In Mauritius, the benefits of tax treaties are available exclusively to entities and individuals that qualify as residents under Mauritian tax laws. Residence status is determined based on criteria such as domicile, physical presence, or any other similar criterion specified by Mauritius’ tax regulations. This requirement ensures that only entities with substantial ties to Mauritius can access the advantageous provisions outlined in the country’s extensive network of double taxation treaties (DTTs).

Types of Resident Entities Benefiting from Tax Treaties

Global Business Companies (GBC1 and GBC2): These entities are structured under Mauritius’ Global Business License regime and enjoy various tax benefits. GBCs are utilized for international trading, investment holding, and other commercial activities. To access tax treaty benefits, GBCs must meet residency criteria and obtain a Tax Residence Certificate (TRC).

Trusts: Trust structures established in Mauritius can qualify for residency status if they meet local tax law conditions. Trusts are commonly used for asset protection, estate planning, and charitable purposes. They benefit from treaty provisions that mitigate tax liabilities on income distributed to beneficiaries or accruing within the trust.

Sociétés: This category includes partnerships and other collective investment vehicles recognized under Mauritian law. Sociétés can qualify for residency status if managed and controlled from Mauritius. This allows them to utilize tax treaties to optimize tax planning for their operations and investments.Foreign Companies with Mauritian Branches: Foreign companies, including those registered as Global Business Companies, can access Mauritius’ tax treaty benefits through their Mauritian branches. The Mauritian branch must meet residency conditions and obtain a Tax Residence Certificate from the Mauritius Revenue Authority. This certification confirms the entity’s residency status and eligibility for treaty benefits.

Obtaining Tax Residence Certificate (TRC)

To obtain a Tax Residence Certificate in Mauritius, entities must demonstrate:

  • Genuine business presence in Mauritius.
  • Compliance with regulatory obligations.
  • Meeting residency criteria specified under Mauritian tax laws.

Once certified, entities can leverage Mauritius’ network of DTTs to minimize tax exposure on cross-border transactions, including income from dividends, interest, royalties, and capital gains. The TRC facilitates efficient international tax planning and enhances the attractiveness of Mauritius as a jurisdiction for global business operations.

Conclusion

Mauritius’ commitment to facilitating international trade and investment through its tax treaty network underscores its role as a strategic gateway for global business. By providing clear guidelines for residency and access to treaty benefits, Mauritius aims to attract foreign investment, promote economic growth, and solidify its position as a preferred jurisdiction for international tax planning and structuring. The structured approach to residency and treaty access ensures transparency and compliance, benefiting both investors and the Mauritian economy alike.

Looking for something else to read, then you can check out our blog on ‘Unilateral Relief’. Simply click on the link and enjoy the read.