The history of Mauritius begins with its discovery by Portuguese navigators in the 15th century. Today, the country is an independent republic, economically dynamic and has a unique reputation throughout the world thanks to its multicultural population and political stability. Mauritius is a luxury destination, but it is not just about the friendliness of its people, its golden beaches and its hotels, which are regularly awarded on the international scene for their quality. Indeed, this small spot on the Indian Ocean has become a renowned financial center, a tax-advantaged jurisdiction, thanks to its highly competent banks and service providers. So much so that foreign investors have been flocking in for several years, attracted by the various programs and laws in their favor, always in a transparent manner.
What are the tax advantages of buying a property in Mauritius?
Mauritius’ tax laws are designed to encourage investment, including from abroad. Here are the key points to remember about real estate:
- 5% tax on the acquisition and resale of a property;
- No additional tax on real estate capital gains in case of resale;
- Double tax treaty on income with 45 countries to date. With France, this agreement extends to real estate purchased in Mauritius, which cannot be taxed by the French tax authorities.
- Taxation of only 15% of rental income and only in Mauritius;
- Real estate purchased in Mauritius is not included in the calculation of the IFI taxable base;
- Absence of housing tax, property tax and local tax;
Buying real estate in Mauritius: programs that make you eligible for residence
The Mauritian government has put in place several real estate schemes allowing foreigners to obtain permanent residence in the country:
- The Property Development Scheme (PDS);
- The Invest Hotel Scheme (IHS);
- The Smart City Scheme;
- The Integrated Resort Scheme (IRS) – an earlier scheme, replaced by the PDS;
- The Real Estate Scheme (RES) – another previous scheme, replaced by the PDS ;
Depending on the regime, the foreign investor and 3 of his/her dependent relatives (spouse, cohabitant, biological child, adopted child, stepchildren under 24 years of age, unmarried close relative) can obtain a permanent residence permit valid for an extended period of 20 years and valid for the entire period of ownership of the property by the said investor.
Important: For retired residents, only the spouse or partner is granted a permanent residence permit.
Finally, the rental income generated by the real estate investment in one of these schemes can be transferred outside Mauritius without any tax or legal restrictions.
Becoming a resident in Mauritius by investing in a PDS
The purchase of a property, whether it is an apartment, a villa or any unit, built under the PDS regime gives the right to a residence permit, if the price of the property is at least 375,000 USD (+ 5% registration fee).
There are also PDS for Seniors plans, created for foreign investors over the age of 50 who want to live out their retirement. This category of investors and their spouses or partners can apply for a residence permit for retirees, which is valid for ten years but conditionally renewable, and benefit from a tax exemption for five years.
Become a resident of Mauritius by investing in an IHS
The Invest Hotel Scheme property consists of the purchase of an independent room, suite or villa within a hotel development project, with no minimum price. For a minimum investment of $500,000 (+ $70,000 registration fee), the purchaser (the investor in person, a locally incorporated company, a limited partnership, a trust, or a locally established and registered foundation) can purchase a free-standing villa. He or any person of his choice can in the property 45 days per year. The rest of the time, it is rented by the hotelier and the rental income is paid back to the investor.
Become a resident in Mauritius by investing in a Smart City
This smart, self-sufficient, sustainable and innovative city is focused on the concept of work, life and leisure. By investing at least 375,000 USD for the purchase of a luxury property, the buyer benefits from a wide range of tax and non-tax incentives to investors, investment opportunities in urban development.