Client Background
Int Global Ventures, an international conglomerate with diverse business interests, sought to streamline its global operations and enhance profitability. Facing complex tax regulations in various jurisdictions, the company decided to explore tax optimisation strategies, with a specific focus on Mauritius.
Challenge
Int Global Ventures faced challenges related to high tax liabilities, regulatory compliance, and administrative complexities across its international subsidiaries. The goal was to find a legal and ethical way to optimise their tax structure while ensuring compliance with international laws and regulations.
Solution:
The company engaged our services to develop a comprehensive tax optimisation strategy, leveraging the favourable tax environment and incentives offered by Mauritius. The key components of the solution included:
- Establishment of a Mauritius Holding Company:
- Formation of a Mauritius based holding company to centralise ownership of international subsidiaries.
- Leveraging the Double Taxation Avoidance Agreements (DTAAs) signed by Mauritius with several countries so as to minimise withholding taxes on dividends.
- Tax-Efficient Structuring:
- Careful structuring of the inter-company transactions to maximise tax benefits.
- Utilisation of Mauritius’ partial exemption regime to reduce tax on capital gains.
- Global Business Licence (GBL):
- Securing a GBL in Mauritius, allowing the company to conduct a wide range of business activities globally.
- The GBL facilitated ease of doing business, access to a well-regulated financial sector, and eligibility for tax benefits.
- Transfer Pricing Compliance:
- Implementing transparent and compliant transfer pricing policies to align with international standards and reduce scrutiny.
Results
The implementation of the tax optimisation strategy in Mauritius yielded significant results for Int Global Ventures:
- Substantial Savings
The restructuring let to a notable reduction in the overall tax burden, enhancing the company’s profitability. - Improved Cashflow
By minimising and eliminating withholding taxes in certain circumstances and optimising the repatriation of profits, the company experienced improved cash flow. - Enhanced Global Competitiveness
The streamline tax structure increased the company’s competitiveness, allowing to reinvest savings into core business activities. - Regulatory Compliance
The tax optimisation strategy was meticulously designed to ensure compliance with both local and international tax regulations, mitigating the risk of legal challenges.
Int Global Ventures successfully leveraged Mauritius' tax optimisation framework to achieve strategic financial objectives while complying with legal and ethical standards. This scenario demonstrates how a well-executed tax optimisation strategy can be a powerful tool for international businesses seeking to enhance their global competitiveness and financial performance. It underscores the importance of expert guidance and thorough planning in navigating the complexities of international tax environments.
