Payroll taxes in Mauritius that are of key importance to employers include Contribution Sociale Généralisée (CSG), National Savings Fund (NSF) contributions, Pay As You Earn (PAYE) income tax withholding, and the Skills Development Levy. Learn more about the processes for setting up payroll, calculating taxes, submitting payments compliantly, and adhering to due dates in Mauritius.
Capital City
Port Louis
Currency
Mauritian Rupee
(
₨
)
Timezone
MUT
(
GMT +4
)
Payroll
Monthly
Employment Cost
12.5% - 15.5%
Managing payroll taxes in Mauritius requires attention to several key components that affect both employers and employees. For businesses operating in Mauritius, whether small enterprises or large corporations, understanding the tax landscape is essential for compliance and efficient operations.
Employers need to be aware of various obligations including the Contribution Sociale Généralisée (CSG), National Savings Fund (NSF) contributions, income tax withholding through the Pay As You Earn (PAYE) system, and additional levies such as the Skills Development Levy.
Non-compliance can result in significant penalties, including monthly surcharges of up to 5% (capped at 100%), as well as potential legal complications and damaged employee relations. This article aims to guide you through the intricacies of Mauritius payroll taxes, helping you understand calculation methods, submission deadlines, and proper filing procedures to ensure your business remains compliant while efficiently managing employment costs.
1 January - 31 December is the 12-month accounting period that businesses in Mauritius use for financial and tax reporting purposes.
The payroll cycle in Mauritius is usually monthly, with employees being paid by the last day of the month.
As of January 1, 2025, the national minimum wage in Mauritius is set at MUR 17,110 per month. This represents a 3.7% increase from the previous rate of MUR 16,500 per month, implemented to address rising living costs and inflation.
In addition to the base minimum wage, a salary compensation of MUR 610 per month is provided to eligible employees. This compensation aims to further support workers amidst economic challenges.
Employers in Mauritius are required to provide a 13th salary to employees. This can be in the form of an end-of-year bonus, equivalent to 1/12 of the annual earnings, or a gratuity as per the End of Year Gratuity Act 2001, whichever is higher. This applies if the employee has been continuously employed for all or part of the year and remains employed as of December 31 of that year.
Payroll calculation in Mauritius involves several components that affect both employer costs and employee take-home pay. The process begins with determining the gross salary, which forms the basis for various statutory deductions and contributions.
For employees, deductions include income tax through the PAYE system (which follows a progressive tax structure with rates ranging from 0% to 20%), CSG contributions (1.5% for salaries up to MUR 50,000 and 3% for higher salaries), and National Savings Fund contributions (1% of basic salary).
Employers must calculate their contributions to CSG (3% for employees earning up to MUR 50,000 and 6% for those earning more), NSF (2.5% of remuneration), Skills Development Levy (1% of total basic wages), and set aside funds for mandatory bonus payments including the 13th-month salary.
The calculation must also account for any allowances, overtime pay, and other benefits that may be subject to taxation. After all deductions, the remaining amount constitutes the employee's net pay, which must be disbursed by the last day of each month.
Mauritius has established several payroll taxes and contributions that employers must manage. Each has specific regulations, calculation methods, and submission requirements. Understanding these different types of taxes is crucial for proper payroll management and compliance with Mauritian law.
The Contribution Sociale Généralisée (CSG) is Mauritius's social security system that replaced the previous pension system in September 2020. For employees earning up to MUR 50,000 monthly, the contribution rate is 1.5% from the employee and 3% from the employer. For those earning above MUR 50,000, the rates increase to 3% for employees and 6% for employers.
Public sector employees have different rates, with employers contributing 4.5% for salaries up to MUR 50,000 and 9% for higher salaries. CSG contributions must be submitted monthly, and late payments incur a 5% monthly surcharge up to a maximum of 100%. This system provides retirement benefits to employees and is mandatory for all eligible workers.
The National Savings Fund requires contributions of 1% from employees (deducted from their basic salary) and 2.5% from employers based on total remuneration. Additionally, employers must pay a monthly levy of 1.5% of basic salaries. The NSF serves as a retirement savings mechanism for employees, complementing the CSG system.
Contributions begin from the month of employment, though certain categories are exempt, including employees under 18 or over 70 years old, and non-Mauritian employees in export manufacturing during their first two years. Like other statutory contributions, NSF payments must be made monthly, with similar penalties for non-compliance as the CSG system.
The Pay As You Earn system requires employers to withhold income tax from employee salaries on a monthly basis. Tax is calculated on a progressive scale ranging from 0% (for income up to MUR 390,000 annually) to 20% (for income above MUR 2,390,001).
