Key Takeaways
- Employers operating in Mauritius are responsible for payroll-based charges, including CSG, NSF and PRGF contributions.
- Defining the covered earnings base correctly determines how employee and employer shares are calculated each pay period.
- Registration, scheduled remittance and accurate filing are required to avoid penalties for late or incorrect payments.
- Recent reforms continue to shape the outlook, so foreign-owned businesses should review their payroll obligations regularly.
Understanding Payroll Tax in Mauritius
Mauritius does not levy a single, free-standing payroll tax in the manner some countries do. Instead, an employer's wage-based obligations are made up of several distinct charges: the Contribution Sociale Generalisee (CSG), National Savings Fund (NSF) contributions, the Skills Development or Training Levy, the Portable Retirement Gratuity Fund (PRGF), and income tax withheld through the PAYE system. Taken together, these employer contributions add roughly 12.5% to 15.5% on top of an employee's gross salary, with around 14.5% a common working estimate.
For a foreign business hiring staff on the island, payroll tax in Mauritius means understanding each of these components, who pays what, and when remittance falls due. This guide explains the rates, the contribution bases, registration, filing deadlines, and the penalties for getting it wrong. It is written for non-resident owners and their advisers who employ, or plan to employ, people locally. The Mauritius Revenue Authority publishes the monthly return system through which most of these obligations are met.
The Legal Basis for Payroll-Based Charges on Employers
Several statutes underpin these wage levies rather than one consolidated payroll law. The Finance Bill 2020 abolished the National Pensions Fund effective 1 September 2020 and put the CSG in its place, while the National Savings Fund Act 1995 governs NSF contributions.
The PRGF derives from the Workers' Rights Act 2019, with its operational detail set out in the Workers' Rights (Portable Retirement Gratuity Fund) Regulations 2020. Later adjustments to gratuity reporting arrived through the Finance Act 2023, working via Section 95(2A)(d) of the same Act.
A separate Training Levy applies from 1 July 2021, requiring every employer to pay 1.5% of total basic wages, excluding household workers. As a baseline obligation, each employer must register with the Mauritius Revenue Authority (MRA) and withhold income tax from emoluments at the moment payment is made.
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Contribution Sociale Generalisee (CSG): Rates and Application
CSG took over from the old pension fund on 1 September 2020 and now sits at the centre of the contribution system. Every participant and their employer is liable at prescribed rates, covering employees and the self-employed, whether full- or part-time; public sector employees fall outside the participant definition and follow a separate regime.
For private sector workers, the rate depends on monthly earnings. Where an employee earns up to MUR 50,000 a month, the employee pays 1.5% and the employer 3%; above that threshold, the employee pays 3% and the employer 6%.
CSG applies to the full remuneration figure with no upper cap, so high salaries attract proportionally higher contributions than under capped levies.
Sugar sector employers, once subject to a heavier 10.5% charge under the former fund, now contribute at the standard CSG rates. Despite reported strain on the fund through 2024 and 2025, the published rates remain unchanged.
National Savings Fund (NSF) Contributions
The NSF, established in 1995, pays benefits calculated on the length of employment and contributions made. Employees contribute 1% of basic salary and employers 2.5% of total remuneration.
Unlike CSG, the NSF carries a wage ceiling that the MRA reviews annually. For the general "other sectors" category, the published monthly ceiling is MUR 28,570, effective from 1 July 2025, with a table of minimum and maximum basic wages applying from 1 July 2024 onward.
Some workers fall outside the contribution net. No NSF is payable for an employee who has reached retirement age, and exemptions also cover employees under 18 or over 70, alongside non-Mauritian staff in export manufacturing during their first two years of employment.
For pay periods from August 2018 onward, the retirement age stands at 65 and the final retirement age at 70. Contributions begin from the month an employee starts work.
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The Mauritius Portable Retirement Gratuity Fund (PRGF) Levy
The PRGF exists to pay a gratuity on a worker's retirement or death, recognising total service regardless of how many employers the person has worked for. Mandatory employer contributions began in January 2022, the obligation having been suspended between January 2020 and December 2021.
The standard rate is 4.5% of the employee's monthly remuneration, borne entirely by the employer. Smaller firms had relief in the transitional window: SMEs with annual turnover not exceeding MUR 50 million, outside the service sector, paid reduced rates from January 2022 to December 2024, after which the full rate applies to all.
