Mauritius offers a highly favorable tax regime for businesses, with several key advantages that make it an attractive destination for global operations.

Tax Advantages

  • No Withholding Tax on Remittance of Branch Profits: Companies can remit branch profits without incurring withholding tax, enhancing profitability and ease of financial management.
  • No Capital Gains Tax: Except for property development gains, there is no capital gains tax in Mauritius, providing a significant benefit for businesses involved in asset transactions.
  • Unlimited Carry-Forward of Tax Losses: Companies can carry forward tax losses indefinitely, allowing for better financial planning and offsetting future profits.
  • Deductible Royalties, Interests, and Service Fees: Payments to foreign affiliates are deductible as expenses, provided they are reasonable and correspond to actual expenses incurred.
  • Tax Exemption on Interest for Category 2 Banking Licence Holders: Interest paid on deposits in banks holding a Category 2 banking licence is exempt from tax, encouraging savings and investments.
  • 100% Accelerated Depreciation for Aircraft Companies: Aircraft companies benefit from a 100% accelerated depreciation rate in the first year, significantly reducing taxable income.
  • Investment Tax Credit: A 10% investment tax credit is available for capital expenditure, promoting business growth and development.
  • Tax-Exempt Dividends: Dividends paid by companies are exempt from tax, providing shareholders with more significant returns.
  • No Withholding Tax on Interest, Royalties, and Dividends: This exemption simplifies cross-border financial transactions and improves cash flow for businesses.
  • Tax-Exempt Royalties Paid to Non-Residents: Royalties paid to non-residents are exempt from tax, making Mauritius a competitive jurisdiction for intellectual property management.
  • Incentive Tax Rate for GBC1 Companies: Global Business Companies Category 1 (GBC1) are liable to tax at a reduced rate of 15%, enhancing their competitive edge.
  • Generous Foreign Tax Credit Mechanism: Businesses benefit from a generous foreign tax credit on foreign source income, reducing their overall tax burden.

Additional Benefits

  • No Estate Duty, Inheritance, Wealth, or Gift Taxes: These exemptions provide significant savings for business owners and investors.
  • No Stamp Duties, Registration Duties, or Levies: The absence of these duties reduces transaction costs and administrative burdens.
  • Zero Rated Value Added Tax (VAT): Qualified business transactions are zero-rated for VAT, lowering the cost of doing business.
  • Duty Concessions: Businesses receive duty concessions on office equipment, furniture, and motor vehicles, further reducing operational costs.

Conclusion

Mauritius’ tax regime provides numerous benefits that enhance its attractiveness as a business hub. The combination of tax exemptions, credits, and deductions offers substantial financial advantages, making it an ideal location for global business operations.