Fiscal Incentives

  • Low tax rates (0% - 3%).
  • No withholding tax on remittance of branch profits.
  • No withholding tax on interest, royalties and dividends.
  • No capital gains tax.
  • Carry forward of losses limited to 5 years except for losses attributable to annual allowances.
  • Royalties, interest and service fees payable to foreign affiliates are allowable as expenses provided they are reasonable and correspond to actual expenses incurred.
  • No estate duty, inheritance or wealth taxes.
  • No stamp duties, registration duties and levy.
  • Zero rated Value Added Tax for global business transactions.
  • Trusts can elect to be non –resident and be tax-exempt in Mauritius.
  • Trusts can hold GBC1 licences and avail of DTA benefits.

Foreign Tax Credits

  • GBC1 companies are liable to taxes at the rate of 15% but provided that the GBC1 owns at least 5% of an underlying company, credit will be available on foreign tax paid on the income out of which the dividend was paid (‘underlying foreign tax credit’).
  • When a company not resident in Mauritius, which pays a dividend, has itself received a dividend from another company not resident in Mauritius (a ‘secondary dividend’) of which it owns either directly or indirectly at least 5% of the share capital, such dividend will be allowable as foreign tax credit and an underlying foreign tax credit will also be available.
  • Tax sparing credits are available – Under this regime the effective rate of taxation in Mauritius can be reduced, as a long stop provision exists whereby GBC1 companies may elect not to provide written evidence to the Commissioner of Income Tax showing the amount of foreign tax charged and enjoy a deemed taxation at 80% of the normal tax rate of 15%. Thus, the use of this long stop provision in isolation would reduce the effective rate of tax in Mauritius from 15% to 3%.
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