PAYE, CSG, and TDS in Mauritius — A Quick Guide for Employers

Running a business with employees means dealing with three major payroll obligations: PAYE, CSG, and TDS. Each has its own rules, rates, and deadlines. Missing any of them can result in penalties from the Mauritius Revenue Authority. Here is a practical overview of what you need to know.

PAYE — Pay As You Earn

PAYE is the income tax your business deducts from employees' salaries each month. It is the most common form of income tax collection in Mauritius. As an employer, you are responsible for:

Calculating the correct PAYE for each employee based on their annual taxable income.
Deducting PAYE from their monthly salary before payment.
Remitting the deducted amount to the MRA by the 20th of the following month.
Filing an annual return (Form IR12) for each employee by 31 March.

The progressive tax rates for individuals are (source: MRA):

Up to Rs 390,000 — 0%
Rs 390,001 to Rs 430,000 — 15%
Rs 430,001 to Rs 815,000 — 20%
Rs 815,001 to Rs 1,790,000 — 25%
Over Rs 1,790,000 — 30%

The personal allowance of Rs 390,000 means your employees pay no income tax on the first Rs 390,000 of their annual salary.

CSG — Contribution Sociale Généralisée

CSG is a social security contribution paid by both employers and employees. It funds social protection benefits. The current rates are (source: MRA):

Employer contribution:3% of the employee's gross salary (for earnings up to Rs 50,000 per month).
Employee contribution: 1% of gross salary (for earnings up to Rs 50,000 per month).

CSG contributions are calculated on the gross salary before any deductions. The employer's share is an additional cost on top of the salary — it is not deducted from the employee's pay.

Employers must register for CSG with the MRA and submit returns monthly. Late submissions attract penalties.

TDS — Tax Deducted at Source

TDS applies to specific types of payments your business makes to others — not just salaries. If you pay for professional services, rent, commissions, or certain contracts, you may be required to deduct tax before making the payment. See the MRA for full TDS obligations.

Common TDS rates include:

Professional fees, royalties, and management charges: 10%.
Rent: 10%.
Commissions to agents: 10%.
Contract payments to non-residents: 10% (or treaty rate).

The person or entity receiving the payment can offset the TDS against their own tax liability when they file their return. Your role is to deduct correctly, remit to the MRA on time, and issue a certificate to the payee.

Key Deadlines

PAYE and CSG remittance: by the 20th of the month following the payroll period.
TDS remittance: by the 20th of the month following the deduction.
Annual PAYE return (IR12): by 31 March for the previous year.
Annual CSG return: as specified by the MRA each year.

Penalties for Late Payment or Non-Filing

The MRA imposes penalties on employers who fail to comply:

20% surcharge on the amount of tax not paid by the due date.
Interest accrues on unpaid amounts from the due date.
Prosecution in serious cases — late payment of PAYE is a criminal offence under the Income Tax Act.

The best way to avoid penalties is to set up a reliable payroll system and schedule reminders for each deadline.

Keeping Track with Fanal

While Fanal is primarily an invoicing tool, staying on top of your invoicing accuracy means your cash flow is predictable — making it easier to meet your PAYE, CSG, and TDS obligations on time. When your invoicing is automated and compliant, payroll runs smoother too. Get started free.