A Limited Partnership (LP) is a business arrangement where two or more partners engage in a business while having distinct roles: general partners manage the business and assume responsibility, while limited partners contribute capital and enjoy limited liability. Mauritius has become a recognised jurisdiction for establishing LPs, known for its strategic location, powerful financial infrastructure, and favourable business environment. As a globally recognised financial hub, Mauritius offers a secure and efficient platform for investors and businesses to operate and thrive.
Legal Framework and Regulatory Environment
Limited partnerships in Mauritius are governed by a well-defined legal framework that ensures transparency, protection, and compliance. The Financial Services Commission (FSC) of Mauritius plays a pivotal role in regulating and supervising limited partnerships holding Global Business Licences (GBL), ensuring they adhere to international standards. Key legislative acts and regulations, such as the Limited Partnerships Act and the Financial Services Act, provide a solid foundation for the formation and operation of limited partnerships in Mauritius.
Different Purposes and Uses of Limited Partnerships
Limited partnerships in Mauritius can serve various purposes across different industries. They are commonly used for investment funds, providing a flexible structure for pooling and managing investments. Real estate ventures and private equity firms also benefit from the limited partnership structure, allowing for efficient capital raising and management. Furthermore, limited partnerships are utilised in estate planning and wealth management, offering strategic solutions for asset protection and succession planning.
Tax Benefits of Limited Partnership in Mauritius
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With Legal Personality
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Without Legal Personality
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Separate Tax Entity: A limited partnership with legal personality is taxed as a separate entity. This can offer advantages in terms of tax planning and structuring.
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Flow-Through Taxation: Limited partnerships without legal personality typically benefit from a flow-through taxation, meaning the partnership itself is not taxed. Instead profits and losses are passed through to the partners and taxed at their individual tax rates.
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The choice between establishing a limited partnership with or without legal personality in Mauritius depends on the specific tax planning needs and objectives of the partners. Both structures offer distinct tax benefits, and the optimal choice will vary based on the nature of the business activities, the residency of the partners, and the intended use of the partnership. Seeking professional tax advice is crucial to maximise the tax advantages available in either scenario
Partnership Agreement
Clearly outline the roles, responsibilities, and contributions of general and limited partners.
File Application with the FSC
Blue Azurite submits the LPA and required documentation, and information to the FSC and the Registrar.
Obtain Approval
Upon review and approval by the FSC, the limited partnership is formally recognised.
Start Operations
Once registered, the bank account can be opened and the limited partnership can begin its business activities.
The timeline and costs involved in the registration process vary, and Blue Azurite is available to facilitate the process.
In summary, establishing a limited partnership in Mauritius offers numerous advantages, including favourable tax conditions, confidentiality, and a supportive regulatory environment. With its global recognition as a financial hub, Mauritius provides an ideal platform for limited partnerships to thrive. If you are considering establishing a limited partnership, seek professional advice from Blue Azurite to get started on this rewarding journey in Mauritius.
