Ramadan  
Labor Day 1st May
Eid al-Fitr  
Independence Day (of Maldives) 26th July
Hajj  
Eid al-Adha  
Islamic New Year  
Qaumee Dhuvas  
Prophet's Birthday  
Victory Day 3rd November
Republic Day (in Maldives) 11th November
The Day Maldives Embraced Islam  

 

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Maternity Leave Maldives

  • Female employees are entitled to 6 months of paid maternity leave.

Paternity Leave Maldives

  • Male employees are entitled to 1 month of paid paternity leave.

Sick Leave in Maldives

  • The employer is required to grant thirty days of paid sick leave to the employee during every year of employment

Working Hours in Maldives

  • The standard work week in Maldives is 48 hours per week or eight hours a day, Sundays to Thursdays.

Overtime in Maldives

  • An employee working overtime shall be paid 1 ¼ times his hourly working wage as over time, and if working overtime on a Friday or a public holiday shall be paid 1 ½ times his hourly working wage as over time.

Termination of Employment in Maldives

Employment agreements of indefinite term shall only be terminated after giving the minimum notice specified below:

  • two weeks’ notice for any person in employment for more than six months but less than one year;
  • one month's notice for any person in employment for more than one year but less than five years;
  • two months’ notice for any person in employment for more than five years.
  • Employment can be terminated without notice provided that the employee's wages and other benefits for the required notice period (from the date of commencement of the notice period to the date of termination of the notice period) has been paid in lieu of notice.

Notice Period in Maldives

  • Employment agreements of indefinite term shall only be terminated after giving the minimum notice specified below: ‐
    • two weeks’ notice for any person in employment for more than six months but less than one year;
    • one month's notice for any person in employment for more than one year but less than five years;
    • two months’ notice for any person in employment for more than five years.

Maldives Salary and Wages

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13th / 14th Month Salary in Maldives

  • No
  • There is no statutory requirement to pay the 13th or the 14th month salary.
  • However there is some evidence that it is a statutory requirement to pay the 'Ramazan bonus'.
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Income Tax in Maldives

  • A tax resident in Maldives is subject to income tax on worldwide income. 
  • A non-resident and a temporary resident is taxable in respect of income that is derived from Maldives.
  • An individual (resident, non-resident, and temporary resident shall be taxed on one’s taxable income at the following rates:

Tax bracket (taxable income per tax year) (MVR)

Tax rate (%)

Not exceeding 720,000

0

More than 720,000 but not exceeding 1,200,000

5.5

More than 1,200,000 but not exceeding 1,800,000

8

More than 1,800,000 but not exceeding 2,400,000

12

More than 2,400,000

15

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Social Security in Maldives

  • In accordance with Section 12 of the Pension Act, it is obligatory upon the employer and the employees who have not attained the age of pension to participate in the Retirement Pension Scheme of the Maldives. 
  • The employment contract shall provide for deduction of pension contribution by the employees.
  • The participation in the Retirement Pension Scheme by a Maldivian employee employed in the Maldives is mandatory irrespective of his/her participation in other pension scheme in or outside Maldives. 
  • However, participation by a foreign employee is, at present, voluntary.
  • Every person who is considered a participant of the Retirement Pension Scheme of the Maldives shall pay a minimum of 7% of the employee’s pensionable wage, and the employer shall also pay a minimum of 7% of the pensionable wage to the scheme.

Contribution

Group 1083

Pension Scheme

Employee Group 1083 7%
Employer Group 1083 7%

Immigration Maldives

  • Visitors of all nationalities are eligible for a free, 30-day tourist visa in the Maldives. 
  • There’s a possibility to extend the visa by 60 days as long as your employee is in a suitable financial situation to remain the full 90 days.
  • Although a tourist visa allows foreigners to enter the country, it does not permit work. 
  • Foreigners going to the Maldives for employment are required to obtain a work permit from the employer. 
  • Work permits are issued by Maldives Immigration, which requires that employers deposit a sum of money as a work permit deposit for each employee. 
  • A monthly visa fee of MVR250 applies for foreign workers. 
  • Business visas also can be obtained from a Maldivian sponsor for a maximum of 90 days.
Need assistance hiring in Maldives? Contact us about our International EOR  Service

Type of Visa/Permit

Documentation

Validity

Eligibility

Tourist Visa
  • Valid Passport
  • Passport size photographs
  • Completed application form
  • Return ticket
90 days

