Why should you invest in properties in Mauritius? The answer is simple – Tax Benefits! Ranked 13th out of 190 countries and the first in Africa in the 2020 World Bank Doing Business Report, Mauritius offers a wide array of fiscal incentives from a tax standpoint. This article will help you understand the different tax benefits of investing in properties in Mauritius. 

What tax benefits does Mauritius offer?

  • Unique flat tax rate of 15%
  • No Capital Gains Tax: Mauritius generally does not impose capital gains tax on the sale of residential properties. This means that any profit you make from selling a property may be tax-free.
  • Low Property Transfer Tax: The Property Transfer Tax in Mauritius is relatively low compared to many other countries. This tax is paid by the buyer, and the rates may vary based on the property’s value.
  • No Inheritance Tax: Mauritius does not levy inheritance tax. This means that your heirs may inherit your property without being subject to a significant tax burden.
  • Tax Exemptions for Residence Permit Holders: If you obtain a residence permit through property investment in Mauritius (such as through the Real Estate Scheme or the Integrated Resort Scheme), you may be eligible for various tax benefits, including a flat tax rate of 15% on income derived from the property.

What other tax advantages does Mauritius offer?

    • Double Taxation Avoidance Treaties (DTAs): Mauritius has a network of DTAs with numerous countries, which can help you avoid double taxation on income and capital gains, making it easier to repatriate funds without facing excessive taxation.
    • Tax Holidays for Certain Investments: The Mauritian government has introduced various incentives and tax holidays for certain types of property investments, such as those related to renewable energy, information and communication technology, and other strategic sectors.

How to benefit from these advantages?

Tax Benefits Eligibility for Individuals

To enjoy these advantages, whether you are a non-resident, retired, active, a company, or even a trust managed abroad, you must meet two essential conditions:

  1. Obtain a Mauritian residence permit by making a real estate investment in Mauritius through projects labeled as IRS, RES, SCS (Smart City Scheme) or PDS.
  2. Attain Mauritian tax residence by staying on the island for more than 183 days each year in your Mauritius residence.

Tax Benefits Eligibility for Companies

For companies or trusts aiming to purchase real estate in Mauritius, additional requirements include:

  1.  Establishing your headquarters in Mauritius.
  2.  Appointing at least two resident directors on the island.
  3.  Investing a minimum of $100,000 in Mauritius.
  4.  Employing at least one Mauritian citizen.
  5. Registering your main bank account or books of account in Mauritius.

Understanding Property Investment in Mauritius for Non-Citizens

Foreign investment in Mauritian real estate falls under the governance of the Non-Citizen Property Restriction Act. This law permits foreign nationals to acquire personal property under the Property Development Scheme (PDS). The property investment must amount to a minimum of US $375,000 or approximately 357,890 euros. There are numerous programs available in the most picturesque areas of the island, so it’s crucial to clearly communicate your preferences, requirements, and expectations with your real estate agency.

Subsequently, you’ll need to submit an application for the Investment Authority to the Economic Development Board Mauritius. The processing time, from filing the complete application to receiving a response from the regulator, typically ranges from a few days to several weeks.

Navigating Property Investment in Mauritius

In conclusion, investing in properties in Mauritius presents a range of compelling tax benefits that can significantly enhance your real estate investments. These advantages include the absence of capital gains tax, low property transfer taxes, exemptions for residence permit holders, and the presence of Double Taxation Avoidance Treaties (DTAs), among others. Mauritius indeed stands out as a tax-friendly destination for property investors, offering not only financial rewards but also the allure of a tropical paradise.

However, it’s vital to remember that tax laws and regulations can evolve, and individual circumstances vary. Therefore, we strongly recommend that you seek professional advice from tax experts or legal advisors who specialize in Mauritian property investments. Conducting thorough due diligence is paramount to ensure that your investment strategy aligns with the latest tax regulations and suits your unique needs and goals. By taking these steps, you can make well-informed decisions that lead to successful and rewarding real estate ventures in Mauritius.