Partial Exemption Regime (PER)
A partial exemption system was introduced with effect from 01 January 2019 whereby companies deriving specific types of income may benefit from 80 % tax exemption subject to meeting conditions of substance. The PER only applies if the company carries on its Core Income Generating Activities (“CIGA”) in Mauritius. The CIGA applies to any Mauritian resident company. Therefore, it is also a legal requirement for a Global Business Company. The CIGA applies to the company, notwithstanding the fact that the company may not apply the Partial Exemption Regime. The company carries on its CIGA in Mauritius by:
- employing, directly or indirectly, an adequate number of suitably qualified persons to conduct its CIGA.
- having a minimum expenditure proportionate to its level of activities.
Activities which qualify as CIGA will depend on the business activity of a company. CIGA may include agreeing funding terms, identifying and acquiring assets to be leased, setting the terms and duration of any leasing, monitoring and revising any agreements and managing any risks.
The exemption will be granted to all tax resident companies in Mauritius, except banks, with the following income:
- Income attributable to a foreign permanent establishment which a resident has in a foreign country
- Foreign dividend derived by the company
- Income from Collective Investment Scheme (CIS) / Closed-End Fund (CEF) / CIS Manager / CIS Administrator / Adviser / Asset Manager approved by the Financial Services Commission (FSC).
- Interest income derived by a company other than banks
- Income derived by companies engaged in ship and aircraft leasing other than banks
- Reinsurance / Reinsurance brokering activities.
- Leasing & provision of international fibre capacity.
- Sale, financing, arrangement, asset management of aircraft and its spare parts and aviation advisory services related thereto.