MAURITIUS COMPANY FORMATION

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MAURITIUS GLOBAL BUSINESS COMPANY – GBC1 AND GBC2

MAURITIUS COMPANY FORMATION – GBC1

GBC1 companies fall under the Companies Act 2001 and their licensing is done by the Mauritius Financial Services Commission. Due to taxation purposes, it is required that the companies should be residents in Mauritius. Further, the residence of the companies in Mauritius provides them a chance to benefit from the double taxation avoidance treaty. This is as long as the companies have a Tax Residence Certificate that is issued by the MRA (Mauritius Revenue Authority).

There are a set of conditions that companies need to fulfill so that they are issued with a GBC1 License by the Mauritius Financial Services Commission. The company:

  • Shall have not less than 2 Mauritius resident directors;
  • Shall operate its principal account in Mauritius at all times;
  • Shall  ensure that it keeps and maintains  its records of account  at its Mauritius registered office;
  • Shall  prepare  its statutory financial  statements and have  the statements  audited in Mauritius;
  • Shall provide for all directors’ meetings to have not less than 2 directors from Mauritius.

Despite the fact that these companies are subject to Mauritian tax, they still benefit from a very low tax rate of a maximum of 3% and tax credits. Over the years, GBC1 companies have been mainly used by foreign businesses to establish investments and projects in countries that constitute Mauritian double tax avoidance treaty partners. These countries include India, China, Thailand, South Africa, Rwanda, Italy and Luxembourg. In addition to this, the companies may also be used for provision of financial services, a strategy that may necessitate the need for additional taxation.

 

GBC1 COMPANY KEY BENEFITS

GBC1 Companies are viewed as tax residents and are therefore required to pay income taxes. Due to this tax paying liability, the companies are also eligible to benefit from the Mauritian Double Tax Treaties. A GBC1 can either be a foreign company branch or be a local company in Mauritius. The companies should transact all their dealings in foreign currency and not in the Mauritian business sector.

  • International operation of businesses;
  • GBC1 Companies are entitled to benefit from the Mauritian Double Tax Treaties. The treaty has gained root in India as Mauritius is fast becoming a holding destination for companies in India;
  • GBC1 companies can make use unilateral foreign tax credit that is 80% of Mauritian Tax Rate. The credit gives a 20% Mauritian rate residual liability that translates to about 3%.There are ongoing strategies on reducing the rate further;
  • Exemption from Capital Gains or tax withholds;
  • Limitless tax losses carrying forward;
  • Dividends, redemption proceeds payments, interests and royalties exempted from tax withhold;
  • Entitlement to benefiting from dividend underlying tax credits in companies that have more than 5% shareholding in Investee Company(s);
  • Account interests from Mauritian   bank deposits are exempted from taxation;
  • Taxes on inheritance, gifts and estates do not apply;
  • Exclusion of stamp and registrar duties/ levies;
  • A foreign company branch may also benefit from the tax treaty network if the branch satisfies that’s its effective management and overall control is based in Mauritius.
 

GBC1 TAXES

Companies under 1st Category Global Business License must pay a fixed annual licence fee of USD 1,750 and a one-off licence application fee of USD 500 to the Financial Services Commission and USD 250 on incorporation and then annually to the Mauritius Registrar of Companies.

Such companies under the 1st category nosiness license are considered tax residents in Mauritius and are not subject to any capital gains taxes or withholding taxes on dividends, interest and royalties received from Companies under the same business license. Also no stamp duties or capital gain taxes are imposed.

Category 1 Global Business License companies are to a corporate tax at a rate of 15%. Tax sparing credits are available.

 

GBC1 COMPANY CORPORATE AND LEGAL FEATURES

DIRECTORS

  • At least 2 Mauritian directors for DTAs access purposes;
  • The confidentiality of records should be upheld;
  • Chairing of meetings should be done from Mauritius to make DTAs available.

SECRETARY

Management Company to undertake roles and responsibilities of company secretary.

