Post-Registration Company Compliances in Mauritius- An Overview The division of companies is based on the annual turnover generated by a company. Thus, companies are segregated into small, medium-sized and large companies. A small company is an enterprise whose annual turnover is not more than MUR 10,000,000. A medium-sized enterprise is one whose annual turnover is more than MUR 10,000,000 and not more than MUR 50,000,000. Large enterprises are those whose annual turnover is more than MUR 50,000,000. There are two types of entities that are preferred by foreign investors and companies to set up a business in Mauritius. These are the two types of offshore companies, viz. Global Business Corporations and Authorised Companies. The main difference between a Global Business Corporation and an Authorised Company is that the former is allowed to do business both within and without the boundaries of Mauritius, i.e. they can conduct business abroad and within the Mauritian territory. On the other hand, an Authorised Company is only permitted to do business abroad, i.e. it can only serve customers outside of Mauritius and is not permitted to carry out commercial activities within the jurisdiction of Mauritius. This is the reason why the most preferred form of business entity in Mauritius for foreign investors is the Global Business Corporation. Enterslice advises and assists in preparing a compliance calendar that records all the statutory filings and disclosures to be made by your Mauritian company to ensure that your company always stays on the right side of the law. The annual returns are required to be filed along with the applicable fee to the respective state departments. Major Post-Registration Company Compliances in Mauritius The major statutes governing post-registration company compliances in Mauritius are governed by the Companies Act of 2001; the Financial Services Act of 2007; the Income Tax Act of 1995; the Financial Reporting Act of 2004, and other applicable provisions: Submission of an Annual Financial Statements The Companies Act of 2001 specifies that every financial statement of the company should be reliable and correctly reflect and explain all the financial transactions of the company. These financial statements should reflect the financial position of the company at any time of the reporting year, comply with the legislation and ensure that proper quality audit of large companies take place. It is also mandatory to keep reporting materials in Mauritius only unless the directors of the company have agreed otherwise. An Authorised company is mandated to keep the records of its financial transactions and keep the supporting necessary papers at the registered agent’s address and file the following statements annually: A financial summary with the Financial Services Commission; and An annual tax return with the Mauritius Revenue Authority. On the other hand, a Global Business Corporation is not only required to maintain and keep the financial statements in full and not in the simplified form. A GBC is not only supposed to file the annual financial statements but also an auditor’s opinion on the financial statements with the Financial Services Commission of Mauritius. A GBC is also supposed to submit the annual tax returns to the Mauritius Revenue Authority. Liability for late filing of accounts and late payment of taxes An administrative penalty is levied on those offshore companies for late filing of the accounts. The administrative penalties charged for every workday are USD 10 for both Global Business Corporations and Authorised Companies. The maximum amount of administrative penalty that can be levied for late filing of accounts is as follows: A maximum amount of MUR 150,000 since 1st January 2018 For unpaid amounts on 31st December 2017: up to MUR 150,000 – actual amount payable over MUR 150,000 – MUR 150,000 plus one-third of the rest of the amount. Penalty for late filing of annual income tax returns: Every person who must file a tax return and fails to submit the same is imposed with a penalty of MUR 2,000 per month until the tax return is filed, but it will not be more than MUR 20,000. However, if the person is a small enterprise with an annual turnover not exceeding the amount of MUR 10,000,000 or an individual who is not engaged in the business, the penalty is charged at 5% of the amount. Penalty for late payment of tax: 5% of the tax amount charged. However, if the entity is a small enterprise with an annual turnover not exceeding the amount of MUR 10,000,000 or an individual who is not engaged in the business, the penalty is charged at 2% of the amount. Changes in the directors, constitution, authorised agent etc. In case of any changes in the constitution of the company, its directors or authorised agents, or their registered offices, addresses and name, the notification of such change shall be made to the Registrar of Companies within a period of 1 month from the date of such change. Reporting of a Foreign company Every foreign company has to submit a copy of its last accounts to the Registrar within a period of 3 months from its last annual meeting of shareholders. Such companies are also required to submit a copy of their last financial statements of their local branches within a period of 6 months from the end of the accounting period. In case a foreign company ceases to have a place of business in Mauritius, it must file a notice with the Registrar to that effect within a period of 7 days from the date of such cessation. Holding Annual General Meetings Every company in Mauritius is required to hold an annual general meeting of its shareholders at least once in each calendar year within a period of 6 months from the date of filing the balance sheet of the company and not later than 15 months from the previous annual general meeting. A company is permitted not to hold the annual general meeting in the first calendar year of its incorporation. However, the first annual general meeting of the shareholders should be held within a period of 18 months from the date of incorporation of the company in Mauritius. Maintenance of Statutory Registers and Records It is mandatory for all the companies in Mauritius to maintain certain statutory registers or records such as share registers, accounting records and company records, with the exception of companies registered under global business corporations. The share registers should maintain the records of the shares issued by the company and specify any restrictions or limitations on the transfer of shares that exist in the constitution of the company or the terms of the issue of the shares. If the constitution of the company permits, then the company can keep copies of its share registers at different locations. However, the principal register shall be kept in Mauritius only. Apart from the share register, the company records also include the constitution of the company, register of directors (and if required, then interests of the directors), minutes of the meetings held and the resolutions passed at the directors and shareholders meetings in