Foundation in Mauritius

What is a Foundation?

With the establishment of the Foundation Act 2012, Mauritius added Foundations to its list of wealth management structures available to choose from.

A Foundation is a hybrid legal entity combining the features of a Trust and a Company. Its legal structure and functions are similar to those of a Trust, but is administered as a Company. Foundations are interesting to clients who may be unfamiliar with the concept of Trusts, particularly in civil law countries.

A Foundation in Mauritius can be used for:

• Charitable or non-charitable causes;
• Estate planning and succession planning;
• Asset Protection;
• Private wealth management;
• Tax planning;
• Pension schemes;
• Housing intellectual property; and
• Holding assets such as real estate (commercial or residential); shares in companies, funds, unit trusts, investments, and insurance policies amongst others.

Why choose to set up a Foundation in Mauritius?

Mauritius is one of the leading jurisdictions for corporate as well as personal structuring in Africa. Indeed, the country ranks 1^st on the continent for ease of doing business, is an internationally compliant, cost-effective, and transparent jurisdiction, ideal for private wealth management.

Foundations in Mauritius may apply for a Global Business Company Licence if they want to fall under the supervision of the Financial Services Commission (FSC) and become tax resident. It therefore has access to the wide network of Double Tax Agreements (DTA) and Investment Promotion and Protection Agreements (IPPA) Mauritius has with other countries. Holding a Global Business Company Licence for a Foundation in Mauritius may entitle the latter to benefit from an 80% Partial Exemption Regime on specified sources of income (interest, dividend, etc.), provided it meets the substance requirements.

Other advantages of setting up a Mauritius Foundation include:

• Charitable Foundations are automatically tax exempted;
• Benefit from the network of DTA through tax-resident status;
• Foundations currently set up in other jurisdictions can re-domicile to Mauritius;
• A Foundation in Mauritius can also re-domicile elsewhere;
• Members of the Foundation council are not liable to the Beneficiaries.

A Foundation registered or having its Central Management and Control (CMC) in Mauritius is considered to be Mauritius resident and is liable to a 15% income tax on its chargeable (worldwide) income. A Foundation would have its Central Management and Control in Mauritius if:

• The founder is resident in Mauritius; and
• A majority of the beneficiaries appointed under the terms of a charter or will are resident in Mauritius.

Otherwise, a Foundation that has its CMC outside of Mauritius will not be subject to tax on its foreign source income in Mauritius. However, the non-resident Foundation will need to file an income tax return in order to declare and pay income tax (15%) on its Mauritius sourced income.

Related articles:

• Setting up a company and doing business in Mauritius
• Relocate to Mauritius: the ideal place to live and do business
• The Mauritius Trust: a powerful tool for wealth structuring and succession planning

Uses of a Mauritius Foundation

A Foundation may be used for:

• Charitable non-charitable (commercial) purposes, or both – many jurisdictions do not allow Foundations that have commercial objectives to operate; and
• The benefit of a person or a class of persons, to carry out a purpose, or both.

Mauritius Foundations are an alternative to Trusts and Private Trust Companies for High-Net-Worth clients willing to stay in charge of their assets while decreasing the annual cost of their structures. A Foundation is one of the preferred private structures used by High Net-Worth Individuals to cater for their succession planning and inheritance planning, private wealth management, limited liability status and asset-holding strategies.

Setting up a Mauritius Foundation, a reputable offshore jurisdiction, can provide numerous advantages to a Founder as well as Beneficiaries.

How we can help you in setting up your Foundation in Mauritius

Sunibel forms part of a strong and growing network of international partners, originating in Switzerland, with over 40 years of experience, operating in the fields of business and finance at international level. As a duly licenced Management Company, we accompany you to set up your Foundation in Mauritius, Africa’s leading International Financial Centre. Our services include:

• Understanding your needs if the setting up of a Foundation in Mauritius is right for you;
• Provision of Members of the Council;
• Drafting of Foundation Charter and other related documents;
• Provision of accounting and tax compliance services; and
• Provision of qualified Company Secretary services.

• Setting up and register a company in Mauritius
• Relocate to Mauritius: the ideal place to do business and live
• Setting up a Trust in Mauritius

Disclaimer

This article is provided for information purposes only. It is not intended to provide, and should not be used for, tax or legal advice. We may put you in contact with tax and legal advisers in this regard.

Although all information and opinions contained herein have been compiled from sources believed to be reliable and trustworthy, no representation or warranty, express or implied, is made as to their accuracy or completeness, and, to the extent permitted by law, Sunibel Corporate Services Ltd, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in the article or for any decision based on it. You should not act upon the information contained in this publication without obtaining specific professional advice.

Sunibel Corporate Services Ltd accepts no liability for any direct or indirect damage resulting from the use and reliance on the information published in this article.

For more information, please see our terms and conditions.