Mauritius Tax Guide: What Entrepreneurs Need to Know

Understanding the Mauritian Tax System: Attractive Yet Demanding

How much tax would you actually pay on EUR 150,000 of profit in Mauritius? The answer is EUR 4,500 – and you would keep EUR 145,500 after all corporate and dividend taxes combined. In France or Belgium, the same profit leaves you with roughly EUR 78,750. That difference of EUR 66,750 per year is why so many international entrepreneurs are choosing company formation in Mauritius.

But the Mauritius tax system is more nuanced than a single headline number. Behind the competitive rates lies a precise regulatory framework, strict filing obligations, and subtleties that must be thoroughly understood. Getting the structure wrong, missing a filing deadline, or misunderstanding the Deemed Foreign Tax Credit can turn a tax advantage into a compliance headache.

This article provides a comprehensive overview of the Mauritian tax system as it applies to entrepreneurs, whether they operate through a Domestic Company, a Mauritius GBC, or as personal tax residents. It includes concrete worked examples and comparisons with France and Belgium, along with the filing obligations and penalties you need to know about. For the practical steps of incorporation, see our complete guide to company formation in Mauritius.

What Is the Corporate Tax Rate in Mauritius?

Mauritius applies a flat corporate income tax rate of 15%. This rate applies uniformly to all categories of companies, Domestic Companies and GBCs alike, regardless of the business sector or turnover volume.

What This Means in Practice

Taxable profits are calculated according to standard accounting rules, with deduction of legitimate operating expenses
There is no progressive rate: the rate is flat from the first euro (or rupee) of profit
Tax losses can be carried forward for up to 5 years
There is no capital gains tax in Mauritius, a considerable advantage for investment and holding activities

The Reduced 3% Rate on Service Exports

Certain service export activities benefit from a reduced rate of 3%. This regime applies notably to companies providing services to clients located outside Mauritius: consulting, software development, financial services, digital marketing. Eligibility conditions are specific and must be verified on a case-by-case basis.

Concrete example. A Domestic Company specializing in web development, based in Mauritius, with 100% of its clients in France, can benefit from the reduced 3% rate on its export service income. On a profit of EUR 80,000, the tax would be EUR 2,400 instead of EUR 12,000 at the standard rate.

Comparison with France and Belgium

	Mauritius (standard)	Mauritius (export/GBC)	France	Belgium
Corporate tax rate	15%	3%	25%	25%
Capital gains tax	0%	0%	25% (included in corporate tax)	0% (subject to conditions)
Withholding tax (outgoing dividends)	0%	0%	12.8% - 30%	30%
Social contributions on dividends	No	No	Yes (if self-employed)	No
Wealth tax	No	No	IFI (real estate)	No
Inheritance tax	No	No	5% - 60%	3% - 80%

Worked example: an entrepreneur with EUR 150,000 in profit.

Item	France (SASU)	Belgium (SRL)	Mauritius (Domestic export)	Mauritius (GBC)
Taxable profit	EUR 150,000	EUR 150,000	EUR 150,000	EUR 150,000
Corporate tax	EUR 37,500	EUR 37,500	EUR 4,500	EUR 4,500
Profit after corporate tax	EUR 112,500	EUR 112,500	EUR 145,500	EUR 145,500
Flat tax / withholding on dividends	EUR 33,750 (30%)	EUR 33,750 (30%)	EUR 0	EUR 0
Net income after tax	EUR 78,750	EUR 78,750	EUR 145,500	EUR 145,500
Effective overall rate	47.5%	47.5%	3%	3%

The difference is striking: on EUR 150,000 of profit, an entrepreneur in Mauritius keeps approximately EUR 66,750 more than in France or Belgium. This comparison assumes the entrepreneur is tax resident in Mauritius and that eligibility conditions for the reduced rate are met.

How Does the Deemed Foreign Tax Credit (DFTC) Work for GBCs?

The Deemed Foreign Tax Credit (DFTC) is the most significant tax mechanism for Global Business Companies. It allows for a substantial reduction of the effective tax burden on foreign-source income.

