A permanent establishment is a fixed place where a non-resident person wholly or partly carries on a business in the Maldives and includes:

A place of management;
A branch;
An office;
A factory;
A workshop;
A mine, oil or gas well, quarry or any other place of extraction of natural resources, including vessels and ships used for the extraction of such resources; and
If a person acts in the Maldives on behalf of an enterprise and, in doing so, habitually concludes contracts, or habitually plays the principal role leading to the conclusion of contracts that are routinely concluded without material modification by the enterprise, then the enterprise shall be deemed to have a permanent establishment in the Maldives in respect of any activities which the said person undertakes for the enterprise.

The permanent establishment rules are amended by the First Amendment to the Income Tax Act published on 20 July 2021 and includes:

A building site, construction, assembly, or installation project or connected supervisory activities if such site, project, or activities lasts for more than 90 days (reduced from 6 months);
Activities involving exploration, extraction, or exploitation of natural resources, including fishing, if such activities last for more than 90 days;
Activities involving installation or substantial use of mechanical or scientific equipment or machinery if such activities last for more than 90 days; and
Furnishing of services, including consultancy services, by an enterprise through employees or other personnel engaged by the enterprise for such purpose, if such activities continue within the Maldives for a period or periods aggregating more than 183 days in any 12-month period commencing or ending in the tax year concerned.

The term “permanent establishment” shall be deemed not to include:

The use of facilities solely for the purpose of storage or display or delivery of goods or merchandise belonging to the enterprise;
The maintenance of stock of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery;
The maintenance of stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise;
The maintenance of a fixed place of business solely for the purpose of purchasing goods or merchandise or of collecting information, for the enterprise;
The maintenance of a fixed place of business solely for the purpose of carrying on, for the enterprise, any other activity; and
The maintenance of a fixed place of business solely for any combination of activities above, provided the overall activity of the fixed place of business, is of a preparatory or auxiliary character.

Effective 1 January 2020, a force of attraction principle is introduced whereby if a non-resident person conducts business in Maldives through a permanent establishment and in parallel also sells goods or merchandise that are similar in nature to the goods or merchandise sold through such permanent establishment or conducts business activities that are similar in nature to those effected through the permanent establishment, then any income derived from such sale or business activity is attributed to the permanent establishment and is taxable in the Maldives.

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