Several categories sit outside PRGF eligibility:
- Job contractors, migrant workers, and non-citizens
- Employees covered by the Statutory Bodies Pension Funds Act or the Sugar Industry Pension Fund Act
- Workers whose retirement benefits come from an FSC-approved private pension scheme
- Anyone earning more than MUR 200,000 per month
Where an employer already funds an FSC-approved private pension scheme for a worker, no parallel PRGF contribution is required for that person. The gratuity itself is set at 15 days' remuneration for each completed 12 months of continuous service, and the MRA collects, enforces, and remits contributions to the fund administrator. Bowmans sets out the employer obligations in detail.
Defining the Contribution Base: Which Earnings Are Covered
Each levy measures a different slice of pay, so the figure you apply a rate to changes from one charge to the next. Knowing the correct base prevents both underpayment and overpayment.
| Levy | Base measured | Ceiling |
|---|---|---|
| CSG | Gross monthly remuneration | None |
| NSF | Basic salary | MUR 28,570/month (from 1 July 2025) |
| Training Levy | Full basic wage or salary | None |
| PRGF | Monthly remuneration incl. bonuses | Excludes pay above MUR 200,000/month |
| PAYE | All employment income | None |
For PRGF, monthly remuneration means basic wages plus any productivity bonus, attendance bonus, and payment for extra work. PAYE casts the widest net: salary, wages, leave pay, fees, overtime, perquisites, allowances, bonuses, gratuities, commissions, benefits in kind, and annuities all count as employment income.
One notable exemption applies to travel. Passages by sea, air, or land between the island and another country provided under a contract of employment are exempt up to 6% of basic salary.
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Employer Registration for Payroll Contributions
Registration with the MRA is the first step before any wages are paid. Once registered, an employer must operate the PAYE system, deducting income tax and the employee shares of social contributions when wages are paid and remitting them by the end of the following month.
Your Employer Registration Number (ERN) doubles as the User ID for the MRA e-filing platforms, covering both the joint CSG/NSF returns and the separate PRGF returns. The MRA allocates a password for access.
Payment runs through a single mechanism. Employers and the self-employed must use only the Direct Debit facility to pay PAYE, CSG, NSF, and the Training Levy directly from a bank account.
Complete the PLACH Direct Debit Mandate Form and lodge it with the MRA Head Office at least 15 days before your first payment due date, or you risk missing the deadline.
Calculating Employee and Employer Shares
Working out the split between employer and employee means applying each rate to its own base. The table below brings the components together.
| Levy | Employee | Employer | Base | Ceiling |
|---|---|---|---|---|
| CSG (private, up to MUR 50k) | 1.5% | 3% | Gross remuneration | None |
| CSG (private, above MUR 50k) | 3% | 6% | Gross remuneration | None |
| CSG (public, up to MUR 50k) | Separate regime | 4.5% | Gross remuneration | None |
| CSG (public, above MUR 50k) | Separate regime | 9% | Gross remuneration | None |
| NSF | 1% | 2.5% | Basic salary | MUR 28,570/month |
| Training Levy | 1% | 1.5% | Basic salary | None |
| PRGF | Nil | 4.5% | Monthly remuneration | Below MUR 200,000/month |
Employees carry their own CSG and NSF shares, which come out of pay alongside income tax. The employer deducts and remits all of it.
PAYE follows a cumulative method. You annualise the employee's monthly income, subtract applicable allowances and deductions, compute the yearly liability, and divide by 12, cumulating both emoluments and the Income Exemption Threshold across pay periods in the income year.
Remittance Schedules and Filing Obligations
Most payroll obligations follow a monthly rhythm, with electronic returns and payments due by the end of the month after the one in which wages were paid. A joint PAYE/CSG/NSF return covers those three charges together.
PRGF runs on its own return. Contributions and returns should be filed electronically, and practitioners should confirm the exact deadline with the MRA: published guidance points to the end of the following month, while some sources cite the 20th of the following month.
Several other filings apply across the year:
- An annual PAYE return on Form TD1, summarising total emoluments and PAYE deducted, generally due by 15 July after the income year ends on 31 December
- An income statement on Form TD3 to each employee by 15 July following the income year
- Where a retirement gratuity has been paid, a return to the MRA within 15 days of payment
Self-employed persons gain an option from financial year 2025/2026: they may settle the full CSG for a financial year in advance, no later than 15 October. The MRA also amended the Statement of Emoluments format to capture PRGF contributions, effective for the income year ended 30 June 2025.
