Dhiraagu has urged shareholders to review and update their tax residency information to ensure dividends are processed correctly and to avoid withholding tax being deducted where their Maldivian tax residency cannot be established.
The company issued the reminder in line with requirements under the Income Tax Act, which sets out different tax treatment for dividend payments depending on a shareholder’s tax residency status.
Under Section 55(a)(4) of the Income Tax Act, dividends paid to shareholders who are not tax residents of the Maldives are subject to a 10 percent Non-Resident Withholding Tax.
The requirement also applies in circumstances where Dhiraagu is unable to determine whether a shareholder is a Maldivian tax resident when the dividend is being processed.
In such cases, Section 55(c)(1) of the Act requires the company to deduct the applicable withholding tax from the dividend payment.
Dhiraagu is therefore encouraging shareholders to ensure their information is accurate and up to date before dividends are processed.
Shareholders can review and update their tax residency information through the Maldives Securities Depository’s (MSD) Infinity portal.
Those who prefer to submit their information directly can complete Dhiraagu’s Shareholder Information Form and send it to the company’s investor relations team by email.
The reminder is particularly relevant for shareholders whose residency information may be incomplete or outdated, as Dhiraagu must be able to establish their tax residency status at the time a dividend payment is made.
Dhiraagu is one of the publicly listed companies on the Maldives Stock Exchange and has both individual and institutional shareholders.
The company’s latest notice forms part of the administrative requirements surrounding dividend distributions, ensuring the appropriate tax treatment is applied to shareholders in accordance with the Income Tax Act.
Shareholders who are tax residents of the Maldives are being encouraged to verify that their status is properly reflected in their records, while non-resident shareholders will remain subject to the withholding tax requirements stipulated by law.