PAYE is calculated cumulatively throughout the tax year, and employers must submit these withholdings to the Mauritius Revenue Authority. Employees earning MUR 30,000 or less monthly are typically exempt from income tax. Employers must ensure accurate calculation and timely submission of PAYE deductions, as failures can result in penalties and interest charges. Employees are required to submit an annual Employee Declaration Form (EDF) to facilitate proper tax assessment.
Setting up a payroll system in Mauritius requires careful planning and adherence to local regulations. This process involves registering with relevant authorities, selecting appropriate payroll software, and establishing procedures for employee onboarding and data management.
To establish a compliant payroll system in Mauritius, businesses must register with several government bodies:
Registration typically requires submission of company incorporation documents, director identification, and business activity details. Most registrations can now be completed online through the respective authority websites, streamlining the process for new employers.
Selecting the right payroll system is crucial for efficient operations in Mauritius. Businesses have several options to consider:
When selecting a system, consider factors such as compliance with Mauritius tax laws, ability to handle CSG and NSF calculations, reporting capabilities, and cost-effectiveness. The ideal solution should accommodate your business size, growth plans, and specific industry requirements while ensuring accurate tax calculations and timely submissions.
Proper employee onboarding is essential for accurate payroll processing in Mauritius. When bringing new employees into your payroll system, collect all necessary documentation including:
Create individual employee profiles in your payroll system with accurate personal information, tax status, salary details, and applicable allowances. Ensure employees understand the various deductions that will apply to their salaries, including CSG contributions, NSF, and income tax withholding. Establishing a clear onboarding process helps prevent payroll errors and ensures compliance with Mauritius employment regulations from the start.
Accurate payroll processing is crucial for maintaining compliance with tax and employment regulations in Mauritius. Follow these steps to ensure correct processing of payroll.
Accurate time tracking forms the foundation of payroll processing in Mauritius. Employers should implement reliable systems to record employee work hours, especially for hourly workers or those eligible for overtime. Digital time-tracking solutions offer advantages over manual systems, including reduced errors and simplified data integration with payroll software.
For salaried employees, attendance tracking remains important for managing leave entitlements and absences. Mauritian labor laws require employers to maintain attendance records, and these records may be requested during labor inspections. Establish clear policies for timesheet submission deadlines, typically 3-5 days before the payroll processing date, to ensure timely salary calculations and payments.
Salary calculation in Mauritius requires careful attention to various components and statutory deductions. Begin with the gross salary, then apply the appropriate deductions:
For employer contributions, calculate:
Ensure all calculations comply with current tax rates and contribution percentages, as these may change with annual budget announcements.
Mauritian employers are legally required to provide detailed payslips to all employees. These payslips must include specific information:
Modern payroll systems can generate compliant payslips automatically. These can be distributed electronically (via email or employee portals) or in printed form. Electronic distribution is increasingly preferred for its efficiency and environmental benefits. Regardless of the distribution method, payslips should be provided to employees on or before the payment date, and employers should maintain copies for at least five years to comply with record-keeping requirements.
Timely submission of payroll data to Mauritian authorities is essential for compliance. Employers must submit:
Most submissions are now required electronically through the respective authority portals. The MRA's e-filing system handles PAYE submissions, while CSG and NSF contributions are typically managed through the Ministry of Social Security's online platform. Maintain proof of submission and payment for all filings, as these may be required during tax audits or inspections.
Salary payments in Mauritius must be made by the last day of each month. The most common payment methods include:
Electronic payments through the Mauritius Automated Clearing and Settlement System (MACSS) facilitate efficient batch processing of salaries. Employers should maintain detailed payment records, including transaction references and confirmation receipts. For international employees, ensure compliance with foreign exchange regulations when making cross-border payments. Regardless of the payment method, employers must ensure funds are available to employees by the legally mandated deadline.
Understanding the tax obligations for both employers and employees is crucial when operating in Mauritius's business landscape. This section explains how taxes and statutory fees affect payroll and individual earnings in Mauritius.
Employer payroll contributions are generally estimated at an additional 12.5% - 15.5% on top of the employee salary in Mauritius.
In Mauritius , the typical estimation for employee payroll contributions cost is around 5.5% - 7%.
Individual income tax varies between 10% and 15%, with progressive rates as defined below. Its worth noting that income exemption thresholds may also apply depending on the number of dependents - for more information on this, reach out to one of our experts!
Mauritius' pension system comprises various pillars, including a basic retirement pension scheme, mandatory contributory lump sums, mandatory contributory income streams, and voluntary pension schemes. The standard retirement age is 65 years old.
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Global employers operating in Mauritius often encounter unique payroll challenges that can affect compliance and efficiency, like navigating evolving tax laws and managing employee data. With a need for real-time accuracy, modern organizations must develop strategies to overcome these challenges effectively. Below, we explore some of the most common payroll hurdles and provide actionable solutions to streamline payroll processes in Mauritius.
