In Mauritius, a Tax Residence Certificate (TRC) holds significant importance for companies holding a Global Business Category 1 Licence (GBC1). This certificate enables such companies to benefit from Double Taxation Relief under the various tax treaties Mauritius has signed with other countries.
Procedures for Issuing a Tax Residence Certificate (TRC)
The process for obtaining a TRC involves several steps to ensure proper documentation and verification:
Application Process:
- Application Submission: The application for a TRC must be initiated by a Management Company acting on behalf of the GBC1 client. This is typically done through the Financial Services Promotion Agency (FSPA) in Mauritius.
- Forwarding to Income Tax Office: The FSPA serves as an intermediary and forwards the completed TRC application to the Income Tax Office (ITO) for further processing and evaluation.
Issuance and Validity: - Approval and Certification: Upon review, the Income Tax Office assesses the application and, if all requirements are met, issues the Tax Residence Certificate. This certificate attests that the company is considered a tax resident of Mauritius and is eligible for benefits under tax treaties.
- Apostille Certification: After issuance by the Income Tax Office, the TRC document undergoes apostillation by the Prime Minister’s Office of Mauritius. Apostillation is a form of authentication recognized internationally under the Hague Convention, which verifies the authenticity of public documents for use in foreign countries.
- Validity and Use: Once apostilled, the TRC becomes valid and can be used by the GBC1 company to claim Double Taxation Relief as per the terms outlined in the relevant tax treaties. This relief ensures that the company does not pay taxes on the same income in both Mauritius and the foreign country where it conducts business, thereby avoiding double taxation.
Importance and Compliance
Obtaining a TRC is crucial for GBC1 companies as it enhances their credibility and facilitates smoother international business operations. It demonstrates Mauritius’ recognition of the company as a bona fide tax resident, eligible for treaty benefits aimed at preventing fiscal evasion and fostering international trade relations.
In conclusion, the issuance of a Tax Residence Certificate in Mauritius involves a structured process managed through authorized channels. From application submission by a Management Company via the FSPA to final apostillation by the Prime Minister’s Office, each step ensures compliance with international standards and facilitates the company’s access to Double Taxation Relief under Mauritius’ tax treaties. This systematic approach supports Mauritius’ position as a favorable jurisdiction for global business activities.
If you loved this blog, then you can check our dedicated blog on ‘Resident Company’.
