Is Mauritius a Territorial Tax Country? The Honest Answer for 2025

The headline corporate tax rate in Mauritius is 15%, but the partial exemption regime cuts that to an effective 3% on qualifying foreign-sourced income including dividends, interest, royalties, and gains from the disposal of securities. Individual residents face the same 15% headline rate on Mauritius-sourced income, and foreign income remitted to the island is generally not taxed if it originated outside Mauritius. There is no capital gains tax and no withholding tax on dividends paid to non-residents, which makes the jurisdiction attractive for holding structures. For a broader comparison of how this stacks up against other low-tax jurisdictions, see Territorial Tax Countries: The Definitive List and How Each One Actually Works.

The Global Business Company, known as a GBC, is the primary vehicle foreigners use to access Mauritius's tax treaty network and partial exemption regime. A GBC must have genuine substance: at least two local directors, a local bank account, and records kept in Mauritius. Setup costs run approximately USD 3,000 to 5,000 for incorporation plus ongoing annual government fees around USD 1,750, with a registered agent adding roughly USD 2,000 to 4,000 per year depending on service level. The GBC structure is particularly effective for holding investments into Africa and India, where Mauritius has double tax treaties that reduce or eliminate withholding taxes at source.

Mauritius has signed over 45 double tax treaties, covering major investment destinations including India, China, South Africa, France, the UK, and most of sub-Saharan Africa. The India treaty was renegotiated in 2016 and capital gains benefits on Indian shares were phased out by 2019, but dividend and interest withholding reductions remain intact. For funds and holding companies routing income from Africa, the treaty network is still one of the deepest available from a low-tax jurisdiction outside Europe. No other Indian Ocean jurisdiction comes close to this treaty breadth.

Mauritius joined the OECD Inclusive Framework and has implemented the Base Erosion and Profit Shifting minimum standards, meaning pure shell companies without real local activity face increasing scrutiny. The Financial Services Commission enforces substance rules for GBCs: genuine management decisions must be made in Mauritius, core income-generating activities must be plausible, and economic substance reporting is required annually. A company that exists only on paper risks losing its GBC status and its treaty entitlements, which collapses the entire tax argument. Proper substance typically means real local staff or a credible managed services arrangement with a licensed management company.

Individuals become tax resident in Mauritius after 183 days in a tax year, or under a second test after 270 days cumulative over two consecutive years. Resident individuals pay 15% on Mauritius-sourced income; foreign income is only taxable if remitted to Mauritius, and even then, foreign tax credits apply. The island introduced a Premium Visa and various investor residency permits that can be obtained without meeting the full day-count threshold, though those routes do not automatically confer the same tax-resident benefits. There is no inheritance tax, no net wealth tax, and no gift tax, which makes Mauritius a credible personal residency option for high-net-worth individuals alongside the corporate structuring play.

Mauritius is not a zero-tax jurisdiction; the 3% effective rate on foreign income, while low, is not zero, and the 15% rate on locally sourced income is real. Jurisdictions like the Cayman Islands, BVI, or Dubai impose no corporate income tax at all. Mauritius wins on treaty access, which those zero-tax jurisdictions cannot match, but it loses on simplicity and cost. For individuals who just want no local tax with no substance burden, Mauritius is more complicated and more expensive than Dubai or Paraguay. The value proposition is treaty-driven structuring, not headline rate competition.