MAURITIUS Law and Practice Contributed by: Fayaz Hajee Abdoula, Yashna Munbauhal and Yojna Beesoon, BLC Robert & Associates
4.5 Challenges to Related-Party Limited Risk Distribution Arrangements Related-party limited-risk distribution arrangements are subject to the arm’s length principle. 4.6 Local Transfer Pricing Rules and OECD Standards See 4.4 Transfer Pricing Issues . The local authorities are working towards implementing the OECD stand - ards. 4.7 Transfer Pricing Disputes and Mutual Agreement Procedures Following the Finance Act 2025, Section 75 of the Income Tax Act 1995 has been amended to require companies engaging in transactions within its scope to prepare and keep records as may be prescribed. Mauritius is preparing transfer pricing regulations at the present time. There are no known international transfer pricing dis - putes being resolved through Mauritius’ double tax treaties and mutual agreement procedures (MAPs). The local tax authorities have issued guidance notes on how taxpayers can request assistance from the competent authority in Mauritius to resolve disputes arising from taxation not in accordance with the rel - evant double taxation avoidance agreements. The International Taxation Section of the Large Taxpay - ers Department of the MRA is the unit responsible for providing assistance with respect to MAPs. 5. Taxation of Non-Local Corporations 5.1 Compensating Adjustments There is no applicable information in this jurisdiction. 5.2 Local Branches and Local Subsidiaries Local branches of non-local corporations are gener - ally taxed on the income attributable to their Mauritian operations, whereas local subsidiaries of non-local corporations are subject to tax on their worldwide income. Both type of entities are taxed at a rate of 15%, with available credits and exemptions applied where relevant.
dents are subject to a withholding tax of 15%. Royal - ties payable to non-residents by a company out of its foreign source income are not subject to withholding taxes. The local tax authority is known to enforce the legal provisions on withholding taxes. 4.2 Key Treaty Jurisdictions for Inbound Investment Mauritius is a party to some 46 double taxation avoid - ance agreements. The primary tax-treaty countries in this regard are India, the People’s Republic of China, Singapore, South Africa and the United Kingdom. Mauritius is also a party to a series of such agree - ments that await ratification or signature, or are still being negotiated. 4.3 Tax Authority Scrutiny of “Treaty Shopping” Practices Mauritius authorities do not usually challenge the use of treaties. However, it is to be noted that treaty ben - efits may not be allowed upon the application of the “principal purpose test” under the Multilateral Con - vention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the “Multi - lateral Convention”). 4.4 Transfer Pricing Issues for Inbound Investors There is no specific transfer pricing legislation or guid - ance from the tax authorities in Mauritius, although Section 75 of the Income Tax Act 1995 sets out a requirement for transactions between related parties to be conducted on an arm’s length basis, meaning that the terms and pricing should be comparable to those that would have been agreed between inde - pendent parties under similar circumstances. There is no presumption in Mauritius that the arm’s length principle should not apply to non-related par - ties, effectively meaning that all transactions must be conducted on an arm’s length basis in Mauritius. Companies engaging in such transactions will need to prepare and keep records as may be prescribed.
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