Tax advantages in Mauritius
Did you know that Mauritius is one of the 10 most tax-attractive destinations in the world? The Organisation for Economic Co-operation and Development (OECD) has ranked the country amongst the most “virtuous” in this regard. Here’s what you need to know about tax benefits in Mauritius:
In the past, foreigners were not allowed to buy real estate property in Mauritius. Now they can do so under specific programs approved by the Mauritian government. They are also eligible for a residence permit when purchasing a property worth more than $500,000 and thus benefit from significant tax benefits.
What tax benefits does Mauritius offer?
➢ No tax on dividends
➢ No tax on capital gains
➢ No inheritance tax for direct descendants
➢ Profits and dividends of companies outside Mauritius can be repatriated without any restrictions, with a tax rate of 15%
➢ Fixed income tax rate of 15%
➢ 15% tax rate for processing activities
➢ Tariff exemption for all goods imported through the free port
Double Taxation Avoidance Agreements
Mauritius has signed double taxation avoidance agreements with some 40 countries around the world. The tax treaty between France and Mauritius, for example, includes the following benefits:
➢ The property purchased by the investor is not included in the IFI’s taxable base in France;
➢ Rental income is taxed on the spot at only 15%, after deducting expenses;
➢ Income is then tax-exempt in France.
How can you benefit from these benefits?
In order to benefit from these tax advantages, the person must first become a tax resident in Mauritius. To do so, one must have a residence permit. The person will then be automatically considered under the Mauritian tax system but will need to spend at least six months per year in the country. These six months may be over one complete stay or accumulated over several stays during the fiscal year.
This tax optimization strategy is an invaluable advantage for the growing number of investors who are coming to Mauritius to develop their business and who are looking for a gateway to Africa, Europe or Asia. To grow your business on Mauritian soil, other criteria are also applicable:
➢ The company’s headquarters must be located in Mauritius
➢ At least two administrators must reside on Mauritian soil
➢ The main bank account or accounting books must be registered in Mauritius
➢ The enterprise must employ at least one Mauritian citizen
➢ The enterprise must invest at least $100,000 in the territory
For more information, please visit the official website of the Economic Development Board (EDB).