- Legislative trigger and compliance architecture under section 14A
The Mauritian Guide for Foreign Suppliers of Digital and Electronic Services is framed as an administrative exposition of the VAT amendments brought by the Finance Act 2025, whereby a new section 14A has been introduced to bring within the VAT net the supply of digital/electronic services by foreign suppliers to persons in Mauritius. This amendment is effective 1 January 2026. The Guide is “for informational purposes only” and does not override the VAT Act or regulations; however, for a non-resident enterprise, it becomes the practical map of how Mauritius Revenue Authority (“MRA”) expects the law to be implemented including registration, charging, return filing and remittance being the core obligations.
It expressly sets out that foreign suppliers “are required to compulsorily register”, “charge and collect VAT”, submit monthly/quarterly VAT returns as applicable, and remit VAT in specified foreign currencies through the MRA’s portal facilities. This is the structural hallmark of a destination-based VAT collection model for cross-border digital consumption: the compliance burden is shifted upstream to the supplier, even where the supplier has no physical presence in Mauritius, so that VAT attaches where the consumer market exists rather than where the technology infrastructure sits.
Illustration: “Cobalt Stream Ltd.”, incorporated in Ireland, begins supplying video-on-demand subscriptions to Mauritian customers from 10 January 2026. Even if contracts are concluded online and payments are routed through an offshore payment gateway, the statutory design requires Cobalt Stream to register, charge VAT at the prescribed rate, file returns and remit VAT through MRA systems because the consumption is in Mauritius.
- Foreign supplier and covered services: scope is defined by establishment and service character
Foreign Supplier.
The Guide defines a “foreign supplier” as one who (a) has no permanent establishment in Mauritius or has his place of abode outside Mauritius; and (b) supplies, in the course of business, digital/electronic services to a person in Mauritius. The practical importance lies in the first limb: a foreign supplier is characterised by non-establishment, not by nationality or by the place where servers are located. This ensures that digital business models do not escape VAT merely because the supplier is offshore.
Character of services.
The Guide anchors “digital or electronic services” to Part III of the Tenth Schedule and lists typical categories—
(a) Supplies of images or texts, such as photographs, screensavers, electronic books and other digitized documents
(b) Supplies of music, films, television shows, games and programmes on demand
(c) Supplies of applications, software and software maintenance
(d) Website supply or web hosting services
(e) Advertising space on a website
(f) Online magazines
(g) Distance maintenance of programmes and equipment
The list is commercially broad and captures the most common digital monetisation models: subscriptions, licences, “as-a-service” provisioning, and ad-tech monetisation. It is also notable that “software maintenance” and “distance maintenance” are explicitly included, which is often where cross-border characterisation disputes arise in practice.
Taxability.
Under section 14A(1), the foreign supplier “shall charge VAT” on any such services supplied to any person in Mauritius, in accordance with the charging provisions, and the Guide specifies that VAT is to be charged at 15% on taxable supplies.
Illustration:
“Nimbus Host GmbH” (Germany) supplies web hosting and remote maintenance of software to Mauritian SMEs, while also selling banner advertising on its platform to Mauritian businesses. Each of these supplies falls within the specified categories and is therefore within the VAT scope when supplied to persons in Mauritius, requiring VAT at 15% to be charged and remitted.
- Locating the recipient in Mauritius: the two-indicator rule as evidentiary discipline
Identifying the recipient in Mauritius
A foreign supplier must treat a recipient as being in Mauritius if any two of the stated indicators are non-contradictory and support the conclusion that the recipient is in Mauritius. The indicators are the billing address, the bank location from which payment originates, the IP address or another geolocation method of the device used, the international country code in the recipient’s contact details, or any other commercially relevant information.
The requirement of “two” non-contradictory indicators is commercially significant because it anticipates the reality of VPNs, travelling customers, offshore payment instruments and “split” customer footprints. It compels the supplier to adopt internal controls: collecting data points, resolving contradictions, and retaining records. For compliance robustness, foreign suppliers would typically configure payment pages to capture billing jurisdiction, use bank BIN data (where available), store device geolocation signals, and record phone country code—so that the “two-indicator” standard can be consistently applied and defended in audit.
Illustration:
“AtlasLearn Inc.” sells online professional courses. On 18 February 2026, a customer pays using a card issued by a bank located in Mauritius and provides a Mauritian phone country code, but uses an IP address that resolves abroad. Two indicators still support Mauritius; VAT should be charged. Conversely, if billing address is Mauritius but bank location and device geolocation both indicate a different country, the supplier must treat the data as contradictory and apply a reasoned conclusion, retaining “commercially relevant information” to justify the classification.
