Mauritius Trusts for Indian Resident Families

An Indian resident Mauritius trust: two legal systems at once

A family in India that considers a trust in Mauritius is not choosing between two equivalent options. The trust is created and administered under Mauritian law, but the settlor, and often the beneficiaries, remain subject to the rules of the country where they live. Both sets of rules apply, and neither cancels the other.

This page covers the Mauritian side in detail: what the law lets a settlor do, who must act as trustee, how the tax rules treat a trust whose family lives abroad, and what information the trustee must hold on everyone involved. It does not cover Indian exchange-control, tax or succession rules. Those depend on the settlor's residential status, on the assets transferred and on the way the family is organised, and they need advice from a qualified Indian adviser before anything is signed.

The same reasoning applies to a non-resident Indian (NRI). Being an NRI changes the Indian analysis, not the Mauritian one: Mauritian law looks at how the trust is built, not at the passport of the settlor.

If you are still at the stage of understanding the instrument itself, start with what a trust is and the overview of Mauritius trust law.

What Mauritian law allows an Indian settlor to do

The Trusts Act 2001 came into force on 1 December 2001. Its text has been amended since, and the FSC's consolidated version lists the latest amendments it incorporates. The rules below are those that matter most to a family based outside Mauritius.

Two points deserve emphasis for a family abroad.

First, the rule that the settlor cannot be the sole beneficiary prevents a trust from being a mere container for the settlor's own wealth. A trust that gives the settlor everything, with no genuine interest for anyone else, runs against the Act. The related question of how far a settlor may keep control without undermining the structure is covered in how much control a settlor can keep and in the page on sham trusts.

Second, the presumption of irrevocability matters when the settlor is used to holding assets in their own name. Once assets are transferred, they are held for the beneficiaries under the deed. A settlor who wants flexibility must have it written into the deed, and the drafting of those clauses is a point for the family's advisers. See revocable and irrevocable trusts for the trade-offs.

Foreign settlors and succession rules

Section 8 also addresses a worry many foreign families have: the transfer made by a settlor who is not a Mauritian citizen cannot be set aside under the succession rules of that settlor's domicile or nationality. That is a statement about how Mauritian law treats the transfer. It does not bind an Indian court or an Indian authority, and it does not tell you how Indian law would view the same transaction. Whether the transfer would be respected in India is a question for Indian counsel.

Section 60 adds a limit that works the other way. A foreign trust is governed by its own terms and its own law, but it cannot be enforced in Mauritius where that would amount to an offence, would be contrary to public policy, or would apply directly to immovable property situated in Mauritius. Choosing the governing law is therefore a real decision; see choosing the governing law of a trust and how Mauritius recognises foreign trusts.

Where the trustee, protector and enforcer fit

An Indian family will not run the trust from Mauritius. The qualified trustee does that. The practical question is what role the family keeps.

A protector may be appointed under section 24. Unless the deed says otherwise, the protector can remove and appoint trustees, change the governing law, change the place of administration and withhold consent to certain acts, without becoming a trustee. That is a significant lever. A family should decide carefully who holds it, and whether the settlor should. The pages on the powers of a protector and on whether the settlor can be the protector explain the consequences.

Tax in Mauritius when the family lives in India

The Mauritian tax position of a trust is not a matter of declaring non-residence and walking away.

• Section 46(2) of the Income Tax Act still describes a trust whose settlor is non-resident (or holds a Global Business Licence) and whose beneficiaries are all non-resident (or holders of a GBL), as well as a purpose trust whose purpose is carried out outside Mauritius. Such a trust is nevertheless taxed at the same 15% rate under Part IV.
• The Finance Act 2021 repealed section 46(3), the exemption that non-resident trusts could obtain by filing a declaration of non-residence within 3 months after the end of the income year. The repeal is deemed effective from 1 July 2021, and the exemption does not appear in the consolidated Act through the Finance Act 2026.
• Under section 46(4), any distribution to a beneficiary of a trust is deemed to be a dividend in the beneficiary's hands. The former paragraphs on deducting distributed income and exempting a non-resident beneficiary have been removed.