Detailed DFTC Mechanism

The GBC is taxed at the standard 15% rate on its foreign-source income
An automatic tax credit of 80% of the tax due is granted
The effective tax rate is thus reduced to 3% on this income

Worked calculation. A GBC generates EUR 500,000 in foreign-source profits.

Gross tax: 500,000 x 15% = EUR 75,000
DFTC (80% credit): 75,000 x 80% = EUR 60,000
Net tax payable: 75,000 - 60,000 = EUR 15,000
Effective rate: 15,000 / 500,000 = 3%

Conditions for DFTC Application

The DFTC is not automatically available in all cases. To qualify, the GBC must:

Hold a valid Global Business Licence issued by the FSC
Meet the economic substance requirements (offices, employees, decision-making in Mauritius)
The income must be of foreign source (derived from activities conducted outside Mauritius)

It is essential to note that the DFTC does not apply to Mauritian-source income. GBCs generating local revenue are taxed at the full 15% rate on that portion.

Mixed income example. A GBC consulting firm generates EUR 300,000 in revenue. EUR 250,000 comes from clients in Europe (foreign source) and EUR 50,000 from clients in Mauritius (local source).

Tax on foreign income: 250,000 x 3% = EUR 7,500
Tax on local income: 50,000 x 15% = EUR 7,500
Total tax: EUR 15,000 (effective overall rate: 5%)

To understand the differences between GBC and Domestic Company and choose the right structure, see our detailed comparison.

How Do Mauritius’ Tax Treaties Work?

One of Mauritius’ major assets is its extensive network of Double Taxation Avoidance Agreements (DTAAs). Mauritius has signed treaties with over 45 countries, including:

France: treaty signed in 1980, revised in 2011
India: one of the most historically significant treaties (renegotiated in 2016)
South Africa, United Kingdom, Germany, China, Luxembourg
Numerous African countries: Senegal, Madagascar, Tunisia, Botswana, Rwanda, etc.

The Practical Importance of Tax Treaties

Tax treaties allow you to:

Avoid double taxation: income taxed in one country will not be taxed again in the other (or will benefit from a tax credit)
Reduce withholding taxes on dividends, interest, and royalties paid between the two countries
Provide a framework of legal certainty for international transactions

Important: only GBCs can fully access the benefits of Mauritius’ tax treaties. Domestic Companies generally do not have access, except in limited cases.

Concrete Examples of Tax Treaty Application

France-Mauritius treaty: dividends. Without a treaty, France levies a withholding tax of 12.8% (non-resident legal entities) on dividends paid abroad. Thanks to the France-Mauritius treaty, this withholding is reduced to 5% if the recipient holds at least 10% of the distributing company’s capital, or 15% in other cases.

Worked example. A Mauritian GBC owns 100% of a French SAS that distributes EUR 200,000 in dividends.

Without treaty: withholding tax of 12.8% = EUR 25,600
With treaty (holding > 10%): withholding reduced to 5% = EUR 10,000
Tax in Mauritius (3% via DFTC): EUR 6,000
Total taxes: EUR 16,000 (8% effective) instead of EUR 31,600

Mauritius-India treaty: royalties. The treaty reduces the withholding tax on royalties paid from India to Mauritius to 15% (instead of 20% under Indian domestic law). For a GBC receiving software licence royalties from India, the savings are significant at scale.

The Tax Residency Certificate (TRC)

To benefit from tax treaties, a GBC must obtain a Tax Residency Certificate (TRC) from the Mauritius Revenue Authority. This certificate confirms that the company is tax resident in Mauritius and allows it to claim treaty benefits with foreign tax authorities.

Obtaining the TRC is conditional on meeting the economic substance requirements. Without genuine substance in Mauritius, the TRC may be refused, and treaty benefits are lost.

What Is the VAT Rate in Mauritius and How Does It Apply?

Mauritius applies a standard VAT rate of 15% on most goods and services. Certain goods and services benefit from a reduced rate or exemption.

When Must You Register for VAT?

