Investing in a property as an expat in Mauritius

Mauritius offers you the opportunity of living a dream life close to the ocean and nature. While the North,West and Centre are favoured for their commercial and educational facilities, the South and East offer an authentic lifestyle, closer to nature. Let's have an overview of property acquisition in Mauritius. 

In Mauritius, private transactions between individuals are very rare. While there are online platforms for real estate listings, they feature listings exclusively from agencies. Therefore, you will work with an agency that will guide you throughout the entire process, from discovering the most suitable options to signing the contract, and occasionally even providing assistance beyond that, ensuring a smooth transition during your relocation to Mauritius.

Investing in property: tax and residence

Investing in real estate in Mauritius offers a multitude of financial advantages. These include exemption from property taxes, inheritance taxes, and succession duties based on the tax residence of the heirs. The property is not included in the calculation of the French IFI tax. There is no capital gains tax, and rental income is taxed on brackets ranging from 0 to 20%. Additionally, the rental yield can reach up to 8%. There are no restrictions on repatriating funds from property resale or rental income. 

In order to promote foreign investment in real estate, the government of Mauritius has implemented various programs to regulate property acquisitions. While certain schemes offer more affordable options, an investment of at least $375,000 grants you a residence permit for your entire family, including dependent children without any age restrictions. Moreover, both you and your spouse will be authorised to work. Additionally, you can take advantage of a double taxation avoidance agreement that has been signed with over 40 countries, including France, the United Kingdom, Germany, Russia, and South Africa.

For individuals over 50 and their families, a residence permit is granted for the acquisition of a property in a PDS as part of a senior housing project, considering a purchase price of over $200,000. 

A foreigner holding a residence permit or a work permit may acquire only one residential property outside a planned property program, provided that the property does not exceed 1.25 acres and is not located on State land. The purchase price must exceed $500,000 and an additional registration fee of 10% will be required.

Who can invest in property?

Foreign nationals, companies registered under the Companies Act 2001, Real Estate Investment Companies registered with the Registrar of Companies, Limited Partnerships and Trusts have access to the programmes defined next.

Overview of property developments

• IRS developments (Integrated Resort Scheme) are upmarket developments with a minimum investment of $500,000. They offer amenities such as golf courses, marinas, wellness centres and various services. ‍
• RES developments (Real Estate Scheme) are high-end residential developments with no minimum investment.‍
• Property Development Schemes (PDS) are luxury residential developments (villas, duplexes and flats) on freehold land. They offer caretaking, maintenance and security services, as well as high-quality commercial and leisure facilities.‍
• Smart City schemes are areas designed around the concept of "living, working and playing". Foreigners can buy villas, duplexes and flats, as well as offices. Companies can acquire commercial land and benefit from numerous tax advantages.‍
• The R+2 scheme allows investments in residences of at least two storeys, located outside residential complexes, for a minimum of 6 million rupees (around $133,000). ‍
• The Invest Hotel Scheme (IHS) allows the acquisition of a hotel unit or a room in an approved hotel, thus offering all the infrastructures available. The investor or any person acting on his behalf may reside there for a maximum of 45 days in any 12-month period and receive income through a rental agreement.
  

IRS, PDS and RES investments can be made on a VEFA (Vente en Etat de Futur Achèvement). Also known as sale of property off-plan, this option is available to foreigners. The deed of sale is drawn up by a notary and offers the buyer a number of guarantees provided by the developer, including a completion or repayment guarantee, a ten-year guarantee and damage-work insurance, while also offering payment in instalments.

The costs associated with purchasing a property include notary fees, which amount to around 1% of the value of the property and are subject to 15% VAT, a 5% government tax, an EDB processing fee of Rs25,000 (around USD 500) and agency fees. 

Steps involved in purchasing a property

Investing in a property in Mauritius requires signing a reservation contract, obtaining approval from the Economic Development Board (EDB), making a deposit payment into an escrow account opened in the buyer's name at the notary's office, drafting the notarial deed, conducting the final signing of the deed of sale prepared by the notary, receiving the keys, and ensuring the completion guarantee.

Considering the multitude of benefits Mauritius provides when it comes to property acquisition, it is no wonder that this sun-soaked haven ranks among the world's top destinations for expatriates seeking as island lifestyle.