Mauritius NRIs · Dividend Tax

Dividend tax on Indian shares for NRIs in Mauritius

Dividends from Indian companies are withheld at the non-resident rate before they reach you in Mauritius. Here's the treaty position and how to reclaim any excess.

When an Indian company pays you a dividend while you live in Mauritius, the company withholds tax at source before the money reaches you. India's default withholding on non-resident dividends is 20% under Section 393(2), the successor to Section 195. The India-Mauritius treaty position is more favourable, capping the rate at 15% for individual residents, a real saving over the 20% default (Article 10). To claim it you need Form 41, the successor to Form 10F, and a Tax Residency Certificate on file with the company or your broker.

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India-Mauritius key facts: dividend tax

Default non-resident TDS rate	20%
India-Mauritius DTAA treaty rate	15%
Your saving via the treaty	5%
Treaty article / basis	Article 10: 15% for individual NRIs (beneficial owner not a company with ≥10% holding)
Your TRC issuing authority	the Mauritius Revenue Authority (MRA)

Rates reflect India's domestic withholding under Section 393(2) (Section 195 until 31 March 2026) and the India-Mauritius treaty. Surcharge and cess apply on top where relevant.

How it works on the India side

Since the 2020 shift back to classical dividend taxation, dividends from Indian companies are taxable in the shareholder's hands and the company deducts TDS before paying. For a non-resident the default is 20% under Section 393(2) (Section 195 until 31 March 2026), plus surcharge and cess, and Section 115A taxes those dividends at 20% of the gross amount with no expenses allowed. A lower rate only ever comes from a treaty, and only where that treaty writes one for individuals: several of India's treaties reserve the reduced dividend rate for companies holding a large stake in the Indian payer, and some countries have no treaty with India at all, so portfolio investors there stay at the domestic rate.

Where a lower individual rate does apply, you claim it with Form 41 (formerly Form 10F) and a Tax Residency Certificate lodged with the company or broker, and any dividend withheld at the higher rate before your paperwork was on file is reclaimed through your Indian return. Where no lower rate applies, the 20% is generally your final Indian tax, so the questions worth asking are whether the payer withheld more than the correct rate and surcharge, and whether the country you live in gives you a credit for that Indian tax.

What changes because you live in Mauritius

On foreign income Mauritius only taxes what actually reaches Mauritius. Indian rent, interest and dividends land on your MRA return in the income year the money is received in Mauritius or is dealt with here in your interest (section 5(3), Income Tax Act 1995), and because Mauritius has no capital gains tax, a share or property sale is not taxed again on this side at all. The trap is in the credit. Under the Income Tax (Foreign Tax Credit) Regulations 1996 the MRA allows the least of the Indian tax you can prove, the amount the treaty lets India charge, and the Mauritius tax on that income, and if you remit only part of the income the credit shrinks to that part. So anything India withheld above the treaty cap is dead in Mauritius, only your Indian return gets it back, and the MRA wants written evidence of the tax India actually deducted, not your own workings.

Frequently asked questions

Common questions from Mauritius NRIs

India's default is 20% under Section 393(2), but the India-Mauritius treaty caps it at 15% for individual residents, a saving of 5%. To get the lower rate you file Form 41 with a Tax Residency Certificate from the Mauritius Revenue Authority (MRA). Any excess withheld beforehand is reclaimed on your Indian return.

Yes. With Form 41 and a Tax Residency Certificate on file, the treaty rate of 15% applies instead of the 20% default, a 5% reduction. Dividends withheld at the higher rate before your paperwork was lodged are reclaimed when you file your Indian return.

Go further

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