Why invest in real estate in Mauritius ?
Published on March 24, 2020
In addition to the quality of life and the beautiful beaches, its political stability and a booming economy, Mauritius does indeed have advantages in terms of real estate investment, and in particular in rental investment.
A foreigner is not allowed to buy on the whole island, but P.D.S (PROPERTY DEVELOPMENT SCHEME) programs are offered and accessible to non-Mauritians.
Property Development Scheme
In this latest investment program, formerly R.E.S & I.R.S, the real estate offered is quality property and often of high standing. In addition, under certain conditions, your investment may also allow you to acquire permanent residence (minimum investment or equal to US $ 500,000) and to designate Mauritius as a tax residence with all the related tax benefits. Thus, you can be domiciled for tax purposes on Mauritian territory with a minimum of 183 days per year with your partner and your children under 24 years old as long as you remain the owner of the property.
P.D.S projects are subject to strict controls, in order to obtain construction authorization. Respectful of the environment, these residences are built in perfect harmony with nature. Indeed, the State encourages ecological constructions : Natural light, photovoltaic panels, water recovery, green spaces, insulation, minimized paved areas, planting of large trees in each of the villas … are all elements that the promoter must integrate into his project.
In addition, the real estate development program must associate real estate with services (e.g. tennis court, weight room, SPA, restaurants, concierge service, garbage collection, maintenance of green spaces …), all secured by an enclosure and a security service.
The future buyer will be able to buy his villa off plan and will benefit from a VEFA guarantee: V.E.F.A is a formula extremely framed by the law, and perfectly secured for the purchaser. It revolves around several stages established by a precise timetable.
The registration tax for the purchase price of a residential property under the PDS regime is 5%. The agency fees and notary fees are around 2% each.
In December 2016, a new program was launched: the Non-Citizens Property Restriction, which allows a foreigner to buy an apartment in Mauritius.
Non-Citizens Property Restriction
Any non-Mauritian citizen, whether or not holding a permanent residence permit or an Occupation permit can buy an apartment. However, certain conditions apply:
The apartments or apartment must be located in a condominium building of at least 2 floors in addition to the ground floor (R + 2) with the prior approval of the Economic Development Board (EDB). To be eligible for this law, the buyer must pay an amount of 6 million rupees (about 155,000 €) or more to buy an apartment.
Non-Double taxation agreement
15% tax only on net profit or personal income. No tax on dividends or capital gains. No social security contributions or property or housing taxes. No inheritance tax, no capital gains tax and no wealth tax either … The Mauritian tax system is one of the most attractive in the world !
Thanks to the tax treaty that exists between France and Mauritius, a principle of non-double taxation has existed in Mauritius since 1982. Thus, all real estate properties acquired on Mauritian territory do not enter into the calculation of the ISF, and their rental returns will only be taxed in Mauritius up to 15%.
Can you rent your P.D.S villa or your apartment?
Your real estate investment can completely be rented in long term or seasonal rentals. For short term rental, there are certain conditions to be met in order to obtain a Tourism Residence Certificate permit. Your net profits will be taxed at 15%.
Smartvillas supports you in your life project in Mauritius until the signing of the deed of sale. Discover our apartments and villas for sale currently on our website
For more information on the PDS or Non-Citizens Property Restriction program: Economic Development Board
Do not hesitate to contact us, benedicte@smartvillas-m.com or marie@smartvillas-m.com