Mauritius Finance Bill 2025/26 – More Rules, Less Guesswork!

Hot on the heels of the Mauritius Budget 2025, the Mauritius Finance Bill 2025/26 was released on 21 July 2025 and officially come into effect on 25 July 2025. Packed with important tax and regulatory changes, the Bill touches everything from personal and corporate taxes to VAT and residence permits for non-citizens.

Personal Tax

• As of 1 July 2025, the exemption threshold has been increased from Rs 30 000 to Rs 38 462.

• Fair Share Contribution (“FSC”) income threshold for an individual will include the net income of an individual as well as dividends received from a resident company and a co-operative society as well as the share of dividends in resident societies or successions. However, it shall exclude lump sum payments and dividends from Global Business Entity (Global Business Licence company; an authorised company and companies such as a non-resident société, a cell of a protected cell; a foundation; a trust or a trustee of a unit trust scheme that holds a Global Licence).

Corporate Tax

• For certain companies (excluding Global business entities, exempt bodies of persons and companies engaged in small enterprise, captive insurance), if their tax payable is less than 10% of their adjusted book profits, they will be required to pay a minimum tax of 10% on the adjusted book profits, which will be payable under the Advance Payment System (“APS”) if the company is liable to pay tax under APS.

• The Qualified Domestic Minimum Top-up Tax (“QDMT tax”) of 15% will be applicable for foreign subsidiaries of Multinational Enterprises based in Mauritius whose annual consolidated revenue of Euro 750 million or more is being taxed at an effective rate of less than 15% in a jurisdiction. Any non-compliance will incur a 5% penalty tax and 0.25% monthly interest tax.

• Companies with annual chargeable income over Rs 24 million that are liable to pay FSC, which will be collected under the VAT Act.

• From 1 January 2026, any Corporate Social Responsibility (CSR) Fund set up must give at least 50% of its CSR contribution to the Mauritius Revenue Authority (“MRA”).

• The eligibility of a company for Partial Exemption Regime (“PER”) is now only possible if the income is derived from the activities covered under that licence and the company satisfies the conditions relating to the substance of its activities, as may be prescribed. This new rule goes against the judgment in Alteo Energy v ARC & Anor 2025 SCJ 47, where the Supreme Court said that a company could still claim the 80% exemption on interest income even if interest was not its main business, as long as it carried out substantial economic activity.

• If a company is paying income tax but did not claim a tax credit or relief it was entitled to, it may still get a special tax credit or relief but only if it meets the prescribed conditions.

• If a company enters into a related party transaction, it must prepare and keep records in such manner as may be prescribed. Where the definition of “connected persons” means any two or more persons, where one controls, by reason of his relationship or otherwise with any other person, the business or income earning activity of the other, in Mauritius or from Mauritius and also covers “transaction” which refers to any transaction or series of transactions, carried out directly or indirectly, between connected persons, whether or not enforceable or intended to be enforceable, by legal proceedings; and also includes a transaction between a person and a cross-border business or other income earning activity of the same person.

• A company must now keep a written declaration from its Beneficial Owner (“BO”) or Ultimate Beneficial Owner (“UBO”) confirming that they are indeed the BO or UBO. The BO or UBO must also inform the company if there is any change in their status.

• If your company earns more than half of its total income in one specific foreign currency, then you are allowed to convert the company’s income tax at the exchange rate on the day you actually pay the tax liability. But – and here’s the twist, if your company does not derive, in an income year, more than 50% of its gross income in any of the foreign currencies but derives more than 50% of its gross income in a combination of the foreign currencies, then the company is able to pay its taxes at his option in any of those foreign currencies.

Value Added Tax

• Compulsory VAT registration will be required on specified digital or electronic services provided by foreign suppliers and the supplier will also be required to submit a return and list of taxable supplies made after the end of every taxable period. However, no credit for input tax will be available on the supply of digital or electronic services.

Mauritius Permits

• Retired Non-Citizen with a Residence Permit will have to make an initial transfer of at least USD 2 000 within 60 days and thereafter either USD 24 000 per annum or USD 2 000 per month.

• Applications for residence permits for retired non-citizens, occupation permits, and short-term occupation permits must now be made through the National Electronic Licensing System (“NELS”).

• The process for retired non-citizens is being formalised. Approved permits will be valid for 10 years and retired permit holders can also invest in businesses but cannot work or earn a salary.

• As from 1 July 2026, Non-citizens purchasing residential property under the EDB-approved schemes will now pay a 10% registration duty (previously 5%) on the property’s value at the time of registration as well as a 10% land transfer tax.

Others

• The qualifying age for the Basic Retirement Pension will be gradually increased from September 2026 onwards, with phased adjustments until September 2033, after which the eligibility age will be set at 65 years.

• From October 2025, tourists aged 12 and above will have to pay a Tourist tax per night of €3.

• Any individual or firm who wishes to act as a tax agent in Mauritius in order to prepare and submit tax returns and represent the taxpayer before the Authority must now be registered.

If you’d like to discuss these changes in more detail, please feel free to reach out to us and book an appointment.