A corporation resident in Mauritius is subject to tax on its worldwide income. A non-resident corporation is liable to tax on any Mauritius-source income, subject to any applicable tax treaty provisions.
Corporations are liable to income tax on their net income, currently at a flat rate of 15%. Companies engaged in the export of goods are liable to be taxed at the rate of 3% on the chargeable income attributable to that export based on a prescribed formula.
Mauritius has a credit system of taxation whereby foreign tax credit is given on any foreign-source income declared in Mauritius on which foreign tax of similar character to Mauritian tax has been imposed.
All corporate bodies incorporated in Mauritius (except companies holding a Category 2 Global Business Licence and certain approved funds and associations) are subject to income tax. This applies to all associations and other registered bodies. Income derived by local partnerships is shared and taxed in the hands of the partners. Foreign corporations carrying on business, or having a place of business, in Mauritius are also liable to income tax on income derived from Mauritius. Resident sociétés are not liable to corporate tax.
Société means a société formed under any enactment in Mauritius and includes:
- a société de fait or a société en participation
- a limited partnership
- a joint venture, and
- a société or partnership formed under the law of a foreign country.
Income tax is payable on total net income before distribution at the following rates:
|Global Business Category 1 (GBC1) companies and offshore trusts (see below)
|Freeport operators or Private Freeport Developers carrying on Freeport activities other than providing goods and services on local markets
|Global Business Category 2 (GBC2) companies (see below)
|All other companies
Global Business Category 1 (GBC1) companies are liable to tax at the rate of 15%. However, they are entitled to a foreign tax credit equivalent to the higher of 80% of the Mauritius tax chargeable or the actual tax suffered abroad in respect of foreign-source income. The maximum effective tax rate is therefore 3%.
Global Business Category 2 (GBC2) companies incorporated under the laws of Mauritius are exempt from income tax and are not tax residents for treaty purposes. For more information, see the Tax credits and incentives section.
All banks are required to pay a special levy calculated according to their book profit and their operating income derived during, or its chargeable income in respect of, the preceding year. 'Operating income' means the sum of net interest income and other income before deducting non-interest expense.
The rates of the special levy on banks are as follows:
|Year of assessment commencing
|1 July 2016 and 1 July 2017
||Segment A: 10% of chargeable income;
Segment B: 3.4% on book profit;
1.0% on operating income
Segment A: Banking transactions with residents.
Segment B: Banking transactions with non-residents and corporations holding a Global Business Licence.
Except where the levy is computed on chargeable income, no levy shall be paid in a year where in the preceding year:
- the bank incurred a loss, or
- the book profit of the bank did not exceed 5% of its operating income.
Telephony service providers
Providers of public fixed or mobile telecommunication networks and services (including information and communication services, such as value added services and mobile internet), commonly known as ‘operators’, are liable to a solidarity levy. The solidarity levy is calculated according to the book profit and turnover for the preceding income year of the operator. The applicable rates are as follows:
Years of assessment commencing 1 July 2016 and 1 July 2017: 5% of the book profit and 1.5% of the turnover of the operator.
'Book profit' means the profit derived by an operator from all its activities and computed in accordance with International Financial Reporting Standards (IFRS).
No levy is to be paid in a year where, in the preceding year, the operator incurred a loss or the book profit of the operator did not exceed 5% of its turnover.
Corporate Social Responsibility (CSR) Fund
Every year, a company has to set up a CSR Fund equivalent to 2% of its chargeable income of the preceding year.
At least 50% of the CSR Fund set up on or after 1 January 2017 up to 31 December 2017 should be remitted to the Mauritius Revenue Authority (MRA), and at least 75% of the CSR Fund set up on or after 1 January 2018 should be remitted to the MRA.
In respect of the CSR Fund set up before 1 January 2019, the remaining amount of the CSR Fund shall be used to implement a CSR Programme in accordance with the company's own CSR Framework. For the CSR Fund set up on or after 1 January 2019, the remaining amount shall be used to implement a CSR Programme or finance a non-governmental organisation implementing a CSR Programme in the following priority areas of intervention:
- Dealing with health problems resulting from substance abuse and poor sanitation.
- Educational support targeting families in the Social Register of Mauritius.
- Family protection; protection to victims of domestic violence.
- Poverty alleviation targeting families listed in the Social Register of Mauritius.
- Social housing targeting families in the Social Register of Mauritius.
- Supporting persons with severe disabilities.
Any amount unspent (to a CSR Programme) shall be remitted to the MRA together with the company's annual return. The amount to be remitted to the MRA could be reduced upon prior written approval from the National CSR Foundation. This is where the company intends to spend the unremitted amount within the priority areas of intervention.
No CSR money shall be spent by a company on the following activities:
- Activities discriminating on the basis of race, place of origin, political opinion, colour, or creed.
- Activities targeting shareholders, senior staff, or their family members.
- Activities that are against public safety and national interest.
- Religious, political, trade union, self-financing, staff welfare, and marketing activities.
Where the amount paid out of the CSR Fund is in excess to the amount provided for under that CSR Fund, such excess may be carried forward and offset in equal instalments against any amount to be remitted to the MRA in respect of five succeeding years starting from year of assessment 2016/17.
Where a company is required to submit an Advance Payment System (APS) statement, it should remit 25% of the CSR amount to be remitted to the MRA together with the APS statements, and the final 25% is to be remitted on the submission of the final return.
Note that the following entities are not subject to the CSR regulations:
- A company holding a GBC1 Licence under the Financial Services Act.
- A bank holding a banking licence under the Banking Act, in respect of its income derived from its banking transactions with non-residents or with corporations holding a Global Business Licence under the Financial Services Act.
- An Integrated Resort Scheme (IRS) company referred to in the Investment Promotion (Real Estate Development Scheme) Regulations 2007.
- A non-resident société, a foundation, a trust, or a trustee of a unit trust scheme.
Also note the following:
- The CSR Fund shall apply in all respects to a resident société, other than a resident société holding a Global Business Licence under the Financial Services Act, its net income shall be deemed to be its chargeable income, and any distribution of its net income shall, for the purposes of the CSR Fund, be deemed to be dividends.
Local income taxes
Local income taxes levied by local administration, such as urban councils, do not exist in Mauritius.