Y Ltd, a domestic company, specializes in land development. His latest project is to develop villas for short-term rental.

The directors have mandated finctax for the tax compliance needs of the company. First, they asked us to assist them with their annual and quarterly tax returns only. In preparing for the Corporate Returns, we questioned Source Deductions (“SIR”) on invoices received and issued by the company.

Following further discussions with the customers, they hired us to deal with the company’s RAS as well as their Value Added Tax (“VAT”) compliance, having realized the time they would gain.

Therefore, with respect to the SAR, we reviewed invoices before they were issued to assess whether there was a need to withhold tax at source from payments made by the corporation. We always make sure to respond quickly regarding SIR reviews on invoices so that we don’t delay payments due to response time. We then declare the SIR if applicable/if applicable.

In terms of VAT, we first registered the company for VAT, which includes contacting the Mauritius Revenue Authority (“MRA”) to obtain the registration certificate. We prepare VAT returns on a quarterly basis and, once approved by the directors, we submit them on behalf of the company.

Anyone in the field of land development could attest to this, funding during the construction phase of a building can be problematic. Any refund of VAT during this period would be welcome, as was the case for Y Ltd. The company is currently awaiting a refund from MRA. Part of our job is to look at the invoices to make sure they meet the terms of the MRA to be considered real invoices with VAT.

An incorrect VAT claim can result in penalties while a delay by the authorities in the refund gives a registered person a right to receive interest on any refund. We prepare and submit refund claims on behalf of the company. The review of invoices undertaken by finctax was critical to anticipate MRA issues. We followed the MRA’s response to ensure a timely and correct refund.