On 22 September 2026, the Mauritius Revenue Authority (MRA) issued a communiqué detailing the Transitional Qualified Status (TQS) under the Domestic Minimum Top-up Tax (DMT Tax) regime. This guidance aligns with the OECD Pillar Two framework and the Mauritius Finance (Miscellaneous Provisions) Act 2026, which enacted the DMT Tax effective for fiscal years starting on or after 1 July 2026. The TQS provision allows constituent entities of multinational enterprise (MNE) groups to benefit from a temporary safe harbour, deferring the application of the DMT Tax where certain conditions are met. The communiqué clarifies the eligibility criteria, the election process, and the interaction with the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR). It also references the OECD’s Transitional Safe Harbour Guidance (February 2025) and confirms that Mauritius will adopt the three safe harbour tests: the de minimis test, the simplified effective tax rate test, and the routine profits test. Taxpayers must submit a notification to the MRA within the prescribed timeframe to claim TQS for a given fiscal year.
Key Takeaways
- Eligibility and Election: MNE groups with consolidated revenue exceeding EUR 750 million must assess each jurisdiction against the three safe harbour tests. An annual election is required, and the MRA will publish the prescribed form and submission deadlines shortly.
- Interaction with Global Rules: The TQS does not exempt the group from the IIR or UTPR in other jurisdictions; it only defers the DMT Tax liability in Mauritius. Groups must maintain contemporaneous documentation to support the safe harbour calculations.
- Compliance Timeline: For the first fiscal year under the regime (e.g., year ending 30 June 2027), the election must be filed by the due date of the DMT Tax return. Late elections may be accepted under reasonable cause provisions, but penalties apply for non-compliance.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement