Tax Advantages of Mauritius

Overview of the Mauritius Tax System

Mauritius has built its reputation as an international financial centre largely on the strength of its competitive tax regime. The tax system is designed to attract foreign investment while maintaining compliance with international standards. Key features include a flat corporate tax rate with generous exemptions, no capital gains tax, no inheritance tax, free repatriation of profits, and an extensive network of double taxation agreements.

The Mauritius tax framework is governed by the Income Tax Act 1995, administered by the Mauritius Revenue Authority (MRA), and supervised by the Financial Services Commission (FSC) for international business entities. The system is transparent, well-documented, and regularly updated to reflect international developments.

Corporate Taxation

Standard Rate

The standard corporate income tax rate in Mauritius is 15%. This applies to all companies, including domestic companies and Global Business Companies (GBCs). However, the effective rate for GBCs is significantly lower due to the partial exemption regime.

Partial Exemption Regime

The partial exemption regime is the cornerstone of Mauritius's tax competitiveness for international business. Under this regime, GBCs are entitled to an 80% exemption on specified income, including:

• Foreign-sourced dividends
• Interest income from foreign sources
• Profits from international trading activities
• Income from ship and aircraft leasing
• Income from reinsurance of foreign risks
• Fees from the provision of international financial services

This 80% exemption reduces the effective corporate tax rate from 15% to 3% on qualifying income. The partial exemption is applied automatically — no prior approval is required — as long as the company holds a valid GBC license and meets the substance requirements imposed by the FSC.

Tax Incentives for Specific Sectors

No Capital Gains Tax

Mauritius does not levy capital gains tax on the disposal of assets. This applies to all types of assets: shares, bonds, real estate, intellectual property, and any other investment. This is a significant advantage for holding companies, investment funds, and private equity vehicles that generate returns primarily through capital appreciation.

For investors selling shares in African or Asian companies through a Mauritius holding company, the absence of capital gains tax means that the full gain is retained (subject only to any withholding tax in the source country, which is typically reduced under the applicable DTA).

Double Taxation Agreements

Mauritius has signed 45+ double taxation agreements with countries across Africa, Asia, Europe, and the Middle East. These agreements typically reduce or eliminate withholding taxes on dividends, interest, and royalties flowing between treaty partner countries and Mauritius. They also prevent double taxation by providing tax credits for taxes paid abroad.

Key treaty partners include India, China, South Africa, the United Kingdom, France, Germany, Singapore, Malaysia, UAE, Luxembourg, and 16 African countries. For a detailed analysis of specific treaties, see our DTA guide.

Typical DTA Benefits

Personal Taxation

For individuals residing in Mauritius (including expatriates with Occupation Permits), the personal tax regime is equally attractive:

• Income tax — Maximum rate of 15% (with various deductions and exemptions available)
• No capital gains tax — Applies to individuals as well as companies
• No inheritance tax — No estate duty or wealth tax
• No dividend tax — Dividends received by individuals are not taxed
• Free repatriation — No exchange controls; income and capital can be freely transferred abroad
• Territorial taxation — Only income derived from Mauritius or remitted to Mauritius is taxable (for non-domiciled residents)

VAT

Mauritius levies Value Added Tax (VAT) at a standard rate of 15%. However, many financial services, exports, and international business activities are either zero-rated or exempt from VAT. GBCs providing services to non-resident clients are generally not subject to VAT, further enhancing the tax efficiency of the Mauritius platform.

Comparison with Other Jurisdictions

For a detailed comparison, see our jurisdiction comparison page.

Tax Compliance and Transparency

While Mauritius offers attractive tax rates, it maintains high standards of tax compliance and transparency:

• FATCA and CRS — Mauritius has implemented both US FATCA and the OECD Common Reporting Standard for automatic exchange of financial information
• Country-by-Country Reporting — Mauritius has adopted BEPS Action 13 on CbC reporting for multinational enterprises
• Beneficial Ownership — The Beneficial Ownership Act 2017 requires disclosure of ultimate beneficial owners
• Transfer Pricing — Mauritius has transfer pricing rules aligned with the OECD guidelines