DOING BUSINESS IN MAURITIUS IN 2022
Effective 1 January 2019, the Mauritius government abolished the Category 2 Global Business License (GBC2) company, and introduced a new entity, called the Authorized Company (AC). Furthermore, Category 1 Global Business License (GBC1) companies are now simply known as the Global Business Company (GBC).
| Compare different Mauritius entities | Non-resident company | GBC | Investment fund | CIS fund | Limited Liability Partnership |
|---|---|---|---|---|---|
| Locally known as | Authorized company (AC) | Global Business Company (GBC) | Investment fund | Collective Investment Scheme | LLP |
| Best use of entity? | Global trading | Holding Company | Asset management | Portfolio Investments | Professional services |
| License required before invoicing global customers? | Yes (Authorized Company License) | Yes (GBC license) | Yes | Yes | No |
| How soon can you invoice Clients/sign sales contracts? | 1 month | 1 month | 6 months | 6 months | 1 month |
| How soon can your Firm hire staff? | Local staff not allowed | 1 month | 1 month | 1 month | 1 month |
| How soon can you sign a lease agreement? | Local lease not allowed | 1 month | 1 month | 1 month | Immediately |
| How long to secure corporate bank account numbers? | 2 months | 2 months | 3 months | 3 months | 2 months |
| How long to secure company registration/tax numbers? | 3 weeks | 3 weeks | 3 weeks | 3 weeks | 2 weeks |
| How long to secure license certificate? | 1 month | 1 month | 5 months | 5 months | Not required |
| Mauritius corporate tax rate on annual net profits? (foreign sourced income) | 0% | 3% | 3% | 3% | 0% |
| Mauritius corporate tax rate on annual net profits? (locally sourced income) | local trading not allowed | 15% | 15% | 15% | 0% |
| Limited liability entity? | Yes | Yes | Yes | Yes | Yes |
| Resident director required? | No | Yes (at least 2) | Yes (at least 2) | Yes (at least 2) | Yes (at least 2) |
| Company secretary legally required? | Recommended | Yes | Yes | Yes | Yes |
| Management Company required | Yes | Yes | Yes | Yes | Yes |
| Minimum/recommended paid up share capital? | US$1 | US$1 | 5% of funds raised from investors | Depends on license applied for | US$1 |
| Our recommended corporate bank account location? | ABC Bank | MCB | Bank One Mauritius | Afrasia Bank | ABC Bank |
| VAT payable on sales to local customers? | NA | 15% | 15% | 15% | 15% |
| Accounting and tax considerations | Non-resident company | GBC | Investment fund | CIS fund | Limited Liability Partnership |
|---|---|---|---|---|---|
| Statutory corporate tax payable? (foreign sourced income) | 0% | 3% | 3% | 3% | 0% |
| Statutory corporate tax payable? (locally sourced income) | local trading not allowed | 15% | 15% | 15% | 0% |
| Legally tax exempt in Mauritius if no locally sourced income? | Yes | No | No | No | Yes |
| Must file an annual tax return? | Yes | Yes | Yes | Yes | No |
| Must file annual financial statements? | Yes (financial summary) | Yes | Yes | Yes | Yes (statement of income) |
| Must always appoint an auditor? | No | Yes | Yes | Yes | No |
| Can have access to Access to Mauritius DTAAs? | No | Yes | Yes | Yes | No |
| Withholding tax on dividends to foreign shareholders? | None | None | None | None | None |
| Entity registration considerations | Non-resident company | GBC | Investment fund | CIS fund | Limited Liability Partnership |
| Resident director/partner/manager/legal representative required? | No | Yes | Yes | Yes | Yes |
| Management Company required | Yes | Yes | Yes | Yes | Yes |
| Appointment of a local company secretary required? | No but Recommended | Yes | Yes | Yes | Yes |
| Minimum number of shareholders/partners? | 1 | 1 | 1 | 1 | 2 |
| Minimum number of directors/managers? | 1 | 2 | 2 | 2 | 1 |
| Minimum/recommended paid up share capital? | US$1 | US$1 | 5% of funds raised from investors | Varies across licenses | US$1 |
| Can secure a financial services license? | No | Yes | Yes (required) | Yes (required) | Yes |
| Must appoint a local custodian? | No | No | Can be required | Can be required | No |
| Shelf companies available? | No | No | No | No | No |
| Must sign an office lease agreement during incorporation? | No | No | No | No | No |
| Can easily convert to a PLC / limited company? | Yes | Yes | Yes | Yes | No |
| Public register of entities? | Yes | Yes | Yes | Yes | Yes |
| Can have preference shareholders/partners? | Yes | Yes | Yes | Yes | Yes |
| Can bid for Government contracts? | Yes | Yes | Yes | Depend on license | Yes |
