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YEAR OF ASSESSMENT 2013 (INCOME FOR THE PERIOD 1 JANUARY 2012 TO 31 DECEMBER 2012)

NOTES - HOW TO FILL IN YOUR RETURN (I.T FORM 6)

 Page 1

Note 1

 

GENERAL INFORMATION ON SOCIÉTÉ

 

 

A société includes -

  1. a société formed under any enactment in Mauritius;
  2. a société commerciale;
  3. a société de fait or a société en participation;
  4. a limited partnership;
  5. a joint venture; or
  6. a société or partnership formed under the law of a foreign country.

 

"Resident" in relation to a société means a société which has its seat or siège in Mauritius and includes a société which has at least one associate or associé or gérant resident in Mauritius.

 

A "société commerciale" is required to submit a return whether or not it has derived any income during the income year ended 31 December 2012. Other resident sociétés should submit a return only where they have derived any income during that income year.

 

Note 2

 

INCOME PERIOD

 

All sociétés are required to file tax returns in respect of income derived on a calendar year basis, i.e for the period 1 January to 31 December. As a result, all sociétés should close their accounts on 31 December each year. The return for the year of assessment 2013, based on income derived for the period 1 January 2012 to 31 December 2012, should be submitted to MRA not later than 1 April 2013.

 

Note 3

 

TRADING AND PROFIT AND LOSS ACCOUNT

 

The details of trading and profit & loss a/c should be given on page 2. No accounts should be attached. Any item of expenditure in the Trading & Profit & Loss a/c not indicated in the return should be included in item 3.40 ‘other expenses’.

 

Note 4

 

COMPUTATION OF NET INCOME

 

The profit as per the profit & loss a/c is not the taxable profit as not all items of income are taxable nor are all items of expenses deductible for tax purposes. The net profit/loss as per profit and loss a/c needs to be adjusted on page 3 to arrive at the net income for tax purposes.

 

Income to be expressed in Mauritian Rupees

 

All transactions should be expressed in Mauritian rupees at the rate in force at the date the amount is remitted, or where any amount has not been remitted, the rate in force at the end of the income year.

 

General Rule for deduction of expenses

 

Any expenditure or loss to the extent to which it is exclusively incurred in the production of gross income is deductible.

 

Unauthorised deductions

 

The following items of expenditure are specifically prohibited by Section 26 of the Income Tax Act -

 

  1. any investment, expenditure or loss to the extent to which it is capital or of a capital nature;
  2. any expenditure or loss to the extent to which it is incurred in the production of income which is exempt income;
  3. any reserve or provision of any kind;
  4. any expenditure or loss recoverable under a contract of insurance or of indemnity;
  5. any expenditure incurred in providing business entertainment or any gift;
  6. income tax or foreign tax;
  7. any expenditure or loss to the extent to which it is of a private or domestic nature.

 

Expenditure incurred in the production of exempt income

 

  1. Expenditure or loss exclusively incurred in the production of exempt income is not allowable.
  2. Where expenditure or loss is incurred in the production of both gross income and exempt income, that part of the expenditure or loss attributable to the production of exempt income shall be calculated using the following formula:

    exempt income * expenditure or loss / total gross income (including exempt income)

  3. Where the proportion of exempt income to total gross income in the above formula is 10 per cent or less, no part of the expenditure or loss as determined above shall be disallowed.

 

Dividends receivable

 

Dividends receivable from a resident company are exempt from tax. However, the expenses incurred to produce such exempt income should be added back in Item 4.2 of Page 3. Dividends receivable from outside Mauritius are taxable.

 

 Page 2

Annual Allowance

Depreciation is not an allowable deduction. However, you may claim annual allowance in respect of capital expenditure as specified hereunder:

Capital Expenditure incurred on —

Rate of Annual Allowance

 

 Percentage of 

 

Base Value

Cost

Industrial premises ...............................................................................................

-

 

5

Commercial premises ...........................................................................................

-

 

5

Hotels ..................................................................................................................

30

 

-

Plant or Machinery-

 

 

 

  (a) costing or having a base value of 30,000 rupees or less ..........................

100

or

100

  (b) costing more than 30,000 rupees-

 

 

 

     (i) ships or aircrafts ......................................................................................

20

 

-

     (ii) aircrafts and aircraft simulators leased by a company engaged in aircraft leasing

-

 

100

     (iii) motor vehicles............................................................................................

25

 

-

    (iv) Electronic and high precision machinery or equipment,computer hardware and peripherals and computer software

50

 

-

     (v) furniture and fittings ..............................................................................

20

 

-

     (vi) other ........................................................................................................

35

 

-

Improvement on agricultural land for agricultural purposes .................................

25

 

-

Scientific research ...............................................................................................

25

 

-

Golf courses .......................................................................................................

15

 

-

Acquisition or improvement of any other item of a capital nature which is subject to depreciation under the normal accounting principles

-

 

5

 

No other deduction is however allowable in respect of the same expenditure.

 

Where a société , not carrying on the business of tour operator or car rental, incurs capital expenditure on or after 1 January 2011 on a motor car costing more than three million rupees, the annual allowance shall be 25% of three million rupees.

 

No annual allowance is allowable unless proper books of accounts and records are kept.

 

Note 5 - Section 3.5

 

INTEREST INCOME

 

Interest earned by a société as from 1 January 2010 on savings and fixed deposit accounts maintained with a bank or non-bank deposit taking institution, Government securities and Bank of Mauritius Bills are exempt.

 

However, all interests earned during period 1 July 2006 to 31December 2009, which were paid to the société in year 2012 are taxable.

 

Note 6 - Section 5

 

TAX DEDUCTION AT SOURCE (TDS)

 

Enter at section 5 the amount deducted at source as TDS in the year 2012 on the société's income as per Statement of Income Received.

 

The TAN of the payer should be inserted where the TDS has been deducted on income derived by the société directly. However, where the société is entitled to deduct its share of TDS on income derived by another société, the TAN of that société should be inserted.

 

Note 7 - Section 6

 

PENALTY

 

Penalty for late submission of return

 

In case of late submission of return a penalty of Rs 2,000 per month or part of the month is payable until the time the return is submitted. The total penalty is restricted to Rs 20,000.

 

Note 8 - Section 7

 

ANNUAL STATEMENT OF SHARE OF NET INCOME/LOSS

 

Details in respect of all associates should be provided at section 7.

 

  1. The income of an associate from a resident société is deemed to be the share to which he would have been entitled in the income of the société if the income had been wholly distributed among the associates.
  2. For the purposes of calculating the net income/loss of an associate from a société, the associate is deemed -
    1. to have derived that part of the gross income of the société; and
    2. to have incurred that part of the allowable deductions of the société

      which bears the same proportion to the gross income or allowable deductions of the société as his share in the income/ loss of the société bears to the income/loss of the société.

  3. Where tax has been deducted at source from any income derived by a société, each of its associates is entitled to claim a credit in respect of his share of the amount of the tax deducted at source.

 

Note 9

 

A statement must be given by the société to each associate not later than 31 March 2013 showing the share of net income/loss accruing to that associate and his share of TDS. The statement must be made in the approved form "Statement by société to associate" available under "Downloadable forms" on MRA website.