VAT registration is mandatory when annual turnover exceeds MUR 6 million (approximately EUR 120,000)
Registration is voluntary below this threshold, which can be advantageous for recovering VAT on purchases
Registered businesses must file quarterly or monthly VAT returns

VAT and Service Exports

Service exports are generally zero-rated. This is a major advantage for internationally oriented businesses. A consultant based in Mauritius who invoices exclusively European clients does not charge Mauritian VAT on their services.

VAT and GBCs

GBCs conducting most of their activity internationally often fall outside the scope of Mauritian VAT for their export services. Nevertheless, they may be subject to VAT on local purchases (office rent, supplies, services) and should carefully structure their VAT position to avoid bearing non-recoverable VAT costs.

Example. A GBC providing international consulting pays EUR 2,000/month in rent (including 15% VAT, approximately EUR 260/month). If not registered for VAT, it cannot recover that EUR 3,120 annually. Voluntary registration may therefore be worthwhile depending on the amounts involved.

How Does Personal Income Tax Work in Mauritius?

The Income Tax Scale

Mauritius applies a progressive income tax system for individuals:

0% on the first bracket (depending on applicable deductions and allowances). The basic allowance is approximately MUR 325,000 per year (about EUR 6,500) for a single person, and more for a couple with children.
15% on taxable income up to MUR 3.5 million per year (approximately EUR 70,000)
25% on taxable income exceeding MUR 3.5 million per year

Comparison with France

Annual income	France marginal rate	Mauritius marginal rate
EUR 0 - 11,000	0%	0%
EUR 11,000 - 28,000	11%	15%
EUR 28,000 - 82,000	30%	15%
EUR 82,000 - 177,000	41%	25%
> EUR 177,000	45%	25%

From EUR 28,000 in income onward, the Mauritian advantage becomes significant. The gap widens further at higher income levels.

Concrete example. An entrepreneur who is tax resident in Mauritius pays themselves an annual salary of EUR 100,000.

In France: approximately EUR 25,000 in income tax (excluding social contributions of 9.2% CSG + 0.5% CRDS)
In Mauritius: approximately EUR 14,000 in income tax
Savings: approximately EUR 11,000, and considerably more when French social contributions are included

Personal Tax Residency in Mauritius

An individual is considered tax resident in Mauritius if they:

Are domiciled in Mauritius and have their permanent home there
Have been present in Mauritius for at least 183 days during the tax year (1 July to 30 June)
Have been present in Mauritius for at least 270 days across the two preceding tax years combined

Tax residency is a crucial element. It determines whether your worldwide income will be taxable in Mauritius or only your Mauritian-source income.

Tax Advantages for Residents

No capital gains tax at the individual level
No inheritance tax
No wealth tax
Foreign-source income is only taxable if remitted to Mauritius (remittance basis for non-domiciled residents)

This last point is fundamental. A French entrepreneur who relocates to Mauritius and retains income abroad (dividends, interest, rental income) is only taxed in Mauritius on amounts actually transferred to the island. Amounts kept abroad are not subject to Mauritian tax.

For the practical steps involved in relocating, see our expatriation guide for Mauritius.

What Are the Most Common Tax Mistakes?

Mistake #1: Believing Mauritius is a Tax Haven

This is incorrect. Mauritius is a tax-competitive but regulated jurisdiction. The country is on the EU whitelist, complies with OECD standards on tax transparency, and has signed the BEPS multilateral convention. Compliance obligations are real and strictly enforced.

Mistake #2: Thinking You Pay No Taxes in Mauritius

This is a dangerous oversimplification. The 15% rate is very real. The effective 3% rate for GBCs is subject to substance and compliance conditions. Entrepreneurs who ignore these obligations expose themselves to reassessments or even penalties.

Mistake #3: Believing That Simply Creating a Company in Mauritius Means Being Taxed There

Economic substance is a prerequisite. Without a genuine presence in Mauritius (offices, employees, decision-making), a company may be refused its tax residency certificate and lose access to tax treaties. Worse, the tax authorities in the entrepreneur’s country of origin may reclassify the company as a sham structure.

Mistake #4: Assuming Tax Treaties Eliminate All Taxation

Treaties mitigate double taxation; they do not eliminate it in all cases. The mechanisms vary by treaty (tax credit, exemption, reduced rates). It is essential to analyse the specific treaty applicable to your situation.

