Tag: invest abroad

Real Estate Investment – New PDS scheme Mauritius

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Foreigners have the possibility to acquire the property in full ownership in Mauritius as part of an investment project. They can acquire a residence under the Property Development Scheme (PDS), or a suite in a hotel program under the Invest Hotel Scheme (IHS)

Two schemes are offered to foreigners to invest in real estate:

The PDS (Property Development Scheme)

Since June 2015, the Mauritian government has decided to harmonize the regulation of real estate laws within a single legal framework, the PDS (Property Development Scheme), allowing both Mauritian citizens and foreign investors to fully own their property .
The PDS, the only legal framework now in force, replaces the two previous regimes: the Integrated Resort Scheme (IRS) and the Real Estate Scheme (RES). These two types of programs were distinguished mainly by the size, fittings and selling prices of the real estate project:

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The Integrated Resort Scheme (IRS)

This system allowed foreign investors (natural persons and legal entities) to acquire luxury villas or residences with high-quality infrastructures (golf courses, marinas, swimming pools, restaurants, sports complexes). The minimum investment amount was EUR 390,000. It automatically conferred residence permits

The RES (Real Estate Scheme)

The scheme was open to foreign and local investors (natural and legal persons) for small-scale (4 to 10 hectares) real estate projects with a minimum purchase price of EUR 200 000. It did not automatically confer a residence permit.

The PDS does not impose a minimum purchase price to allow the foreign investor to benefit from Mauritian tax benefits. As with the old IRS and RES schemes, the investor receives a residence permit if the amount of his investment exceeds USD 500,000.

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Only recognized real estate developers with real expertise in the trade can develop PDS real estate projects. In addition, their project must be environmentally friendly and fit seamlessly with neighboring Mauritian habitat. The ecological aspect is taken into consideration: green spaces, infrastructures favoring good ventilation, solar panels, water recovery … are necessary elements for obtaining building permits under the new PDS scheme.

More info about real estate investment in Mauritius with Dreamescapes Properties

The advantages of Mauritius for real estate investment

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In recent years, Mauritius, through its policy of good practice, has built a solid reputation in terms of ethics, good governance, transparency, economic and political freedom. The business environment is stable and favorable and the legal framework is clear and well defined. Mauritius is now recognized internationally as an ideal country to invest in.

Mauritius is constantly reinventing itself. The country is taking advantage of its strategic position at the crossroads of Africa, Asia and Australia. It is gradually transforming itself into an international center and jurisdiction for investors in real estate seeking security, transparent regulation and high added value, for example, as a platform for creating, investing or creating activities in Africa.

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Thanks to its strategic position in the Indian Ocean, Mauritius is a regional platform for trade, investment and tourism, interconnecting Africa and Asia with the rest of the world. The country is a business and financial hub, where business begins before markets close in the Far East and always on time to catch up Markets in the United States the same day.

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Taxation

In Mauritius, the tax system is favorable: No tax on capital gains, No tax on interest and dividends at source, Exemption from customs duties on equipment, Free repatriation of profits, Dividends and Capital and Corporate Tax, Income Tax and Value Added Tax at 15%.

To date, Mauritius has signed more than 40 double tax treaties and is currently participating in other negotiations.
Economy

The country is a signatory to many multilateral treaties and conventions ensuring the protection of foreign investors and Mauritius is a market economy and free trade. There is no exchange control or restrictions on the repatriation of profits, dividends and capital. The Index of Economic Freedom published by the Wall Street Journal ranks Mauritius 8th in the world among countries where economic freedom predominates.

Real estate at more competitive prices in Mauritius

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Some countries such as Portugal and Mauritius have become the preferred destinations of European investors and pensioners. If the fact that they are considered tax havens are the first thing that comes to mind, you must know nevertheless know that the benefits are real and multiple when talking about the real estate sector in Mauritius.
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The practice is common but thanks to some reforms of the government of Mauritius, it becomes an ideal solution for pensioners and professionals who want to start a new business on the Island. By observing the patterns of real estate acquisitions, it could be said that high-end villas are intended for wealthy buyers. But in reality, it will be enough of a few hundreds of thousands of euros to invest in real estate in Mauritius. Local real estate agencies can testify to this reality. The number of foreign residents in the country has increased markedly in recent years. Currently, this figure is estimated to be more than 10 thousand including investors. Mauritian government authorities are still planning to expand the sector by introducing other policies to attract foreigners.

