Republic of Mauritius
Navigating international regulations with confidence
Currency
Mauritian Rupee – MUR/Rs
Official Language
English
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- French
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- French
Fiscal Year
1 Jul - 30 Jun
Payroll Frequency
Weekly, Bi-weekly & Monthly
Tax System and Regulations
Income Tax Structure
Mauritius operates a progressive income tax system for individuals, with a combination of flat and graduated rates depending on income levels. Tax is collected through the Pay As You Earn (PAYE) system for employees, where employers deduct tax at source, and through self-assessment for self-employed individuals. Tax residents who spend at least 183 days in a fiscal year or 270 days or more in aggregate during the current tax year and the two preceding tax years are taxed on their global income, while non-residents are taxed only on Mauritius-sourced income. The system allows for various deductions, exemptions and reliefs, including those for dependents, interest on housing loans, medical insurance, retirement contributions and education expenses. While both residents and non-residents are generally subject to the same income tax rates, residents may benefit from specific reliefs and deductions, such as personal reliefs, which are not available to non-residents.
Payroll Taxes
Payroll taxes include compulsory deductions from employers and employees under the PAYE system and social security contributions such as the Contribution Sociale Généralisée (CSG), National Savings Fund (NSF), Portable Retirement Gratuity Fund (PRGF) and the training levy. Employers contribute 3% of the employee’s monthly basic wage to the CSG, while employees contribute 1.5%. The CSG replaced the National Pension Fund in 2020 and funds pensions and social benefits. Additionally, employers must contribute 2.5% of the employee’s monthly basic wage to the NSF for employee savings, while employees contribute 1% of their monthly basic salary. Employers are also required to contribute 4.5% of an eligible employee’s monthly remuneration to the PRGF, which funds gratuity payments upon retirement, termination or death and is governed by the Workers’ Rights Act, 2019. To support skills development, employers must also pay a 1.5% Human Resource Development Council (HRDC) training levy calculated on the total basic wage bill each month alongside other statutory contributions to the MRA. In addition to monthly payroll deductions, employers must comply with two year-end statutory payments. The End-of-Year Gratuity is a mandatory bonus equal to one-twelfth of an employee’s annual earnings, payable to employees who have completed at least 12 months of continuous service by 31 December. Separately, under the Special Allowance Act 2024, employers must pay a Special Allowance (14th month bonus) equal to one month’s basic salary – pro-rated if applicable – to employees earning MUR 50,000 or less per month.
Tax Reporting and Payment Deadlines
Employers must submit monthly PAYE, social contributions (including CSG and NSF) and the training levy by the end of the following month, with earlier deadlines in May and November, via the MRA’s online platform. The earlier statutory reporting and payment deadlines in May and November are due to the end of the financial periods. The annual PAYE reporting process consists of the Employee Declaration Form (EDF), which must be submitted by the employee to their employer by the end of February each year. The EDF allows employees to select their Income Exemption Threshold (IET) category and declare any dependents or allowable deductions for the upcoming income year starting 1 July. Additionally, employers must issue a Statement of Emoluments (SOE), also known as the Annual Return of Employees’ Emoluments, to each employee and submit it to the MRA by 15 August following the tax year. Employers must report and remit PRGF contributions monthly and submit an annual PRGF return by 15 July. The Special Allowance (14th month bonus) must also be reported to the MRA by the end of the month following payment. While the End-of-Year Gratuity does not require MRA reporting, employers must retain proper records in compliance with labour laws.
Compliance and Record-keeping
Employers and payroll providers are required to maintain accurate and complete payroll records, including employee details, salary information, PAYE deductions, social contributions and tax filings. The records must be kept for a minimum of seven years and be readily available for inspection by the MRA. Compliance with payroll tax obligations is strictly enforced, and failure to submit returns or make payments on time can result in penalties and interest charges. Non-compliance, such as failure to file returns, late payments or providing false information, can result in penalties ranging from Rs 5,000 to Rs 10,000 per month, with cumulative fines reaching up to Rs 120,000, depending on the severity and duration of the breach. The MRA has the authority to audit employers and enforce compliance through inspections and legal action if necessary.
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