Maintaining accurate global payroll reports is often challenging due to currency exchange complexities, data integration issues, and the need to keep employee information up-to-date – including tax information, hours worked, leave balances, and any changes in salary or job status. Generating accurate reports is easy with a comprehensive payroll automation tool that consolidates fragmented data sources, and can keep track of employee payments and deductions.
In Mauritius, tax laws and compliance regulations can change frequently, presenting a significant challenge for global employers. Monitoring updates to federal, state, and local tax codes is crucial to avoid non-compliance and costly penalties, but requires significant time and resources. Partnering with local experts or a reputable global HR platform is an effective way to maintain compliance. These services can help employers stay compliant with evolving regulations while freeing up time for more strategic work.
Managing payroll across multiple vendors often leads to fragmented data and inefficiencies, making it difficult to consolidate analytics. These challenges can hinder decision-making, especially when trying to gain a clear view of workforce costs and trends. To address this, organizations can invest in a centralized payroll management system that unifies data from multiple vendors. A consolidated platform simplifies payroll tracking, ensures data accuracy, and provides actionable insights into payroll expenditures.
Global companies are prone to using multiple HR or payroll systems across regions, which can easily lead to fragmented payroll data, increasing the risk of delays and errors in employee compensation. To combat this, seamless integration between payroll and other systems is critical.
Payroll management systems that connect with existing HR and financial platforms can help streamline workflows by reducing manual inputs and ensuring that all departments operate with up-to-date, accurate information. In turn, this helps guarantee on-time, accurate payroll, boosting employee satisfaction.
A global payroll management platform is a software solution designed to streamline and automate the payroll processes for organizations with employees across multiple countries. It helps ensure accurate and timely payment while maintaining compliance with legal and regulatory requirements in Mauritius.
Expanding globally is an exciting milestone for any company, but it comes coupled with complex payroll challenges. It doesn’t have to be complicated. At Playroll, our easy-to-implement global payroll management software combines automation with hands-on support to make global payroll truly simple. Here's how Playroll helps:
Disclaimer
THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.
ABOUT THE AUTHOR
Milani Notshe
Milani is a seasoned research and content specialist at Playroll, a leading Employer Of Record (EOR) provider. Backed by a strong background in Politics, Philosophy and Economics, she specializes in identifying emerging compliance and global HR trends to keep employers up to date on the global employment landscape.
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Payroll taxes in Mauritius are calculated based on the employee's gross salary. For income tax (PAYE), a progressive tax system applies with rates ranging from 0% to 20%. The first MUR 390,000 of annual income is tax-free, with increasing rates for higher income brackets. CSG contributions are calculated at 1.5% for employees earning up to MUR 50,000 monthly (with employers contributing 3%) and 3% for those earning more (with employers contributing 6%). NSF contributions are calculated at 1% of basic salary for employees and 2.5% of remuneration for employers. Additionally, employers must contribute to the Skills Development Levy at 1% of total basic wages and accrue for the mandatory 13th-month salary bonus.
Employers in Mauritius have several payroll management options, including in-house payroll processing using dedicated software, cloud-based payroll solutions with Mauritius tax compliance features, outsourced payroll services from local accounting or payroll firms, and hybrid approaches combining in-house management with external expertise. The choice depends on business size, complexity, and internal resources, with many employers opting for specialized payroll software that automatically calculates taxes and generates required reports. Multinational companies often turn to international payroll providers with specific Mauritius expertise to ensure compliance while integrating with global systems.
The key elements of Mauritius payroll include basic salary calculation, statutory deductions (such as PAYE, CSG, NSF), employer contributions (for CSG, NSF, and the Skills Development Levy), mandatory bonus payments (like the 13th month salary), leave management (covering paid annual leave, sick leave, and public holidays), record-keeping, compliance reporting, timely payment processing, and payslip generation and distribution. Employers must also maintain accurate employee records, process new hires and terminations correctly, and ensure compliance with minimum wage regulations, which are set at MUR 17,110 per month.
Payroll tax percentages in Mauritius vary based on income levels and contribution types. For employees, the Income Tax (PAYE) follows a progressive scale ranging from 0% to 20%, CSG is 1.5% for salaries of MUR 50,000 or less per month and 3% for salaries exceeding MUR 50,000, and NSF is 1% of the basic salary. For employers, CSG is 3% for salaries ≤ MUR 50,000 per month and 6% for salaries > MUR 50,000, NSF is 2.5% of remuneration, NSF Levy is 1.5% of basic salaries, Skills Development Levy is 1% of total basic wages, and the 13th Month Salary is equivalent to one month's basic salary (8.33% accrual). The total employer contribution typically ranges from 8% to 15% of the employee's gross salary, depending on the salary level and specific circumstances.
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