Mauritius Rental Income Guide 2026

Overview — Rental Income Taxation

Rental income from immovable property (land and buildings) is treated as investment income and is subject to Mauritius personal income tax (IIT) at the flat rate of 15%. The income is aggregated with all other sources of income (employment, business, investment) and the personal allowance of MUR 390,000 is applied before calculating tax. Rental losses can offset other income sources.

Gross Rental Income

Gross rental income includes all amounts received or receivable from tenants, including:

• Monthly or annual rent payments
• Service charges and maintenance fees (if passed to tenants)
• Parking fees or other ancillary charges
• Lease premiums or key money
• Utilities recovered from tenants (if not separately metered)

Rental income is reported on a receipts basis for cash-basis taxpayers, or on an accruals basis for businesses. Most individual landlords use the receipts basis.

Allowable Deductions

The following expenses can be deducted from gross rental income to arrive at net rental income:

• Mortgage interest: Interest on loans used to purchase, improve, or maintain the rental property
• Repairs and maintenance: Costs of maintaining the property in its current condition (not improvements)
• Property insurance: Premiums for building and liability insurance
• Property management fees: Fees paid to managing agents or property companies
• Depreciation: Capital cost allowance on the building (typically 2–4% per year on cost)
• Utilities: Water, electricity, and other utilities if paid by the landlord
• Legal and professional fees: Costs related to tenant disputes, lease preparation, and tax compliance
• Local authority rates: Annual land tax paid to municipalities

Net Rental Income Calculation

Net rental income = Gross rental income - Allowable deductions. This net amount is added to the taxpayer's other income sources. The total chargeable income (after personal allowance) is taxed at 15% (or 10% for pensioners). If the net rental income is negative (a rental loss), the loss can offset other income sources (such as salary or business profits), reducing the overall tax liability. Unused rental losses can be carried forward to future years.

Reporting Requirements

Rental income must be reported in the annual tax return (Form 1) filed by 30 September each year. Landlords should maintain records of all rental income and expenses, including tenancy agreements, rent receipts, invoices for expenses, and mortgage statements. The MRA may request supporting documentation for deductions claimed. Failure to declare rental income is a common area of MRA enforcement, and penalties apply for non-disclosure.

VAT on Rental Income

Residential rental is generally exempt from VAT. Commercial rental (office, retail, industrial) may be subject to VAT at 15% if the landlord is a registered VAT taxpayer and the turnover from commercial rentals (together with other taxable turnover) exceeds the MUR 6 million threshold. Landlords should check their VAT registration status with the MRA.

FAQs

Is rental income subject to PAYE or withholding tax?

No, rental income is not subject to PAYE or withholding tax. The landlord is responsible for declaring the rental income in their annual tax return and paying the tax due. However, if the tenant is a company, there is no requirement for the company to withhold tax on rent (unlike some other jurisdictions).

Can I deduct the full purchase cost of a rental property?

No, the purchase cost of a rental property is a capital expenditure and is not deductible as an expense. However, you can claim depreciation (capital allowance) on the building over its useful life. Land is not depreciable.

What if I rent a property partially for residential and partially for commercial use?

You should apportion income and expenses between the residential and commercial portions. The residential portion remains exempt from VAT, while the commercial portion may be subject to VAT if you are registered. Expenses should be allocated on a reasonable basis (e.g., floor area).

Disclaimer

This guide provides general information about Mauritian rental income taxation for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Mauritian tax advisor or the MRA directly for advice specific to your situation. InvestmentKit does not provide tax advice.