A closed-end fund (CEF) can be established in Mauritius to raise a fixed amount of capital mainly outside of Mauritius through an initial public offering and subsequent closings or as private placements for the purpose of investing in a portfolio of securities, or other financial assets, real estate property or non-financial assets approved by the FSC.
A fund incorporated as a Global Business Company benefits from preferential rates available under Double Taxation Avoidance Agreements Mauritius has signed with 44 countries.
A CEF that makes a takeover offer by way of an exchange of securities or whose securities are listed on a securities exchange in Mauritius or has not less than 100 participants is subject to the reporting issuer disclosure requirements.
A CEF can also qualify as a Special Purpose Fund (SPF). The SPF is a tax-exempt entity set up as non-resident in Mauritius under the Financial Services Act to invest solely in countries that do not have treaty benefits with Mauritius. It is advisable to perform a tax and cost-benefits analysis when considering an SPF as besides being not entitled to tax treaty benefits with treaty countries, the SPF must invest primarily in tax-exempt securities and all investors shall be pension schemes or entitled to tax exemption.
SPF can also invest in Mauritius while enjoying the benefit of being tax-exempt.
Claim foreign tax credit on withholding tax suffered on foreign-source income
Opportunity to further reduce the 3% tax rate.
No capital gains tax and withholding taxes on distribution in Mauritius.
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