MAURITIUS Law and Practice Contributed by: Fazil Hossenkhan, Nafiisah Jeehoo, Kelly Li and Alicia Kwan Pang, Bowmans
• it carries out its core income-generating activities in Mauritius; • it employs, directly or indirectly, an adequate num - ber of suitably qualified persons to conduct its core income-generating activities; and • it incurs a minimum expenditure proportionate to its level of activities. Alternatively, the fund may claim the foreign tax paid on its foreign source income as credits against the income tax payable in Mauritius – up to a maximum of 15% or 17% (as applicable) – in respect of that income where this can be evidenced (foreign tax credits). If the fund is structured as a limited partnership, the structure will be tax transparent. A partnership that holds a global business licence may opt to be tax- opaque, in which case it will be treated in the same way as a company for tax purposes. A 2% Corporate Climate Responsibility (CCR) Levy has been applicable to companies with a turnover of over MUR50 million since July 2024, with the aim of funding climate change initiatives. This is also payable by limited partnerships opting to be tax transparent. As a result, the effective tax rate for companies ben - efiting from partial exemptions of 80% has increased to 3.4%. The CCR Levy applies only to income (after allowable expenses and deductions). Capital gains are not subject to the CCR Levy. Since 1 July 2025, a new 5% Fair Share Contribution has applied to companies with supplies exceeding MUR24 million and chargeable income exceeding MUR24 million, extending to partnerships, PCC cells, VCCs, foundations and trusts, but excluding global business entities. Currently, the Fair Share Contribu - tion for corporates applies to income derived dur - ing the period 1 July 2025 to 30 June 2028, unless extended by subsequent legislation. 2.5 Loan Origination Mauritius-based funds may originate loans for sub - scription financing and/or leverage. There are current - ly no special rules or regulations governing borrowing for funds categorised as expert funds or professional collective investment schemes. Any borrowing restric -
tions will usually be included in the fund documenta - tion. 2.6 Non-Traditional Assets Funds are expected to invest in a portfolio of “secu - rities”, which includes shares and stocks in share capital, debentures, debenture stocks, loan stocks, bonds, green bonds, convertible bonds or other simi - lar instruments, as well as rights, warrants, options, or interests in connection with the aforesaid securities, securities of a CIS, options, futures, forwards and oth - er derivatives, whether on securities or commodities. Virtual Assets In August 2022, the FSC recognised virtual assets as an asset class suitable for investment by sophisti - cated and expert investors, expert funds, specialised CISs and PCISs. A virtual asset is defined as a digital representation of value that may be digitally traded or transferred and may be used for payment or invest - ment purposes. However, it does not include digital representations of fiat currencies, securities and other financial assets covered by the purview of the Securi - ties Act 2005. Under the Income Tax Act 1995, gains or profits derived from the sale of securities are con - sidered exempt income and a recent amendment to this act has expanded the definition of securities to include virtual assets for the purposes of this provi - sion. Money Market Instruments or Debt Instruments The Securities Act 2005 has recently been amended, enabling Mauritius-based funds to invest in money market instruments or debt instruments including loans, debt obligations or similar instruments. Other Asset Classes Funds may be allowed to invest in other asset class - es, if authorised by the FSC. There is a “specialised” funds regime which allows funds to apply for approval of special asset classes such as debt, digital assets or real estate. Cannabis (other than medical cannabis) is not legal in Mauritius and a fund cannot invest in ille - gal products. There has been a relaxation of the rules relating to medical cannabis, however, and a fund may invest in an investee company importing medi - cal cannabis, provided that the investee company is
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