| Recommended to secure Mauritius residence for business owner? | No | Yes | Yes | Yes | Yes |
| Government grants available? | No | Yes | Yes | Yes | Yes |
| Good entity for trademark registration? | Yes |
| Can secure an import and export license? | Yes |
| Monthly VAT reporting to the Government always required? | No |
| Sponsorship by a local citizen required? | No |
| Temporary physical office solutions available? | Yes |
| You need a local resident as bank signatory? | No |
| Can be wholly foreign owned? | Yes |
| The entity will likely be regulated by? | Financial Services Commission |
| Shareholders & directors documents to be attested/translated? | Yes |
| Each foreign director needs a personal income tax number? | No |
| Foreign non-resident director needs a residence visa? | No |
| Maximum number of staff allowed? | No maximum number |
| Expatriate to local staff ratio? | None |
| Other useful information | Mauritius Substance Requirements |
| What will be included in my customer sales invoice? | Click link |
| This country has signed free trade agreements? | Yes, 46 Double Taxation Agreements signed |
| This country is a member of WIPO/TRIPS? | Yes |
| This country is a member of the ICSID? | Yes |
| Average custom duties incurred? | 1.48% (2018 data) |
| Government foreign investment approval required? | No |
| Average monthly office rental? (US$ per sq. m) | US$20 (2017 data) |
| Minimum statutory monthly salary? | MUR9,000 (US$245) |
| US$ deposit interest rate? (1-year average) | 3% (2017 data) |
| Overseas remittance currency controls? | None |
| Group HQ tax incentives? | No |
| Security deposit to be kept with Government? | No |
| Can secure trade finance? | Yes |
| Maximum shareholding for foreigners? | 100% |
| Banking considerations | |
| Multi-currency bank accounts available? | Yes |
| Corporate visa debit cards available? | Yes |
| Quality of e-banking platform? | Good |
| Crowd funding available in this country? | Yes |
Mauritius business setup summary
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Problems with Mauritius company formation
- Mauritius is working hard to overhaul its poor global reputation as a tax haven jurisdiction. Consequently, there has been a considerable increase in procedures, bureaucracy, and substance requirements from Mauritian authorities;
- In its efforts to overhaul its global reputation, Mauritius has made a register of shareholders and directors available to the general public;
- Effective 1 July 2019, the Mauritius Government issued the Income Tax (Amendment No. 2) Regulations 2019, requiring all Mauritius entities to fulfil economic substance requirements by i) employing local staff ii) leasing a physical office and iii) conducting core income-generating activity in the country and iv) incurring a minimum expenditure proportionate to its level of activities;
- Although Mauritius has been working hard to overhaul its international reputation, the country is still globally viewed as an island tax haven jurisdiction. Clients establishing a Mauritius offshore company can attract additional scrutiny from tax authorities and banks;
- The tourism industry is partially closed to foreign investors looking for a business registration in Mauritius. For instance, foreigners cannot have a majority stake in a hotel with less than 100 rooms. They also need to make an initial investment of at least US$300,000 to open a restaurant in Mauritius;
- Additional registrations required for trade license and data protection office will delay the engagement by 6 weeks;
Vulnerability to external shocks
- The island country is extremely dependent on tourism for its economic well-being, which makes it more vulnerable to external changes and shocks;
- While labor is easily available, it is difficult to get professionals in Mauritius, which is why there is a lot of untapped potential which can delay the speed of development and growth in the country;
- The legally tax-exempt Mauritius GBC2 license was abolished on January 1, 2019. An authorized company license will be given out instead.
Useful links for Mauritius
Bejarano ADF Consultants Group PLC does not recommend our Clients establish a business in Mauritius, due to the poor business environment provided by the Mauritius Government and Financial Services Commission to multi-national organisations. Bejarano ADF Consultants Group PLC instead recommends our Clients establish their businesses in these reputable zero tax jurisdictions.