Mistake #5: Confusing the Nominal Rate with the Effective Rate

While the nominal rate is identical for Domestic Companies and GBCs (15%), the effective rate differs considerably thanks to the DFTC for GBCs. Moreover, access to tax treaties is reserved for GBCs. The choice of structure therefore has a direct tax impact. Our GBC vs Domestic comparison details these differences.

Mistake #6: Forgetting Tax Obligations in Your Country of Origin

A French entrepreneur who creates a company in Mauritius remains subject to reporting obligations in France: declaration of foreign bank accounts (form 3916), declaration of holdings in foreign companies, potential exit tax on latent capital gains. Ignoring these obligations can result in penalties of EUR 1,500 per undeclared account per year.

What Are the Filing Obligations for a Company in Mauritius?

For Companies

Annual income tax return filed with the MRA, within 6 months of the financial year end
Advance Payment System (APS): quarterly advance tax payments for companies exceeding certain turnover thresholds
VAT returns (if applicable): quarterly or monthly
For GBCs: annual reporting to the FSC, including audited accounts and business activity declarations

For Individuals

Annual income tax return due by 30 September (for the tax year ending 30 June)
Declaration of worldwide income for tax residents (or only remitted income for non-domiciled individuals)

Penalties for Non-Compliance

The MRA has significant audit and penalty powers:

Late payment penalties: 2% per month on unpaid tax
Surcharges for inaccurate or fraudulent returns
Criminal prosecution in the most serious cases (tax fraud, money laundering)

An entrepreneur who fails to file their tax return on time faces an automatic penalty of MUR 5,000 (approximately EUR 100) plus 2% per month on the tax due. On a tax liability of EUR 10,000, that amounts to EUR 200 per month of delay.

For the rigorous management of your tax obligations, a professional accounting and compliance service is essential.

Frequently Asked Questions

Is the 3% rate legal and internationally recognized?

Yes. The effective 3% rate for GBCs results from the Deemed Foreign Tax Credit, a mechanism enshrined in Mauritian law (Income Tax Act). Mauritius is on the European Union whitelist, complies with OECD standards, and has signed the BEPS multilateral convention. The Mauritian tax system is recognized as compliant by international bodies. This is not an aggressive tax optimization scheme. It is the country’s legal framework.

Does a French entrepreneur in Mauritius still have to pay taxes in France?

It depends on your tax residency. If you become tax resident in Mauritius (183+ days of presence per year, centre of economic interests transferred), you will in principle no longer be taxable in France on your worldwide income. However, you remain taxable in France on French-source income (rental income, real estate capital gains) and you must comply with the reporting obligations related to the change of residency (exit tax, departure declaration). The France-Mauritius treaty prevents double taxation on covered income.

How does the remittance basis work for non-domiciled residents?

A tax resident in Mauritius who is not “domiciled” in the Mauritian sense (i.e., a recent expatriate whose domicile of origin is not Mauritius) is only taxed on foreign-source income if it is remitted to Mauritius. Income kept abroad is not taxable. This regime is particularly advantageous for entrepreneurs with diversified income across multiple countries. In practice, this means you can structure your financial flows to legally optimize your taxation.

Are dividends paid from a Mauritian company taxed?

In Mauritius, there is no withholding tax on dividends paid by a Mauritian company, whether the recipient is resident or non-resident. This is a major advantage compared to France (30% flat tax) or Belgium (30% withholding tax). For a Mauritian tax resident, dividends received from their own company are taxed as part of personal income tax at the rate of 15% or 25% depending on the bracket, but no withholding is deducted upstream.

Can Mauritian tax law change?

As in any jurisdiction, tax legislation can evolve. However, Mauritius has demonstrated great tax stability over the decades. The 15% rate has been in effect for many years, and the DFTC has been maintained despite international pressure. The country has every incentive to preserve an attractive framework for international entrepreneurs, as the global business sector represents a significant share of its GDP. Recent changes have primarily strengthened substance and compliance requirements, without touching the rates.

When This Makes Sense

The Mauritius tax framework delivers the most value in these specific situations.

