Understanding the Mauritian Tax System: A Guide for Expats

No capital gains tax. No inheritance tax. No wealth tax. A remittance basis that keeps foreign income outside the net as long as it stays outside the country. On paper, the Mauritius tax system looks almost too good. And for internationally mobile people, it genuinely is one of the better ones in the world.

But the system is evolving. The Finance Act 2025 introduced meaningful changes – new surcharges for high earners, higher property transaction taxes, tighter rules around permanent residency, and a simplified (but stripped-back) income tax structure. If you are planning to move here, or already live here, these changes affect your planning.

Tax residency: the 183-day rule (and the other one)

The Mauritius tax year runs from 1 July to 30 June. Tax residency is determined by physical presence – not by permit type, not by nationality.

Under Section 73 of the Income Tax Act, there are three ways to be treated as a tax resident:

• 183-day rule: You have been present in Mauritius for 183 days or more in an income year
• 270-day rule: You have been present in Mauritius for an aggregate of 270 days across the current income year and the two preceding income years
• Domicile rule: You are domiciled in Mauritius – unless your permanent place of abode is outside Mauritius

The domicile rule is largely irrelevant for most expats. If you live outside Mauritius permanently and are visiting or relocating, the 183-day and 270-day tests are what matter.

Crucially: holding an Occupation Permit or Residence Permit does not make you a tax resident. These are immigration documents. You become a tax resident by being physically present long enough. The reverse also applies – you can become a tax resident without holding any permit.

Once you are a tax resident, you are liable on your worldwide income – but only to the extent that foreign income is remitted to (i.e., brought into) Mauritius. Income sitting in a foreign bank account that never touches Mauritius is not taxed here. This remittance basis is the core of Mauritius’s appeal for internationally mobile people.

Non-residents are taxed only on income sourced within Mauritius.

One important detail: employment income from duties performed in Mauritius is always treated as Mauritius-sourced, even if your salary is paid into a foreign account. Working remotely for a foreign employer from a Mauritius base is fine under the Premium Visa, but if you’re physically performing services here under a local employment contract, that income is taxable regardless of where it’s paid.

Income tax rates (from 1 July 2025)

Mauritius moved to progressive income tax in July 2023, replacing the old flat 15%. The Finance Act 2025 simplified it further to three bands:

MUR 500,000 is roughly USD 11,000. MUR 1,000,000 is roughly USD 22,000. In other words, for most expat professionals earning a reasonable salary, the effective rate lands somewhere in the 15 – 20% range on their Mauritius-taxable income – which is before the remittance basis reduces what’s actually in scope. Use the Mauritius tax calculator to run the numbers on your own income.

The previous structure had a longer progression of bands (2%, 4%, 6%, 8%, etc. working up to 20%). The new system is cleaner but removes several deductions that used to reduce taxable income – including deductions for household employee wages, charitable donations, and the angel investor allowance. Whether you come out ahead depends on which deductions you were previously using.

What isn’t taxed

This is where Mauritius genuinely stands out:

• No capital gains tax – gains from selling property, investments, or virtual assets are not taxed. If a gain arises from a business activity it may be assessed as business income, but pure investment gains are exempt. The Finance Act 2025 was widely expected to introduce CGT – it did not.
• No inheritance or estate tax
• No wealth tax
• No property tax on ownership – there are transaction taxes on buying and selling, but no annual charge for holding property
• Dividends from Mauritian companies are tax-free for individual shareholders
• Foreign income not remitted to Mauritius is not taxed

The Fair Share Contribution – the new surcharge for high earners

The Finance Act 2025 introduced a Fair Share Contribution (FSC), which runs from 1 July 2025 to 30 June 2028. Think of it as a temporary surcharge layered on top of the income tax system.

For individuals, the FSC applies at 15% on net income exceeding MUR 12 million (approximately USD 265,000), including dividend income from local companies. Dividends from trusts and foundations are excluded. It’s collected through the PAYE system.

Most salaried expats will never hit MUR 12 million. But high-earning professionals, business owners with notable local dividend income, or executives in financial services may find themselves in scope. Foreign tax credits cannot be used to offset the FSC liability. See the full Finance Act 2025 tax changes for all the detail.