Penalties for Late or Incorrect Payroll Contribution Payments
Late or missing payments draw penalties that differ by levy. The amounts can mount quickly, since most accrue monthly.
| Levy | Penalty | Interest or surcharge |
|---|---|---|
| CSG | 10% of unpaid amount | 1% per month interest, plus 5% monthly surcharge up to 100% |
| PAYE | 5% of unpaid tax | 1% per month while tax remains unpaid |
| PRGF (non-payment) | None stated | 5% surcharge per month or part-month |
| PRGF (monthly return late) | None stated | 1% of contributions per day until filed |
| PRGF (yearly return late) | None stated | MUR 500 per day until filed |
Across these charges, monthly surcharges can run to 5% and are generally capped at 100% of the amount due. Sustained non-compliance also exposes a business to enforcement action by the MRA.
Recent Reforms and Outlook for Payroll Contributions
The shift from the National Pensions Fund to the CSG on 1 September 2020 was the most consequential payroll-contribution change in decades. The arrival of mandatory PRGF contributions in January 2022, followed by the end of SME transitional relief in December 2024, has steadily widened the employer cost base.
Two newer measures sit alongside the payroll regime, though they target income rather than wages directly. A 15% Fair Share Contribution applies from 1 July 2025 to 30 June 2028 on individuals with annual net income above MUR 12 million, replacing the former Solidarity Levy. From the year of assessment beginning 1 July 2024, a 2% CCR Levy applies to companies and resident societes with turnover above MUR 50 million.
Larger multinational groups face a separate development. A Qualified Domestic Minimum Top-up Tax of 15% applies to groups with global revenue above EUR 750 million, aligned with OECD Pillar Two.
For employers, the open question is the CSG itself. Business groups warn that rates may need to rise to sustain benefits, and a pending Supreme Court case on the fund's constitutionality could force structural change.
Conclusion
Getting the earnings base right is the single technical decision that flows through every other payroll obligation a foreign employer carries in Mauritius, because an error there compounds across CSG, NSF and PRGF simultaneously. The penalty exposure that follows a miscalculation is not a remote risk but a built-in consequence of the remittance schedule, which means the next concrete step for any non-resident business owner is a precise review of how covered earnings are currently defined in their payroll setup, not a general compliance audit.
How Expanship Can Help Your Business in Mauritius
Expanship handles the payroll obligations described here from end to end: employer registration with the MRA, monthly CSG, NSF, Training Levy and PRGF returns, PAYE withholding, and the annual TD1 and TD3 filings. The same team supports the wider needs of a foreign-owned entity, so you can run local employment without maintaining your own administrative base on the island.
- Company formation and structuring for non-resident owners
- Registered agent and registered office services
- Tax registration and ongoing return filing
- Payroll administration and contribution management
- Accounting and bookkeeping
- Introductions to local banking
To discuss employing staff or setting up an entity, contact Expanship Mauritius for tailored support.
Frequently Asked Questions
No. Employer wage obligations consist of several separate charges, chiefly CSG, NSF contributions, the Training Levy, the PRGF, and PAYE income-tax withholding. Combined, these add roughly 12.5% to 15.5% on top of gross salary, often estimated at around 14.5%.
For a private sector employee earning up to MUR 50,000 a month, the employer pays 3% and the employee 1.5%. Above MUR 50,000, the employer rate rises to 6% and the employee rate to 3%, applied to full remuneration with no ceiling.
Job contractors, migrant workers, non-citizens, and employees earning above MUR 200,000 per month are excluded, along with those covered by certain statutory or sugar industry pension funds. Workers whose retirement benefits are paid under an FSC-approved private pension scheme also fall outside the PRGF.
The joint PAYE, CSG, and NSF return is filed electronically and paid by the end of the month following the month of withholding. PRGF returns follow a similar monthly cycle, and you should confirm the precise PRGF deadline directly with the MRA.
Yes. NSF contributions are calculated on basic salary up to a monthly ceiling that the MRA reviews each year, set at MUR 28,570 for the general category effective 1 July 2025. CSG, by contrast, has no such cap.
Penalties vary by levy: CSG attracts a 10% penalty plus 1% monthly interest and a 5% monthly surcharge, while PAYE carries a 5% penalty plus 1% monthly interest. PRGF non-payment draws a 5% monthly surcharge, with daily penalties for late returns, and surcharges are generally capped at 100% of the amount owed.
Legal Disclaimer
The information provided in this article is for general informational purposes only and does not constitute legal, tax, or professional advice. While we strive to ensure the accuracy and timeliness of the content, laws and regulations are subject to change, and the application of laws can vary widely based on specific facts and circumstances.
Readers should not act upon this information without seeking professional counsel tailored to their individual situation. Expanship and its authors disclaim any liability for actions taken or not taken based on the content of this article.
For specific advice regarding your business setup, compliance requirements, or any legal matters, please consult with qualified legal and tax professionals in the relevant jurisdiction.