You are a tax resident of Mauritius (183+ days per year) and operate an international business through a GBC or a Domestic Company with export service income. The combination of 3% corporate tax and 0% dividend withholding is extremely competitive.
You run a holding structure with subsidiaries in countries covered by Mauritius’ 45+ tax treaties. The reduced withholding rates on dividends, interest, and royalties can save tens of thousands of euros annually.
You are relocating from a high-tax country (France, Belgium, Germany) and the personal income tax savings alone (15-25% vs 30-45%) justify the move, before even counting corporate tax benefits.
You have diversified international income and can benefit from the remittance basis – only income actually transferred to Mauritius is taxable for non-domiciled residents.
You are planning a long-term business base in the Indian Ocean or African region, and want a stable, predictable tax environment backed by a jurisdiction on the EU whitelist.

When This Is NOT the Right Fit

The Mauritius tax framework does not help everyone equally.

You remain tax resident in a high-tax country. If you do not relocate, anti-avoidance rules (like France’s Article 209 B) can neutralise the corporate tax benefit entirely. The Mauritian tax rate becomes irrelevant if your home country taxes the profits anyway.
Your income is below EUR 50,000. The fixed costs of maintaining a Mauritian company (EUR 2,000-12,000 per year) absorb a disproportionate share of the tax savings at lower revenue levels.
You generate income primarily from Mauritius. The 3% rate applies only to foreign-source income. Local income is taxed at the full 15%. A purely local business does not benefit from the DFTC.
You are not prepared to meet substance requirements. The 3% rate for GBCs is conditional on genuine economic presence in Mauritius. Without it, the MRA can deny the DFTC, and your home country’s tax authority can reclassify your company.

Common Mistakes to Avoid

Assuming the 3% rate applies automatically. The DFTC requires a valid GBC licence, genuine substance in Mauritius, and foreign-source income. If any of these conditions is not met, the full 15% rate applies. See our article on mistakes when setting up a company in Mauritius.
Ignoring the 25% bracket on personal income. The 15% personal tax rate only applies up to MUR 3.5 million (roughly EUR 70,000). Above that, the rate jumps to 25%. Entrepreneurs paying themselves high salaries need to factor this in.
Not registering for VAT when it would be beneficial. While VAT registration is mandatory above MUR 6 million in turnover, voluntary registration below that threshold allows you to recover VAT on local purchases. This can save several thousand euros per year.
Failing to budget for advance tax payments. The Advance Payment System (APS) requires quarterly payments for companies above certain thresholds. Cash flow planning must account for these instalments.
Not using the right structure for your income type. A Domestic Company with export service income can achieve the same 3% rate as a GBC – without the GBC’s higher compliance costs. Understanding which structure suits your business saves thousands per year. Read our GBC vs Domestic Company comparison for guidance.

Optimising Your Tax Position in Mauritius, in Full Compliance

The Mauritian tax system is simple in structure but demanding in application. Rates are competitive, treaty benefits are real, and the framework is favourable to international entrepreneurs. But these advantages are only accessible to businesses and individuals that scrupulously follow the rules: economic substance, tax compliance, transparency.

Getting professional support from someone who understands the subtleties of the Mauritian tax system is not a luxury. It is a necessity to avoid pitfalls and maximize benefits legally and sustainably.

At CAP Maurice, we support entrepreneurs in understanding and optimising their tax framework in Mauritius, in full compliance with local and international regulations. From company formation to accounting and compliance, we handle every aspect of your Mauritius setup. Every situation is unique. Book a call for a personalised analysis of your project.

Sources and official references

Income Tax Act 1995 (Mauritius): supremecourt.govmu.org
Mauritius Revenue Authority (MRA), taxation, TRC, Partial Exemption: mra.mu
OECD (BEPS Actions 5 and 6): oecd.org/tax/beps
French BOFiP (international taxation): bofip.impots.gouv.fr
Network of 45+ Mauritian tax treaties: MRA
France-Mauritius treaty 1980 and 2018 BEPS MLI: see our complete guide

Article written by Quentin, founder of CAP Maurice. Last updated 27 May 2026. To optimise your taxation legally and sustainably, book a discovery call or see our Accounting & Management service.