VAT

Standard VAT rate is 15%. Two things changed under Finance Act 2025 that are relevant to expats:

• The VAT registration threshold has been lowered from MUR 6 million to MUR 3 million annual turnover. If you run a business here, check whether this pulls you into the VAT net.
• From 1 January 2026, foreign suppliers of digital and electronic services to Mauritius customers must register for and charge VAT – no turnover threshold applies. This affects both foreign businesses selling into Mauritius and potentially expats purchasing digital services from overseas providers.

Social contributions

If you’re employed in Mauritius – by a local employer or through a local entity – you’ll pay social contributions:

• Contribution Sociale Généralisée (CSG): Replaced the National Pensions Fund in 2020. Both employer and employee contribute at prescribed rates on basic salary.
• National Savings Fund (NSF): Employers contribute 2.5% of remuneration plus a 1.5% monthly levy on basic salaries. Employees contribute 1%.

Some non-citizen employees are exempt from CSG in specific circumstances – non-citizens employed by foreign contractors on government-funded projects, or non-citizens in export manufacturing during their first two years. If a double taxation agreement exists between Mauritius and your home country, and it removes Mauritius’s taxing rights on your employment income, CSG may also not apply.

Double taxation agreements

Mauritius has DTAs with over 46 countries, including the UK, France, India, South Africa, Germany, Luxembourg, and most major economies. These agreements determine which country has the right to tax specific income, and often provide for tax credits to prevent the same income being taxed twice. For treaty-by-treaty withholding rates, use our complete Mauritius double tax treaty table.

If you’re coming from a country with a DTA, check it carefully before assuming how your income will be treated. The interaction between a DTA and Mauritius’s remittance basis can produce favourable outcomes – but the specifics depend on your country of origin, income type, and permit status.

The MRA can issue a Tax Residency Certificate (TRC) confirming your Mauritius tax residency, which is useful for claiming DTA benefits or demonstrating tax emigration from your previous country of residence (particularly relevant for South Africans).

How your permit affects your tax position

Different permit types have different implications.

Premium Visa (digital nomad)

Under 183 days: no Mauritius tax liability on foreign income. Over 183 days: potentially a tax resident, with foreign income remitted to Mauritius becoming taxable. Spending in Mauritius on a foreign card is not a remittance. The visa does not create a permanent establishment risk for your foreign employer. See the Premium Visa guide for the full picture.

Occupation Permit – Professional (ProPass and Expert Pass)

The Finance Act 2025 raised the minimum monthly basic salary thresholds:

Professional permit holders who meet the 183-day threshold are tax residents and pay income tax on employment income earned in Mauritius. Foreign income not remitted to Mauritius remains outside scope.

Occupation Permit – Investor

Investors operate through a Mauritian company. The company pays corporate tax; the investor pays personal income tax on salary drawn and dividends received (dividends from Mauritian companies are tax-free for individuals).

Occupation Permit – Self-Employed

Requires an initial investment of USD 50,000, at least three letters of intent (including two from local clients), and minimum revenue of MUR 750,000 in year one. Self-employed individuals file annual self-assessment tax returns rather than being taxed through PAYE. For the full permit structure and Finance Act 2025 changes, see the Self-Employed Occupation Permit guide.

Residence Permit – Retired Non-Citizen

Available to those over 50. Requires a minimum transfer of USD 2,000/month (or USD 24,000/year) to a local bank account. Permit holders can invest in Mauritian businesses but cannot work locally or draw a salary. Remote work is permitted. A 20-year Permanent Residence Permit is available after five years, subject to having transferred a total of USD 200,000 to Mauritius.

Note: a proposed 180-day minimum annual stay requirement for retirees that was mentioned in the 2025 Budget Speech was not enacted. Flexibility for retired permit holders remains intact. For retirees considering a managed community setting, the PDS Senior Living scheme offers a 5-year income tax holiday on remitted income – not available under the standard retired permit. For the full picture on retiring in Mauritius – visa options, cost of living, and healthcare – see the Mauritius retirement guide.

Permanent Residence Permit

The Finance Act 2025 extended the minimum qualifying period from three to five years. A new 20-year PRP has also been introduced for professionals with a basic monthly salary of at least MUR 400,000 after five consecutive years. PRP holders are taxed as standard tax residents – the permit itself creates no special tax treatment.

Property transaction taxes – a notable change

This is the change with the most direct financial impact for expat investors. For a full breakdown of the schemes, purchase process, and what the deadline means in practice, see the guide to buying property in Mauritius.