the past seven years. Audit Requirements All the companies in Mauritius are required to prepare and maintain their financial statements in accordance with the International Financial Reporting Standards (IFRS). However, small private limited companies and Authorised companies have been exempted from preparing the full records of financial statements according to IFRS. Instead, they have to prepare a financial summary of their accounts which includes the statement of financial position and the statement of comprehensive income. The Board of every company has to ensure that within a period of 6 months of the preparation of the balance sheet of a company, the financial statements should be dated and signed on behalf of the Board of Directors by at least 2 directors or where there is only one director with the company, by that director alone. All the companies, except for the small private companies, have to submit a copy of the financial statements of the company and group financial statements within a period of 28 from the date of their preparation. These necessary papers must be signed, and copies of these statements, along with a copy of the auditor’s report on these statements, have to be filed with the Registrar of Companies within a period of 28 days. The companies who are required to file their annual statements and financial summary to the Registrar, must file the information that has been set out in the 9th Schedule of the Companies Act 2001 with the ROC. All the listed companies registered in Mauritius have to furnish a copy of the annual report to the Stock Exchange of Mauritius within a period of 90 days but not later than 6 months from the date of the preparation of the balance sheet. A Global Business Corporation is supposed to file its audited financial statements, whereas an Authorised Company is supposed to file the financial summary of its accounts with the Financial Service Commission. All companies are under an obligation to maintain their financial records and statutory books that accurately represent the financial transactions and financial position of the company. Except for the small private companies and the Authorised companies, all the companies registered in Mauritius have to get their accounts audited by a licensed auditor. The audit requirements have been prescribed under the Financial Reporting Act 2004, laying down that the statutory audits in Mauritius should be carried out in accordance with the International Standards on Audit. Submission of the annual tax returns The fiscal year in Mauritius runs from 1st July- 30th June of the following year. However, it is not a mandatory window, and the companies are free to choose their accounting year, and such a year should not be more than 12 months. The tax administration in Mauritius is governed by the provisions of the Income Tax act of 1995. The Mauritius Revenue Authority (MRA) is the statutory agency that is responsible for the operations, management and enforcement of revenue laws in Mauritius. All the companies in Mauritius are obligated to submit their annual income tax returns and pay the income tax due within a period of 6 months of the accounting year's end. It must be noted that where the accounting year ends in the month of June, the due date for the submission of the tax returns and payment of the tax is 2 days, excluding the public holidays and Sundays before the end of December. Corporate Income Tax is applicable to all the companies, trustees of the unit schemes, trusts and non-resident partnerships on the basis of their residency. The residents are taxed on the basis of worldwide income, and the non-resident entities are taxed on the income generated from Mauritius only. Filing of Advance Payment System (APS) returns Apart from the abovementioned annual returns, a company is also required to file Advance Payment Systems (APS) quarterly returns and pay taxes accordingly. The requirement of APS returns filing is not applicable to those entities whose annual turnover is less than MUR 10,000,000 per year, i.e. small companies. The APS returns, along with the tax payment, are deposited to the Revenue Authority within a period of 3 months from the end of the month in which the APS quarter ends, unless the quarter ends either in the month of March or September. Those companies that have paid their taxes in accordance with the APS are not exempted from the filing of an annual tax return. It must be remembered that tax payment is a preliminary payment. Every company that has paid its taxes according to the APS, has to file its annual tax returns and pay taxes in accordance with the tax return, after deducting the tax already paid in accordance with the APS system or withheld at source (in case of there is a tax deduction). Corporate Social Responsibility (CSR) requirements Every company incorporated in Mauritius, except for global business corporations, is required to set up a CSR fund which is equivalent to 2 per cent of the chargeable income of the company in the preceding year. This fund shall be used to implement an approved programme or to finance an approved NGO. If the company spends less than the prescribed amount earmarked under the fund, the difference of the balance shall be paid by the company to the Mauritius Revenue Authority (MRA) at the time of filing its annual returns. The obligations of maintaining a CSR fund is not applicable to the following entities: A Global Business Corporation An IRS company A bank in respect of income derived from GBC or Non-residents A non-resident society, trustee of a unit trust scheme or trust itself.
The Registrar of Companies of Mauritius, the Mauritius Revenue Authority (MRA), The Financial Services Commission and several others are the statutory agencies where Mauritius registered companies are supposed to submit their annual returns.
All the companies in Mauritius are obligated to submit their annual income tax returns and pay their due taxes within a period of 6 months of the accounting year’s end.
Every company incorporated in Mauritius, except for global business corporations, an IRS company, non-resident societies and trust schemes, is required to set up a CSR fund which is equivalent to 2 per cent of the chargeable income of the company in the preceding year.
Every company in Mauritius is required to hold an annual general meeting of its shareholders at least once in each calendar year within a period of 6 months from the date of filing the balance sheet of the company and not later than 15 months from the previous annual general meeting. The first annual general meeting of the shareholders should be held within a period of 18 months from the date of incorporation of the company in Mauritius.
Every foreign company has to submit a copy of its last accounts to the Registrar within a period of 3 months from its last annual meeting of shareholders. Such companies are also required to submit a copy of their last financial statements of their local branches within a period of 6 months from the end of the accounting period.
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