Company Formation in the Isle of Man
The Isle of Man is a dependency of the British Crown. It is not part of the European Union and the European Economic Area. Still, it trades with EU countries under the rules of the Union regarding customs duties, excise taxes, and VAT. Therefore, setting up a company in Douglas or any other city in the Isle of Man allows access to the benefits of the internal European market. Due to the progressive legislation, the jurisdiction has a positive reputation. Registering a firm in the Isle of Man will allow the entrepreneur to engage in various activities, including owning real estate and managing assets. Due to the existence of information exchange and double taxation agreements, the jurisdiction is on the allowlist of the OECD.
WHY REGISTER A COMPANY IN THE ISLE OF MAN
- the possibility of duty-free trade with the UK and EU countries;
- a good reputation of the jurisdiction;
- no direct taxation of most companies in the Isle of Man;
- possibility to establish a company with one shareholder and any size of share capital;
- availability of qualified specialists;
- low tax rates;
- English-speaking environment.
HOW TO REGISTER A COMPANY IN THE ISLE OF MAN
- choose and reserve a company name through the Registry of Companies;
- register a company in the Isle of Man;
- open a corporate bank account;
- obtain the necessary permits and licenses.
- corporate tax – 0% (for most companies), 10% (for banking and retail trade), 20% (for real estate transactions);
- PIT – 20%;
- VAT – 20%;
- dividend tax – 0%;
- tax on capital gains – 0%.
There is also no inheritance tax on the island, which makes registering a company a tax-efficient way to own real estate.
All companies must file tax returns for the reporting period, regardless of the rate at which they are taxed. The Isle of Man resident companies are taxed on their worldwide income. Non-resident companies doing business on the island pay taxes only on income earned on its territory.
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