From 1 July 2026, the taxes on property transactions involving non-citizens double:

These apply to properties acquired under EDB-regulated schemes: IRS, RES, PDS, Smart City Scheme, Invest Hotel Scheme, and Ground+2 apartment projects priced above MUR 6 million.

The new rates apply to deeds registered on or after 1 July 2026 – even if a reservation agreement or promise of sale was signed before that date. Signing a promise of sale before July 2026 does not lock in the current rates if the final deed is registered after the deadline.

On a USD 500,000 property, the difference is approximately USD 25,000 in additional duty. On a USD 1 million property, USD 50,000. For buyers considering Mauritian property, the timeline matters.

The good news: there is still no capital gains tax. An earlier proposal for a tax based on 10% of property value or 30% of resale profit was not implemented.

Corporate tax – relevant if you run a business

If you operate through a Mauritian company, the corporate tax position in brief:

No withholding tax on dividends paid to shareholders by Mauritian resident companies.

The GBC structure – for businesses principally operating outside Mauritius – preserves an effective rate well below the headline through the 80% partial exemption on qualifying income (foreign dividends, certain interest, foreign PE profits). GBC companies are excluded from the Fair Share Contribution and the Alternative Minimum Tax. See the business and investment guide for how GBC structures work in practice.

The Finance Act 2025 also introduced a formal transfer pricing framework. If you operate within a multinational group or have related-party transactions, begin preparing documentation now – the old reliance on Section 75 of the Income Tax Act is being replaced with a documentation-driven regime aligned with OECD standards.

Practical compliance

A few administrative points worth knowing:

• Tax Account Number (TAN): Once you become a tax resident, obtain a TAN from the MRA before filing returns
• PAYE: Employed individuals are taxed at source through the PAYE system – your employer handles deductions
• Self-assessment: Self-employed individuals file annual returns directly with the MRA
• Social contributions: CSG/NSF returns are submitted monthly by employers
• Foreign currency tax payments: From 1 October 2025, businesses receiving more than 50% of gross income in foreign currency must pay income tax in that foreign currency
• Tourist levy: From 1 October 2025, a levy of approximately EUR 3 per night applies to registered accommodation – relevant if you’re staying in hotels before finding a long-term rental

What’s still attractive, what’s tighter

To be clear-eyed about where things stand after Finance Act 2025:

What’s genuinely still attractive:

• No capital gains tax – confirmed, not introduced despite speculation
• No inheritance, wealth, or property ownership tax
• Remittance-based taxation on foreign income for residents
• Top income tax rate of 20% on chargeable income above MUR 1 million
• Tax-free dividends for individuals from Mauritian companies
• GBC regime with effective rates as low as 3% preserved
• Over 46 DTAs
• Premium Visa remains a tax-efficient option for sub-183-day stays
• 20-year PRP pathway introduced for high-performing non-citizens

What’s tighter or more expensive:

• Property transaction taxes double for non-citizens from July 2026
• Professional permit salary threshold raised to MUR 30,000/month
• Permanent residency requires five years instead of three
• VAT registration threshold halved to MUR 3 million
• Several personal tax deductions removed
• Fair Share Contribution applies above MUR 12 million individual net income
• Smart City tax incentives reduced for new projects
• Transfer pricing documentation now required for qualifying entities

The fundamentals remain sound. The adjustments are meaningful but not disqualifying – Mauritius is still competitive against the jurisdictions most expats are comparing it to. The property transaction tax increase is the sharpest change, and it has a clear deadline: July 2026. For a broader overview of the Mauritius tax system covering residency rules, corporate rates, and the double taxation treaty network, see the Mauritius tax guide.

Official resources

Where to go from here

• Keep the Tax and Compliance pillar page open as your base reference.
• Track recent policy shifts in Mauritius Tax Changes 2025.
• If you run a larger group structure, add the OECD Pillar Two QDMTT explainer to your review list.
• If you need case-specific help, use the contact page.

Disclaimer: This article is for general informational purposes only and does not constitute legal, tax, or financial advice. Tax legislation and administrative practice can change. Always verify details with official sources and seek qualified professional advice before making decisions based on this guide. All information is current as of February 2026, based on publicly available legislation including the Finance Act 2025 (Act No. 18 of 2025) and official guidance from the MRA and EDB.