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How to Register a Mauritius Trust 

by | Apr 19, 2022 | Corporate Structuring, Wealth Management

Trust formation process in Mauritius

Trusts registered in Mauritius are governed by The Trust Act of 2001. A trust formed under this act has the following features:

  • It can be set up by a Mauritius resident or non-resident. 
  • Owners of a Mauritius trust are not required to register with any registrar. 
  • Known as a flexible vehicle which can take various forms, including family trust, discretionary trust, life interest trust, charitable trust, purpose trust, protective trust, or protective asset trust. 
  • A standard trust must have a protector while a purpose trust in Mauritius must have an enforcer. 
  • A trust can have a managing trustee located in Mauritius and a custodian trustee located in another jurisdiction.
  • Forced heirship rules of other jurisdictions cannot be enforced by the courts in Mauritius. 

Trust Registration Process in Mauritius

A trust in Mauritius may be established in various ways:

  • Disposition of property either between living persons or by the terms of a will.
  • Declaration of the trustee that he or she is holding the property on trust. 

In order for a trust to be valid, it must be clearly stated on a deed, stating the following:

  • Trustee name
  • Intention of settlor in the creation of a trust or a declaration by the trustee that he holds the property on trust
  • Object or beneficiaries of a trust
  • Property transferred or held on trust
  • Trust duration

With the exception of the approval of the Prime Minister, trust property may not include immovable property in Mauritius or in the case where the beneficial interest is held by a non-citizen. 

Confidentiality of Mauritius Trust 

  • There are no trust registers in Mauritius. 
  • There is no need for any disclosure of beneficial owner to any authority. 
  • A trustee must keep all information concerning a trust highly confidential. 
  • Under certain circumstances, a trustee may be required to provide confidential information to an authorized body or authorized persons under anti-money laundering, terrorism prevention, and corruption legislation or under the Financial Services Act of 2007. 

Trust Registration Process in Mauritius

Asset Protection Features

The legislation on asset protection includes the following:

  • In the absence of intent to defraud, a Mauritius trust must not be void or voidable as a result of a subsequent bankruptcy of the settlor nor actions taken against the settlor by his or her creditors. 
  • When a creditor has been proven beyond reasonable doubt that the trust was created to defraud creditors of the settlor, the court may declare a trust to be void or voidable. 
  • Not action can be brought more than two years from the transfer of assets into a Mauritius trust. 

Purpose of a Mauritius Trust 

  • A Mauritius trust may be created for a reason, notwithstanding the absence of a beneficiary. 
  • Purpose of trust formation must be specific, capable, and reasonable of fulfillment and may not be unlawful, immoral, or against public policy. 
  • A purpose trust must have an enforcer capable of enforcing all terms of the trust. 
  • Instrument creating the trust must provide for the disposition of the assets upon termination. 

Taxation Regime for Mauritius Trusts

  • A Mauritius trust with non-resident settlors and beneficiaries are exempt from tax if an election was made. 
  • A Mauritius trust is exempt from trust if no election was made at an effective rate of 3% of net income after deduction of expenses unless an election is made to be deemed non-resident, and therefore, be exempt of tax. 
  • Tax-paying trusts can enjoy the benefits of Mauritius’s favorable tax treaties with other countries. 
  • Trusts for Mauritius residents are taxable at 15% of their net income after deduction for expenses. 

Migration of Mauritius Trusts

  • Trusts created in other jurisdictions can be migrated to Mauritius for tax purposes, given the majority of trustees are Mauritius residents and central administration will be held in Mauritius. 
  • Depending on the terms of the original trust, the proper provisions of the trust can be amended to that of Mauritius by a simple declaration by the trustees in the deed of appointment and retirement. 

Qualified Trustee for Mauritius Trusts 

Settlor for Mauritius Trusts 

  • Any person that carries a legal capacity to contract may create a trust.
  • A settlor may be a trustee, beneficiary, protector, or enforcer of a Mauritius trust but may not be the sole beneficiary. 

Beneficiaries of a Mauritius Trust

  • Beneficiaries of a Mauritius must be identifiable by name or ascertainable by reference to a class of persons or by relationship to another person. 
  • The terms of a trust may provide for the addition of other beneficiaries. 

Duration of a Mauritius Trust 

  • The trust term or period cannot exceed more than 99 years except in the case of a charitable trust where it may be of perpetual duration. 
  • In the case of a non-charitable purpose, the duration must not exceed 25 years. 

Mauritius Charitable Trusts 

A specific form of purpose trust is the charitable trust. To be considered a charitable trust, it must have exclusive object for one or more of the following purposes:

  • Poverty relief
  • Educational advancement
  • Religious advancement 
  • Environmental protection 
  • Any other purpose that benefits the general public

Provided a trust’s objectives is one or more of the purposes above, it will still be charitable if:

  • It is a discretionary trust
  • The terms may be amended or terminated
  • Trustees have the power to defer benefits distribution 
  • Charitable objects are based in Mauritius

Forced Heirship of Mauritius Trusts 

The Mauritius Civil Code has been amended to ensure that forced heirship provisions are only applicable to trusts established in Mauritius or those relating to property located in Mauritius and subject to Mauritius national laws. 

What makes Damalion stand out from other business consulting firms is that we provide comprehensive solutions to our clients. We offer a wide range of consulting services in trust formation for various domiciles including Mauritius. Utilizing our global service network, we bring meaningful connections between clients and skilled service providers that handle legal, accounting, and other associated trust formation services. From opening a bank account, management, tax advice, and more. If you wish to learn more about trust registration in Mauritius and other jurisdictions, reach out to a Damalion expert today. 

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.