- Compulsory registration irrespective of turnover: portal credentials, TAN and category selection
A foreign supplier must register for VAT in Mauritius if it supplies the specified services in Mauritius, and “VAT registration is compulsory irrespective of … turnover of taxable supplies.” This removes threshold litigation and makes the compliance trigger transaction-based rather than turnover-based.
The registration process is structured as a two-stage mechanism. First, the foreign supplier must email [registration@mra.mu](mailto:registration@mra.mu) with mandatory identity particulars viz., certificate of registration (for companies) or passport (for individuals), correspondence address, phone number and email address. After these details are submitted, MRA provides a Tax Account Number (TAN) and password to log into the simplified VAT registration system. Within that portal workflow, the supplier must select the business activity “Foreign supplier supplying digital or electronic services” and select the service categories supplied. Upon completion, MRA issues the VAT Registration Number and confirmation notice to the supplier or its appointed tax representative. This is a compliance architecture designed for foreign onboarding: it relies on digital credentials rather than local physical presence, and it places particular importance on correct categorisation at the time of registration.
Illustration:
“BrightApps Pte. Ltd.” (Singapore) begins supplying paid mobile applications and software maintenance services to customers in Mauritius from 1 January 2026. On 3 January 2026, it sends the required email particulars and receives TAN credentials. On 7 January 2026, it completes portal registration selecting the foreign supplier category and the relevant service heads. From that point, BrightApps is expected to charge VAT on its Mauritian supplies and comply with the return and payment cadence. Any delay in the preliminary email step is not a procedural triviality; it directly impairs the ability to register before meaningful supplies accrue.
- Tax representative framework: turnover threshold, principal–agent design, and liability contours
Turnover-linked enforcement safeguard.
Where the turnover of taxable supplies of a foreign supplier in Mauritius exceeds or is likely to exceed Rs 3 million (or equivalent in foreign currency), it “must appoint a tax representative” having a permanent establishment in Mauritius. This threshold does not dilute the supplier’s own obligations; it supplements them by ensuring there is a locally reachable compliance interface for higher-volume suppliers.
The Guide sets professional expectations for who can act as tax representative, emphasising licensed persons/entities with Mauritian tax familiarity (including CPAs, tax advisory firms, legal firms with tax expertise, and authorised tax agents/consultants). More importantly, it conceptualises the relationship as a principal–agent structure: the foreign supplier remains the taxable person and legally responsible, while the representative performs administrative compliance, acts as point of contact, and ensures records are maintained in Mauritius. The liability discussion is calibrated: it describes the representative’s liability as a safeguard invoked in persistent non-compliance or intentional non-payment, but it also states that the representative may be held liable if VAT amounts collected are not remitted, with exposure to prosecution for failure to account for entrusted funds. This has a clear commercial implication—foreign suppliers cannot treat representation as a mere formality; contractual arrangements with representatives must address funding flows, remittance timelines, and documentary control, because the representative’s statutory risk is tied to the integrity of the remittance process.
The procedural communication to MRA is also specified: appointment is notified by email to [digital.vat@mra.mu](mailto:digital.vat@mra.mu) with a signed letter of representation detailing appointment date, representative name, TAN/BRN and contact details, and the representative must notify acceptance; changes must be promptly intimated. The Guide also clarifies that once portal credentials are generated, they may be provided to the representative so that the representative can register and comply on behalf of the supplier.
Illustration: “ZenAds BV” (Netherlands) earns MUR 3.8 million from Mauritian advertising customers by June 2026 and expects annual turnover to exceed the threshold. It appoints “Port Louis Tax Partners LLP” as representative on 15 July 2026, notifies MRA with the signed letter, and transfers portal credentials. If ZenAds collects VAT from customers but fails to fund the remittance, the representative’s risk is not theoretical, because the Guide links liability to the duty to remit entrusted funds.
- Time of supply, invoicing dispensation, return filing cadence, payment currency, and reverse charge transition
When VAT must be captured for return purposes:
VAT charged or collected is to be included in the VAT return for the relevant month/quarter based on the earlier of (i) the date the foreign supplier issued an invoice, or (ii) the date it received payment for the supply. This “earlier event” approach is vital for subscription and prepayment models, and it obliges suppliers to configure billing systems so that VAT recognition is aligned with the first monetisation event rather than with service delivery milestones alone.