Older material that describes a Mauritius trust as automatically free of Mauritian tax for non-resident families is therefore out of date. For the current rules, see how trusts are taxed in Mauritius and tax for non-resident beneficiaries. How India would tax the settlor, the trust or the beneficiaries on the same facts is a separate analysis that Mauritian rules do not answer.

Where the trust is managed matters

The trust is the main vehicle, but families often add a company underneath it to hold investments. Residence rules for companies then come into play.

A company is resident in Mauritius if it is incorporated there or if its central management and control are there (Income Tax Act, section 73). A Mauritian company that is centrally managed and controlled outside Mauritius is treated as non-resident (section 73A), but it must still file an income tax return under section 116. A company that sits under a trust but is run from India is not automatically outside the net of either country; the place where decisions are really taken is a question of fact.

The Financial Services Act also draws a line between two vehicles:

An Indian family should not choose between these on cost alone. The licence category, the real place of management and the Indian treatment of the same company need to line up.

Information the trustee will hold, and who sees it

A family used to private arrangements should expect transparency obligations at the trustee level.

• The trustee must keep up-to-date accounts and records, and an alphabetical register of the names and last known addresses of each beneficiary and settlor. This applies even to a non-resident foreign trust the trustee administers (section 38(3)). Accounting records are kept for at least 5 years after the operations concerned are completed.
• Under the anti-money-laundering law (FIAMLA 2002, in the version published by the Financial Intelligence Unit in 2026), the beneficial owners of a trust-type legal arrangement include the settlor, the trustee, any protector, each beneficiary (or the class of beneficiaries and objects of a power) and any other individual exercising ultimate effective control, including through a chain of control.
• The FSC publishes Practice Notes for qualified trustees and corporate service providers on keeping beneficial ownership information current.
• Section 26A of the Financial Services Act requires the FSC to keep a register of domestic trusts and of foreign trusts that have at least one qualified trustee. It holds, among other things, the trust deed and amendments, the identity and addresses of beneficiaries, trustees, settlors, protectors and enforcers, the governing law and the place of administration.

This register is not public. For what it means in practice, read the register of trusts and trust confidentiality. The family should assume that a Mauritian trustee will ask for full identification of every person above and will keep it up to date.

A foundation as another option

Some families ask whether a Mauritius foundation avoids the points above. It does not remove them. A foundation has legal personality, a charter and a council. Under section 17 of the Foundations Act 2012, the council must include at least one member habitually resident in Mauritius, and section 13 requires a secretary who is an FSC-licensed corporate service provider (Management Licence) or another person resident in Mauritius authorised by the FSC. The Finance Act 2021 also repealed paragraphs 49A(2) and (3) of the Income Tax Act, the non-residence exemption for a foundation whose founder and beneficiaries are all non-resident, with effect deemed from 1 July 2021.

A comparison with the trust is in trust vs foundation.

Residence and immigration are separate questions

A trust does not give anyone a right to live in Mauritius, and moving to Mauritius is not required to create one. For families who also consider relocating, note that the rules have recently changed. Act 13 of 2026, promulgated on 12 August 2026, removes the Family Occupation Permit category, which required a contribution of USD 250 000 to the COVID-19 Projects Development Fund. It also introduces a mandatory digital travel authorisation before admission to Mauritius, and defines the Golden Visa as a visa issued on the recommendation of the Economic Development Board to a non-citizen who commits to investing at least USD 1 million within the first 12 months of stay. EDB guidelines dating from 2022 (to be reconfirmed for 2026) set a residence-permit threshold of USD 375 000 for property under the IRS, RES and PDS schemes. These are immigration matters; they should be checked with the EDB or an immigration adviser, not inferred from the trust rules.

Steps for an Indian resident family

Checklist before you speak to a trustee

• Confirm the settlor's residential status for Indian purposes, and that of each beneficiary
• Obtain written Indian advice on whether and how the transfer may be made
• List the assets to be transferred and where they are held
• Decide who will be trustee, and confirm they are a qualified trustee
• Decide whether a protector is wanted, and who it will be
• Decide whether the trust should be revocable, and have that written in the deed
• Choose the governing law and place of administration
• Gather identification for the settlor, beneficiaries and anyone with control
• Plan the annual review with the annual trust review checklist

To discuss your situation with a licensed provider, use the contact form.