Isle of Man Offshore Companies
The Isle of Man is part of the British Crown but has been given self-rule and self-governance status. As such the present laws here will be tighter than places like Panama which don’t have to abide by EU laws and amendments. This state lies at the center of the British Isles in the Irish Sea.
The Isle of Man Advantages
The primary benefit of incorporating in the Isle of Man is that the company is required to pay 0% tax on trading and investment incomes. There is a customs & excise agreements with the United Kingdom which allows both the territories to be treated equally in matters of VAT, customs and other excise duties. Thus it makes sense to incorporate in the Isle if the purpose of the company is to trade in the EU, and thus save a lot of Value Added Taxes.
Common Isle of Man Offshore Companies:
Companies that are holding investment, e.g. portfolios, UK commercial properties and shares of other companies – tax-free activities
Improved trading facilities within the EU due to the 0% tax and the ability to quote a European Union accepted Value Added Tax number;
Companies that are engaged in or own intellectual assets as the Isle of Man has signed the Paris Convention on Patents and Trademarks for Intellectual Property protection.
Company Formation in the Isle of Man:
Once the name gets approved by the Company Names’ Registry, it usually takes no more than 4-5 days. Only Limited, Ltd, Public Limited Company or PLC suffixes are allowed.
A single shareholder can incorporate a company, that too with a single share with zero par value. Minimum of 1 director is needed and they can be of any nationality or domicile.
Annual Accounting Reports in the Isle of Man:
The companies are required to file annual returns unlike other offshore-centres. The directors are held responsible for preparing and the registered agent is responsible for filing of returns
Company accounts are not mandatory but the registered agent within the Isle should keep records.
If any two out of the following three criteria are met by a company, then it need not have its accounts audited.
– Annual Turnover is GBP 5.6 million or less
– Balance Sheet total is GBP 2.8 million or less
– Average number of employees is less than or equal to 50
All companies are however required to file company tax return at the Isle Treasury. All Isle of Man companies are considered as resident companies today. Resident companies are levied a tax rate of 0% on their income from trading and investment activities. Land and Property Income from real estate on the Isle of Man is taxed at 10% rate.
Law and Governance
The Isle of Man legal system is based on the English common-law model. The agents are required to observe care in preserving the internal file on the company directors and shareholders. Such documentation needs to be provided with valid ID proofs.
