Income Tax Exemptions in Mauritius

As Benjamin Franklin said "there are only two things certain in life: death and taxes". However although he said that taxes are inevitable there are some exemptions that each and every Mauritian citizen can benefit from.Here are the exemptions as follows:-

1. Dividends:- The dividends include those paid by a resident company in Mauritius or dividends paid by a co-operative society under the Co-Operative Societies Act (As at January 2019- companies paying a dividend exceeding RS 100,000 to any individuals, succession, society or trusts should file a return of dividends with the Mauritius Revenue Authority);
2. Interest paid to a non-resident, not carrying on any business in Mauritius:-by a corporation holding a Global Business Licence under the Financial Services Act out of its foreign source income or by a bank holding a banking licence under the Banking Act insofar as the interest is paid out of gross income derived from its banking transactions with non-residents and corporations holding a Global Business Licence under the Financial Services Act;
3. Interest, rents, royalties, compensations and other amounts paid by a special purpose fund established under the Financial Services Act 2007 to a nonresident;
4. Royalty:- payable to a non-resident by a company out of its foreign source income;
5. Gains or profits:- derived from the sale of units, securities or debt obligations by a person;
6. The first Rs 2.5 million of the aggregate amount received: - 

1. As lump sum by way of commutation of pension or by way of death gratuity or as consolidated compensation for death or injury, and paid -

    

   1. by virtue of any enactment;
   2. from a superannuation fund; and
   3. under a personal pension scheme approved by the Director-General;

    

2. as lump sum under the National Savings Fund Act;
3. by way of retiring allowance;
4. by way of severance allowance determined in accordance with the Labour Act; and
5. as compensation negotiated under section 42 of the Employment Rights Act, limited to the amount of severance allowance referred to in section 46(5)(i) and (ii) of that Act, on such conditions as may be prescribed;
6. Any transport allowance payable by an employer to an employee:-  
   1. the return bus fare between residence and place of work;

       

   2. petrol allowance, commuted travelling allowance and travel grant payable by the Government of Mauritius and the local authority to their employees; or

       

   3. the actual petrol or travelling allowance paid or 25% of the monthly basic salary up to a maximum of Rs 11,500 , whichever is the lesser, provided that the employee makes use of a private car registered in his own name for attending duty and for the performance of the duties of his office or employment;
7. Any Rent allowance payable to a person appointed to an office in:-  the police force, fire services, Forests Division, Prisons and Industrial School Service, Ministry of Fisheries, Department of Civil Aviation or Fire Unit of the Mauritius Marine Authority;
8. Passage benefits:- provided under a contract of employment not exceeding 6% of the basic salary;
9. Any retirement pension:- not exceeding the income exemption threshold in respect of Category A payable to a citizen of Mauritius who is not resident in Mauritius;
10. Alimony:- paid to a previous spouse whose marriage has been dissolved by a court of competent jurisdiction or in respect of maintenance paid to the spouse in accordance with an order of a court;
11. An employee whose emoluments do not exceed Rs 23, 461 per month:- is an exempt person and is not subject to tax deduction under the PAYE System.

For more information on Personal Taxation please have a quick read here or on the website of the Mauritius Revenue Authority. Also for further information regarding exempt income, refer to Part II of the Second Schedule of the Income Tax Act.

*** This article serves only as an informative purpose but if more details are required please consult a professional or the authorities concerned.