Offshore Trusts Report: Mauritius
In most respects, the 2001 Act inherited tax privileges
granted under previous acts, and Section 46 of the Income Tax Act
1995 was amended accordingly:
(1) Subject to section 7 and subsections (2) and (3)
of this section, every trust shall be liable to income tax on its
chargeable income at the rate specified in Part III of the First
(2) A trust of which
(a) the settlor is a non-resident; and
(b) all the beneficiaries appointed under the terms of the trust
are, throughout an income year, non-resident, or hold a Category
1 Global Business Licence or a Category 2 Global Business Licence
under the Financial Services Development Act 2001
shall be liable to income tax on its chargeable income at the rate
specified in Part II of the First Schedule.
(3) Where a trust which qualifies under subsection (2) deposits
a declaration of non-residence for any income year with the Commissioner
within 3 months after the expiry of the income year, it shall be
exempt from income tax in respect of that income year.
(4) The chargeable income under subsections (1) and (2) shall be
the difference between:
(a) the net income derived by the trust; and
(b) the aggregate amount distributed to the beneficiaries under
the terms of the trust.
(5) Any amount distributed to the beneficiaries under the terms
of the trust shall be deemed to be a charge under section 10(1)(d)
and shall be liable to income tax in the hands of the beneficiaries.
(6) Notwithstanding subsection (5), a non-resident beneficiary of
a trust shall be exempt from income tax in respect of his income
under the terms of the trust.
Offshore Trusts are taxed in the same way as Offshore
Companies. These pay corporate income tax at 15% (0% if incorporated
before 1st July 1998). In fact until 2003 they could opt to
pay tax at any rate they chose between 15% (or zero) and 35%,
and normally made this choice according to the rules governing
'controlled foreign corporations' in the country where the major
shareholder is based. However, legislation enacted in 2000 removed
the facility to choose tax rates from 2003.
Offshore Companies, and therefore Offshore Trusts, are also
exempt from stamp duty, land transfer tax, and capital gains
Offshore Trusts are also able to take advantage
of Mauritian Double Tax Treaties.
An offshore trust is allowed a credit for foreign
tax on its foreign-source income. If no written evidence is
presented to the Mauritius Commissioner of Income Tax showing
the amount of foreign tax charged, the amount of foreign tax
shall nevertheless be conclusively presumed to be equal to 90
per cent of the Mauritius tax chargeable with respect to that
income. However, this deemed foreign tax credit of 90% was reduced
to 80% as from the year of assessment 2003/2004, which is based
upon the year of income ending June 30, 2003.
As noted above, an offshore trust may opt by written
notice to the Mauritius Commissioner of Income Tax to be treated
as non-resident in Mauritius for tax purposes, in which case
it will not be subject to any income tax in Mauritius. However,
being non resident, the offshore trust may not benefit from
Mauritius' extensive network of double taxation agreements.
Mauritius Cuts Company Registration Fee Friday 8/1/2016 Mauritius has slashed the registration fee for a small private company with a turnover not exceeding MUR10m (USD276,700) from MUR2,500 to MUR500.
Nautilus Opens Office In Mauritius Friday 13/12/2013 Nautilus Group, an independent trust company based in Jersey, announced on December 09, 2013 that it has opened an office in Mauritius as part of its strategy for global growth.
Offshore Company Formations Have Slowed Wednesday 7/8/2013 The majority of offshore jurisdictions experienced a decline in company incorporation activity in the second half of 2012 compared with the first half, according to legal services consultancy the Applebly Group.
Offshore Merger And Acquisition Activity Rises Wednesday 9/5/2012 A new report from Appleby shows that transaction values for mergers and acquisitions (M&A) in major offshore financial centers rose by 25% in the first quarter of 2012.
Atlas Targets Asian Trust Services Market Tuesday 18/10/2011 Atlas Corporate Services Group, a leading international corporate and trust service provider, has announced that it has been granted new licences to operate in the Ras-Al-Khaimah Free Trade Zone and in Mauritius, as the firm expands its global reach into Asia.
Mauritius Unveils 2011 Budget Monday 22/11/2010 Mauritian Finance Minister Pravind Jugnauth has unveiled details of the country’s
2011 budget, designed to rebalance growth, to boost productivity, and to consolidate
social justice, and providing for a number of key fiscal measures, designed to
contain the budget deficit at 4.3% of gross domestic product.
India Presses Mauritius To Renegotiate Treaty Tuesday 25/5/2010 The Indian government would like to see an end to the provision in the India-Mauritius tax treaty which provides that capital gains from sale of securities in India can only be taxed in Mauritius.
India Investment Restrictions Take Effect Tuesday 13/4/2010 Indian government changes to foreign direct investment rules have taken effect from April 1, 2010. The new rules require foreign venture capital funds to obtain prior approval for investment in Indian venture funds, and investment in unregistered trusts is no longer permitted.
European Parliament ACP Report Targets Tax Havens Monday 25/1/2010 The European Parliament has called on the European Commission and the governments of the African, Caribbean and Pacific states to 'include the fight against abuse of tax havens, tax evasion and illicit capital flight as a matter of priority' in the revised Cotonou Agreement, which governs relations between the European Union and the ACP states.
Mauritius Not A Tax Haven, Says Vice Premier Thursday 21/1/2010 The Vice Prime Minister of Mauritius, Ramakrishna Sithanen, on a visit to India, is concerned that India should not set Mauritius aside for special treatment in its efforts to address tax treaty misuse.