Invoice not for foreign suppliers:
Foreign suppliers are not required to issue a VAT invoice under the referenced provision. However, local businesses can claim credit for input VAT on such services even when no VAT invoice is issued. Thus, for registered taxpayers, the payment of tax is not a cost.
Periodicity of returns is turnover-based
Returns are required to be submitted electronically after the end of every taxable period, within twenty days (or such other time as may be prescribed), and at the time of submitting the return the supplier must also provide electronically a list of taxable supplies made to persons in Mauritius. Annual turnover exceeding MUR 10 million requires monthly returns; below that threshold, quarterly filing is permitted. Payment is electronic at the time of return filing, and the regime is designed to accept remittance in specified foreign currencies (USD, EUR, GBP, SGD, ZAR, CHF, and others as approved), with a choice mechanism where receipts are in multiple currencies.
Banking precaution
Tax representatives must ensure direct debit orders are properly submitted to facilitate bank authorisation.
No reverse charge in case of Mauritius registered foreign supplier:
Once a foreign supplier is VAT-registered in Mauritius, the reverse charge mechanism is “no longer applicable” for such supplies. The foreign supplier must charge VAT to VAT-registered businesses and report supplies. Input tax is expressly denied to foreign suppliers of these services. The combined effect is a clean compliance switch—supplier collection replaces reverse charge where registration exists, but the foreign supplier is not given a domestic input tax recovery profile.
Illustration:
“CloudForge LLC” issues an invoice on 28 March 2026 for a one-year SaaS licence to a Mauritian client and receives payment on 2 April 2026. VAT must be reported in the period containing 28 March (earlier event). It files returns electronically within the prescribed window, remits VAT in USD (its chosen currency), and once registered, it charges VAT to VAT-registered Mauritian clients rather than expecting them to self-assess under reverse charge.
- Correlation with Indian GST:
Mauritius’ model under section 14A is conceptually closest to India’s regime for cross-border OIDAR (Online Information and Database Access or Retrieval) services under Section 14 of the IGST Act.
Brief on Indian provisions
Section 14 of the IGST Act creates a special charging and compliance framework for OIDAR (often typed as “IODAR”) supplied from outside India to unregistered recipients in India (the “non-taxable online recipient”). OIDAR services includes sweep of typical supplies, such as internet advertising, cloud services, supply of e-books/movies/music/software and other intangibles through telecom networks or internet, providing data/information in electronic form through a computer network, online supplies of digital content, digital data storage, and online gaming (excluding online money gaming as defined separately). Where OIDAR is supplied by a person located in a non-taxable territory and received by a non-taxable online recipient, “the supplier of services located in a non-taxable territory shall be the person liable for paying integrated tax.” The IGST Act defines “non-taxable online recipient” as any unregistered person receiving OIDAR located in taxable territory (i.e., India).
If the Indian customer is registered, the Section 14 mechanism (supplier liability) is not the default rule; the tax incidence typically shifts to the Indian registered recipient under reverse charge for import of services (subject to the applicable reverse charge notification framework). In case of unregietered receipient located in Inida, the law requires supplier to obtain registration and discharge tax. To determine recipient in India, a “2-of-7 evidence rule” is to be followed. The foreign supplier must design the checkout / onboarding flow to capture at least two independent indicators, retain them as transaction evidence, and ensure they are not internally contradictory. The recipient is deemed to be located in taxable territory if any two of the following non-contradictory conditions are satisfied—(a) address presented through internet is in India, (b) payment card issued in India, (c) billing address in India, (d) IP address in India, (e) bank account used for payment maintained in India, (f) SIM country code is India, (g) fixed landline through which service is received is in India.
Section 14(2) further creates a compliance substitute where the supplier has an Indian presence:
- If a person in India is representing the foreign supplier for any purpose, such person must register and pay IGST on behalf of the supplier.
- If there is no physical presence and no representative, the foreign supplier may appoint a person in India for payment; that appointed person becomes liable for the tax payment mechanism.
For online supplies to unregistered recipients (including OIDAR), the supplier must capture and record the State of the recipient on the invoice
Comparison
In practical terms, both jurisdictions pursue destination taxation for digital consumption, both operationalise compliance through a dedicated electronic return framework, and both treat customer-location evidence and the B2C/B2B split as central to determining whether the foreign supplier must charge tax directly or whether a reverse-charge mechanism applies.