SHAREHOLDERS (MEMBERS)

  • At least one shareholder;
  • Corporate shareholders allowed;
  • Optional local shareholder (not a must to have a local shareholder);
  • Meetings can be held anywhere;
  • Records should be confidential;
  • Bearer shares not allowed.

BENEFICIAL OWNERS (CLIENTS)

  • Beneficial owner’s records should be confidential;
  • Nominees allowed to hold shares for beneficial owner clients.

SECRETARY

Management Company to undertake roles and responsibilities of company secretary.

ACCOUNTS AND RETURNS

  • Accounts to be audited and filed annually;
  • Records should be publicly inaccessible;
  • Exemption of annual company return filing.

CONFIDENTIALITY

The confidentiality of records of directors, shareholders or beneficial owners should be upheld always. This implies that the documents are not publicly accessible.

 

MAURITIUS COMPANY FORMATION – GBC2

GBC2 Companies are listed as private business entitles that transact business in other countries other than Mauritius. A GBC2 Company can either be a registered branch of a foreign company or a company that is locally incorporated in Mauritius. Confidentiality    is of great help as far as GBC2 companies are concerned. These companies provide a great avenue for holding and management purposes of private property.

  • Investment holding;
  • Holding property such as real estate property or other immovable properties;
  • Protection of wealth;
  • Global (international) trade;
  • Non financial  consultancy services;
  • E–commerce purposes.
 

GBC2 COMPANY KEY BENEFITS

GBC2 Companies are listed as private business entitles that transact business in other countries other than Mauritius. A GBC2 Company can either be a registered branch of a foreign company or a company that is locally incorporated in Mauritius. Confidentiality is of great help as far as GBC2 companies are concerned. These companies provide a great avenue for holding and management purposes of private property.

  • Unique privacy protection mainly by using nominee directors and shareholders;
  • No local nominee required in establishment of the company thus it can  be fully owned by foreigners;
  • The establishment of the companies necessitate for only one director and one shareholder;
  • Companies benefit from legal tax exemption despite being unable to access Mauritian Double Taxation Treaty;
  • Cheap maintenance as no accounting and reporting required;
  • Not tax withholds on dividends;
  • Capital Gains are not taxed;
  • Easy share transfer as stamp duties are abolished;
  • Shareholders and Directors are free to meet anywhere;
  • Easy to convert to GBC1;
  • GBC2 Companies require having a registered office and agent in Mauritius;
  • Easy to migrate from a foreign company either to or from Mauritius;
  • Repatriation of earnings is free.
 

GBC2 TAXES

A Company holding a 2nd Category Global Business License does not pay any tax in Mauritius for its world-wide profits.

  • Minimum Annual Tax / Licence Fee US$235;
  • Annual Return Filing Fee US$65.
 

GBC2 COMPANY CORPORATE & LEGAL FEATURES

NAME RESTRICTIONS

Any name which is identical or similar to an already registered company or any name that suggests the patronage of the President or the Government of Mauritius.

DIRECTORS

  • At least one director;
  • Corporate directors allowed;
  • Local director not a must;
  • Directors’ records need to be confidential;
  • Meetings of directors can be held in any place.

SHAREHOLDERS (MEMBERS)

  • At least 1 shareholder;
  • Corporate shareholders allowed;
  • Local shareholder not a must;
  • Meetings of shareholders are free to be held in any place;
  • Shareholders’ records need to be confidential.

BENEFICIAL OWNERS (CLIENTS)

  • Clients’ records should be confidential;
  • Nominees may hold shares on behalf of the client.

SECRETARY

  • Optional to appoint Company Secretary.

SHARE CAPITAL

  • Unrestricted share issuance. Companies Act 2001 abolished authorized share capital concept;
  • US$1 Standard Minimum Paid up Capital;
  • Standard currencies used USD, GBP or EURO;
  • Other currencies used  except Mauritian Rupees.

CONFIDENTIALITY

Public access of records of directors, shareholders or clients/ beneficial owners not permitted.