Mauritius tax system - taxation of Moorish GBC companies and individuals: VAT, income tax and capital gains. Tax treaties of Mauritus.
Basic taxes (briefly)
|Corporate tax (in detail)||The corporate income tax rate is 15%. Exporting companies pay tax on export income, determined according to the relevant rules, at a rate of 3%.|
|Capital gains tax. Details||Gains from the disposal of assets are not taxed unless recognized as profits from commercial trading activities.|
|VAT. Details||VAT rate is 15%|
|Other taxes||Social contributions, Real estate transfer tax, lease transfer tax, registration fee|
|Stamp duty||25-1.000 MUR|
International tax agreement
|Bangladesh (People's Republic of), Barbados, Belgium, Botswana, Cabo Verde, China, Congo (Republic of), Croatia, Cyprus, Egypt, France, Germany, Guernsey, India, Italy, Kuwait, Lesotho, Luxembourg, Madagascar, Malaysia, Malta, Monaco, Mozambique, Namibia, Nepal, Oman, Pakistan, Qatar, Rwanda, Senegal, Seychelles, Singapore, South Africa, Sri Lanka, Swaziland, Sweden, Thailand, Tunisia, Uganda, United Arab Emirates, United Kingdom, Zambia, Zimbabwe|
|Cape Verde, Gabon, Ghana, Jersey, Kenya, Morocco, Nigeria, Russia|
Tax residents are taxed on their worldwide income, but foreign-source income is only taxed when remitted to Mauritius. Non-residents pay tax on income sourced in Mauritius.
The tax rates are progressive:
- income up to MUR (Mauritian rupee) 650,000 – 10%;
- over MUR 650,000 – 15%.
Income over MUR 3.5 million attracts an additional solidarity levy of 5% on the amount exceeding MUR 3.5 million.
Gains from the sale of assets are tax exempt. However, if an individual conducts active trading, the tax authorities may reclassify the income as trading profit which will then be taxed at regular rates.
Income from the sale of securities is exempt from tax.
Corporate Income Tax
Mauritian tax resident companies pay corporate income tax on their worldwide income and non-resident companies on income sourced in Mauritius.
The corporate income tax rate is 15%.
Exporting companies are taxed at the rate of 3% on their export income which is determined based on a prescribed formula.
Companies qualify for 80% exemption of certain income, including but not limited to foreign dividends, certain interest, income from ship and aircraft leasing, income of licensed asset managers, etc.
Companies must create a corporate social responsibility fund in the amount of 2% of their taxable income and remit at least 75% of this fund to the tax authorities.
Companies conducting business and having their place of central management overseas must be registered as "authorized" with the appropriate regulatory authorities. Such companies are regarded non-residents for tax purposes, but must file a return of income.
Gains from the disposal of assets are exempt from tax unless regarded as profits from trading activities. In particular, gains from the sale of shares held for less than 6 months are classified as trading income and are subject to tax.
Dividends received from Mauritian companies are tax exempt.
Control over a foreign company arises from holding, directly or indirectly, solely or jointly with related parties, more than 50% of shares in the company’s capital.
The CFC rules do not apply if:
- the company’s accounting profit is less than EUR 750,000 and non-trading (passive) income is less than EUR 75,000;
- the company’s accounting profit is less than 10% of the company’s operating costs;
- the corporate income tax rate in the CFC’s country of residence exceeds 50% of the Mauritian tax rate.
The CFC’s non-distributed income is taxed if the tax authorities determine that such income arose from non-genuine arrangements designed to gain improper tax advantages.
No withholding tax applies to dividends.
Interest and royalties are subject to 15% withholding tax.
Withholding tax may also be levied on other payments.
The tax rates can be reduced under the relevant double tax treaties (DTTs).
VAT is charged at the rate of 15%.
Social Security Contributions
Social security contributions are paid by the employee and the employer at rates of 1.5% and 3% respectively on earnings up to MUR 50,000 per month. For earnings over MUR 50,000 per month, contributions are paid at the rate of 3% by the employee and 6% by the employer.
In addition, contributions to the National Savings Fund are payable at the rate of 2.5% by the employer and at the rate of 1% by the employee. There is a maximum remuneration on which this contribution is payable. Employers also pay 1% training levy on the employee’s remuneration.
Land Transfer Tax, Leasehold Tax and Registration Duty
Land transfer tax is levied at the rate of 5%. This tax is also levied on the sale of shares in a company that owns real estate. The tax is payable by the transferor.
When registering a transfer of leasehold rights in state land, tax is levied at the rate of 20% and is payable by the transferor and transferee in equal shares.
A registration duty of 5% is levied on certain other transactions with real estate and with shares in real estate companies.
Stamp duty is levied on various documents in the amount of MUR 25 to MUR 1,000.
International tax treaties
Mauritius has 43 Double Tax Treaties (DTC) and 8 Tax Information Exchange Agreements (TIEA) with the following jurisdictions:
43 DTCs: Bangladesh (People's Republic of), Barbados, Belgium, Botswana, Cabo Verde, China, Congo (Republic of), Croatia, Cyprus, Egypt, France, Germany, Guernsey, India, Italy, Kuwait, Lesotho, Luxembourg, Madagascar, Malaysia, Malta, Monaco, Mozambique, Namibia, Nepal, Oman, Pakistan, Qatar, Rwanda, Senegal, Seychelles, Singapore, South Africa, Sri Lanka, Swaziland, Sweden, Thailand, Tunisia, Uganda, United Arab Emirates, United Kingdom, Zambia, Zimbabwe.
8 TIEAs: Cape Verde, Gabon, Ghana, Jersey, Kenya, Morocco, Nigeria, Russia.
There are generally no restrictions on foreign exchange transactions.
Taxes of Mauritius
|Min. rate for corporate tax||15%|
|Capital gains tax||0%|