Relocating your business to the Isle of Man (Practical Guide)

There are a lot of good reasons to relocate to the Isle of Man. We have great schools, fabulous scenery, a caring community, a friendly tax regime, good travel connections, robust Internet connectivity as well as a sensible business minded Government. All of this means we enjoy an unsurpassed quality of life both personally and professionally.

The days of legitimately avoiding tax by setting up fancy, tax counsel approved networks of brass plate companies are truly behind us; these days effective robust tax planning requires real substance and frequently that will involve moving yourself and of course your loved ones as well as your business itself to a friendlier jurisdiction like the Isle of Man.

Moving to the Isle of Man is easy.

Immigration. EU passport holders are welcome to live in the Isle of Man; unlike the Channel Islands there are no residency requirements. Non EU nationals are able to apply for visas based on certain criteria. Isle of Man visa holders benefit from the Isle of Man being a part of the UK Common Travel Area (CTA) which covers UK, Ireland and the Channel Islands. This is important because it means Isle of Man visa holders are not restricted to residence / travel in the Isle of Man. Our immigration legislation closely mirrors that of the UK but is not identical so local Isle of Man advice is recommended. Please see further information in our practical guide to Isle of Man immigration.

Housing and residency – At 527 Sqkm – (221 Sqm), we have space to breathe in the Isle of Man; Jersey has more people squeezing into a very claustrophobic 118 Sqkm. We have a plentiful stock of reasonably priced quality housing. Unlike the Channel Islands there are no special permits required to buy houses anyone with the right of abode in the UK (or EU) can buy a house and live in the Isle of Man. The largest estate agents on the Island are Black Grace Cowley, Dean Wood, Cowley Groves and Chrystals. We know all of them so feel free to ask us for a personal introduction.

Business premises. There is plenty of office accommodation available in Douglas and elsewhere on the Island. Middleton Katz operates MK Hub a small informal business centre which is available to our friends and clients for occasional informal hot desking. Alternatively Black Grace Cowley are the Island’s largest commercial agent – ask us for an introduction to Sharon.

Work permits – There is a work permit system in place. Most of our clients tend to be entrepreneurs and for these people who can demonstrate a positive economic impact on our economy, special rules apply which mean the application should be, more or less, a formality. There is information about work permits here; however, they are helpful so if in doubt you can contact them on +44 1624 682393 or email them at workpermit@gov.im

VAT and Europe – the Isle of Man is part of the UK for VAT purposes – although we have our own Customs and Excise division based at the steam railway station that administers Isle of Man registered traders. We are within the European customs union for the purposes of free movement of goods and most services (excl financial services). Contact Isle of Man Customs and Excise.

Corporate Tax – the usual tax rate on company profits in the Isle of Man is zero % (not a typo). There are one or two exceptions to this…banks, local rents and substantial retailers are subject to different rules – but in most cases zero % is the applicable rate. There are employment taxes to consider (employers NI) and VAT applies. Read our Article – Tax, NI and all that – Choosing an Isle of Man Corporate Entity. The Income tax department are also generally pretty helpful at answering queries by telephone on +44 1624 685400.

Personal Tax – personal tax is levied on worldwide income (no remittance basis). The personal allowance is £9500 and then earned income is taxed at 15% (next £10,500) with a 20% flat rate above that. Investment income – eg bank interest is all taxed at the 20% flat rate. Most importantly – there is no capital gains tax and no inheritance tax. The very rich can also apply to be ‘tax capped’ which means their income tax liability is capped at £120K regardless of the level of their income. For more information about personal taxation in the Isle of Man contact my colleague Kevin Mort.

Legal System – We have an independent legal system but it is heavily influenced by English common law so will seem very familiar to those used to the UK system. The regime has a reputation for being even handed, efficient and relatively cost efficient. A full list of Advocates can be found on the law society website; we can also personally introduce you to our favourite ones.

Company law. The Isle of Man has a very well developed and comprehensive framework for company law which anticipates share capital companies, US style LLCs, Foundations as well as limited partnerships. You can find information about incorporating Isle of Man Companies here; alternatively feel free to contact Martin Katz by telephone on +44 1624 648500 or by email – mk@middletonkatz.com. The Isle of Man Companies Registry are also extremely efficient and helpful and can be contacted by telephone on +44 1624 689389.

Communications – The Island enjoys a world-class and highly resilient telecoms and electricity infrastructure with a network of new data hosting centres. We have 2 telephone companies – Sure and Manx Telecom and a number of quality data centres including Domicilium who provide an excellent service and are based near the airport. Ask us for an introduction.

Isle of Man Government Business Support Schemes. The Island’s Department of Economic Development (“DED”) does a good job of promoting to Island’s economy and administers several generous financial support schemes. These include the new Enterprise Development Scheme – which specifically includes a business relocation category, the Business Support Scheme and the Financial Assistance Scheme. We will be pleased to make an introduction for you to the correct person at DED; alternatively you can contact them directly by telephone on 44 1624 687333.

When it comes to relocation, a bit of local knowledge goes a long way.

At Middleton Katz we take pleasure in sharing our local contacts and knowledge with new and potential residents to show them the ropes to make their move to our Island as straightforward as possible.

As well as the items on this list, we can also introduce you to reliable local trades people, help you open a local bank account, or even point you in the direction of our favourite Eateries.

For an informal discussion about moving to the Isle of Man, please contact Martin Katz.

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