  • Foreigners seeking to visit Maldives for tourism purposes must obtain a tourist visa
Business Visa
  • Valid passport
  • Passport size photographs
  • Completed application form
  • Return ticket
  • Invitation letter
90 days

  • Foreigners seeking to visit Maldives for business purposes must obtain a business visa
Work Permit
  • Passport of the employee
  • Copy of the Employment Approval
  • Passport size photo
  • Medical health screening report of the employee issued from a Hospital/Clinic authorized by the relevant government authority
  • Work Visa submission receipt (IM29)
  • A machine readable (MRZ) Passport Bio-data page copy of the applicant
  • Completed Disembarkation / Embarkation Card approved by Maldives Immigration
  • Yellow Fever Vaccination Certificate, if applicable
1 year

  • Foreigners seeking employment in Maldives must obtain a work permit
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Value Added Tax (VAT) in Maldives

  • The supply of goods and services in Maldives is subject to a tax (GST) at the rate of 6% on the value of goods and services. 
  • The supply of tourism goods and services is subject to 12% tax on the value of goods and services.

GST

Higher Rate

Group 1083

12%

Standard Rate Group 1083 6%
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Mandatory Benefits in Maldives

  • These are mandatory benefits as postulated by law
  • These include probationary period, annual leave, public holidays, sick leave, maternity leave, paternity leave, overtime pay, notice period, and severance pay
  • Statutory benefits also include social security benefits
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Mandatory Benefits overview

  • Probationary period

  • Annual Leave

  • Public Holidays

  • Maternity Leave

  • Paternity Leave

  • Sick Leave

  • Overtime Pay

  • Notice Period

  • Severance Pay

  • Social Security Benefits

Payments And Invoicing

  • The taxable period is from 1 January to 31 December of the Gregorian calendar year.
  • All persons are required to file their income tax returns and make payments in the following manner:
    • First interim payment: 31 July of the tax year.
    • Second interim payment: 31 January of the immediately following tax year.
    • Final payment: 30 June of the immediately following tax year.
  • The first and second interim payments are 50% of the previous year’s tax liability.
  • However, the Income Tax Act allows taxpayers to make an estimate of current year tax liability and make interim payments based on that estimate.
  • However, the final tax liability should not be more than 20% of total estimate of interim payments.
  • Employees can make an annual declaration of their income and claim any additional deductions, other than pension contribution.
  • If an employee derives income solely from one employer, he/she is not required to file an annual tax return or interim payment.
  • A person is not required to file a tax return in the following cases:
    • Total income is less than the amount specified in the regulation.
    • Total income is derived solely from one employer.

Payroll Accrual in Maldives

Payroll Accruals Additional Information

 

 

Employment Accruals

Annual Leave After working for one year for your company, employees should get 30 days of paid annual leave This equals 8.22% (30/365 days) of annual income

Maternity Leave Female employees are entitled to 6 months of paid maternity leave.  This equals 50% (6/12 months) of annual income

Paternity Leave Male employees are entitled to 1 month of paid paternity leave.  This equals 8.33% (1/12 months) of annual income

Sick Leave The employer is required to grant thirty days of paid sick leave to the employee during every year of employment This equals 8.22% (30/365 days) of annual income

Overtime An employee working overtime shall be paid 1 ¼ times his hourly working wage as over time, and if working overtime on a Friday or a public holiday shall be paid 1 ½ times his hourly working wage as over time.  Depends on the number of overtime hours worked
Social Security Every person who is considered a participant of the Retirement Pension Scheme of the Maldives shall pay a minimum of 7% of the employee’s pensionable wage, and the employer shall also pay a minimum of 7% of the pensionable wage to the scheme. This equals 7% of annual income
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Accrued Benefits in Maldives

Christmas Bonus % 0%
Christmas Bonus Over Vacations % 0%
Severance per Year%

Employees are entitled to severance pay that equals to 3 months of salary (25% of annual salary)

25% of annual salary
Vacations %

Employees are entitled to an annual holiday of 30 days (8.24% of annual salary)

8.24% of annual salary
Notice %

Employees are entitled to 30 days of notice period for one year of service or more (8.24%)

8.24%
Christmas Bonus Over Notifications % 0%
Vacations Plus %

Based on 1/3 of monthly salary (Ramadan Bonus)

2.77%

Total percentage of Salary (yearly)

The total employment accruals as a percentage of salary per anum are equal to 44.34%

44.34%

Why use Global Expansion to hire in Maldives

Establishing a branch office or subsidiary in Maldives can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Maldives labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Maldives law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Maldives. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Maldives Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.

 

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