MRA collects all of its taxes through a self-assessment mechanism. Persons liable to pay the applicable tax or duty must submit declarations at the end of defined periods and pay the tax, if any, according to the declarations. The cases are selected for audit or investigation when the Director-General is not satisfied with the declaration or has reason to think that a person subject to tax has not submitted a declaration, and necessary action is taken in line with the relevant legislation.
Corporate Tax
No corporation based in Mauritius pays tax on its worldwide earnings. Any income derived from Mauritius is subject to taxation, subject to any applicable tax treaty conditions.
Corporations must pay income tax on their net income, which is currently set at a fixed rate of 15%. Companies engaged in the export of goods are subject to a 3% tax on chargeable income due to exports, calculated according to a formula.
Mauritius has a credit system for taxation, in which foreign tax credits are provided on any foreign-source income declared in Mauritius on which a foreign tax of a comparable nature to Mauritian tax has been imposed.
Income tax applies to all Mauritius-incorporated corporations (except a few designated funds and associations). Local partnerships (resident sociétés) earn income that is shared and taxed among the partners. Foreign firms doing business in Mauritius or having a place of business there, as well as Authorised Companies, are subject to income tax on income earned in Mauritius.
Fund for Corporate Social Responsibility (CSR)
Every year, a corporation is required to establish a CSR Fund equal to 2% of its previous year’s chargeable income.
The MRA should receive at least 75% of the CSR Fund established on or after January 1, 2019.
The leftover amount of a CSR Fund established before 1 January 2019 will be used to implement a CSR Program under the company’s own CSR Framework. The remaining funds shall be utilized to implement a CSR Programme or support a non-governmental organization undertaking a CSR Programme in the following priority areas of intervention, among others, for a CSR Fund established on or after 1 January 2019:
- Dealing with medical issues.
- Support and training for educators.
- Family protection, including abuse against women.
- Socioeconomic development as a strategy for reducing poverty.
- Affordable housing.
- Aiding people who have significant disabilities.
Any money leftover from a CSR program must be submitted to the MRA along with the company’s annual report. The amount to be remitted to the MRA could be lowered with the National CSR Foundation’s prior written approval.
Taxes on personal income
Individuals, regardless of nationality, who derive income from sources within Mauritius, whether or not they are residents, are subject to Mauritian income tax on all such income.
Residents are subject to Mauritian income tax on all of their worldwide earnings. Income earned outside of Mauritius, on the other hand, is taxable only to the degree that it is received in Mauritius.
Even if the corresponding remuneration is paid outside Mauritius, income from employment obligations performed in Mauritius is regarded to have been generated from Mauritius.
The 15% tax rate on annual net income received by an individual of up to 650,000 Mauritian rupees was cut to 10% on July 1, 2018. (MUR). Net income over MUR 650,000 will be taxed at a rate of 15%.
Value-added tax (VAT)
The Value Added Tax Act of 1998 and the Value Added Tax Regulations of 1998, as modified, include the VAT legislation.
VAT is a consumption tax on goods and services. It is imposed on all taxable supplies of goods and services made in Mauritius by a taxable person in the course of or in the promotion of his business. Imports of products into Mauritius are likewise subject to VAT, regardless of whether the importer is a taxable person. Other than zero-rated supplies, the value of taxable supplies is subject to a 15% VAT charge.