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Tax and contextual assets

Cheaper living environment, the island of paradise has the potential to attract many tourists. But since the Mauritian republic wants to encourage foreign direct investment, it has had to improve its fiscal policy. Foreigners who own real estate in Mauritius will have no tax on heritage. it has been decided that a fixed tax rate of 15% will be applied. For other tax expenditures, purchasers will benefit from an exemption on property tax, home tax or capital gains tax. Of course, all these benefits will be more accessible with different ownership statuses (RES, IRS, PDS). In some cases, such as when the amount of residence reaches a certain level, the buyer automatically becomes a permanent resident (500,000 USD). It is also possible to have a good return on your real estate investment by renting or reselling it at a more attractive price. Profits (capital gains) can be repatriated without any difficulty.

More info on Dream Escapes Properties

http://www.dreamescapes.mu/propertiesweb/google-map-listing/

What are the key issues that need to be addressed before investing abroad?

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Before buying a property abroad, it is best to know the rules governing the real estate market in the host country. We will develop our point of view with the example of three countries located in the Indian Ocean.

Owning a home in a paradise destination tempts you? Before you embark on this new adventure, you must first define your motivations. Do you want to buy a property for your retirement? Make a rental investment? Or benefit from a more favorable tax treaty? Whatever your goal, be clear with yourself. Since tax rules change from one country to another and can have a significant impact on the health of your finances in this gloomy economic climate, you must thoroughly examine the advantages and disadvantages of investing abroad

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How to acquire good property?

Know that each country is different. “In Mauritius, for example, a foreigner can not acquire real estate outside the IRS (Integrated Resort Scheme or RES and Real Estate Scheme, IHS or PDS) program. The IRS programs consist of a luxury apartment or villa accommodation, the price of which varies around 500,000 Euros. Another specificity, Thailand requires that foreigners do not represent more than 49% of the owners of a condominium (a kind of joint ownership). This system can cause serious resale problems when the foreign ownership rate of 49% has already been reached. Promoters or you will have no choice but to find a Thai buyer. In the same country, foreigners can not acquire land but can benefit from a 30-year lease.

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How is the tax treat?

Do not be seduced by the landscape think about resale before signing. Your goals: Know how your potential capital gains will be taxed. “In Mauritius, the tax is 15%.  In Indonesia, they will be taxed at progressive rates ranging from 0 to 37%. Finally, some countries like Thailand do not impose capital gains. ”

How are the income from the property taxed?

Investors should be well informed about the taxation of property income. “In Mauritius, the tax rate is 15%. But in Indonesia, for example, this income is not taxed. Finally, in Thailand, taxation withheld at source of 15% if the income is paid abroad, but they are not taxed when they stay in the country. “You have to take into account so many aspects and situations before buying a property abroad.

Rental investment in Mauritius

The rental is an interesting opportunity for holidaymakers, investors and expatriates during their stay in Mauritius. Luxurious villas, luxury apartments as well as stunning waterfront penthouses are available to those wishing to embark on an investment in Mauritius.

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For individuals

The rental of fully furnished houses or apartments are especially suitable for individuals and expatriates visiting Mauritius. The monthly rent for this type of housing varies between Rs.30,000 and Rs. 85,000 or between 1000 and 2,500 USD. Some investors then embark on the more advantageous relocation of these apartments through a renting pool. Renting Pool is managed by a management company often in partnership with a trustee for maintenance and service. In addition, real estate developers also offer a rental service for housing units when they are unoccupied in a rental pool for a fee and trustee fees. Despite the rarity of the beachfront villas on the Mauritius investment market, their rental prices are offered at prohibitive prices. The units that are available rent between Rs 40,000 and Rs 150,000 per month between 1,200 and 4,200 dollars, per day depending on the number of days. Given the gain in importance for this destination, more and more intermediaries are directing tourists to villas, camps and apartments.

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Professional spaces.

There is currently a decentralization of office space from Port Louis to Ebene, Highlands and Moka. The choice of investors is mainly oriented towards offices all equipped with Internet access and where they can have parking facilities. However, in Port-Louis and Ebène, with the growing number of buildings, it becomes difficult to have access to car parks. This situation leads to a decrease in rents for office space in these regions. The demand for office rental is more important in places like Quatre Bornes or Moka where they can find easier parking facilities. The conversion of houses into office space is also an alternative for those wishing to embark on an investment in Mauritius. Note that commercial spaces are rented monthly per square foot depending on the location, condition and area of the building. In commercial spaces such as the Bagatelle Shopping Mall, spaces are rented at an expensive rates.

Dream escapes properties in Mauritius 

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