I. Analysis of the Core Provisions of the Agreement

Dividend Withholding Tax:

• When shareholding ≥ 25%, the tax rate is reduced from 10% to 5%;
• A Hong Kong investment company holds a 30% stake in a Maldivian hotel group, saving USD 400,000 in dividend withholding tax annually.

Interest and Royalty Fees:

• The tax rate remains at 10%, but tax credits are available. A Hong Kong bank lent to a Maldivian infrastructure project and reduced double taxation by USD 150,000 through the credit mechanism.

Capital Gains Tax:

• When transferring shares of a Maldivian listed company, if more than 50% of the share value comes from local real estate, tax must be paid in the Maldives, but Hong Kong enterprises can apply for a deduction of taxes paid overseas.

Shipping and Aviation Preferences:

• Hong Kong airlines operating routes to the Maldives only need to pay profits tax at the Hong Kong tax rate (16.5%), saving HKD 2 million in taxes compared to before;
• Profits of Hong Kong shipping enterprises in the Maldives are eligible for a 50% tax reduction.

II. Applicable Industries and Investment Opportunities

Tourism Industry:

• The Maldives plans to build 50 new resorts between 2025 and 2030. Hong Kong enterprises can invest by establishing Special Purpose Vehicles (SPVs) and use the agreement to reduce tax costs. A Hong Kong tourism group adjusted its investment structure accordingly, expecting to save HKD 8 million in taxes.

Infrastructure Sector:

• Projects such as the expansion of Maldivian airports and the upgrading of ports have attracted foreign investment. Hong Kong construction companies apply for credits through the "e-Tax" platform, reducing the effective tax burden from 25% to 18%.

Digital Economy:

• The Maldives has launched a "Digital Nomad Visa". Hong Kong technology enterprises can set up R&D centers locally to enjoy the preferential terms of the agreement. A Hong Kong blockchain company has thus transferred part of its business to the Maldives, reducing the overall tax burden by 12%.

III. Compliance Operation Guide

Beneficial Owner Identification:

• It is necessary to prove that the Hong Kong company is the "beneficial owner" of dividends and interest, for example, through evidence such as the actual management body being in Hong Kong and employees working in Hong Kong. A Hong Kong holding company failed to enjoy dividend preferences because it could not prove its identity as the beneficial owner.

Tax Declaration Process:

• The "Application Form for Avoidance of Double Taxation Agreement" must be submitted in Hong Kong, along with the Maldivian tax resident identity certificate;
• It is recommended to handle the process through professional institutions (such as Shengsen International Business) to ensure complete materials, which shortens the average approval time to 2 months.

Dispute Resolution Mechanism:

• In case of tax disputes, they can be resolved through negotiation between the tax authorities of the two places or submitted to arbitration. A Hong Kong enterprise recovered a loss of USD 500,000 within 3 months through negotiation after the Maldivian tax authority misjudged the dividend tax rate.

IV. Future Cooperation and Risk Tips

Potential Policy Expansion:

Compliance Risks: