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Taxation
Taxation Details for the Isle of Man
The Isle of Man is a well known low tax area offering low or zero rates of
direct taxation for individuals and companies. It is also an award
winning well regulated offshore financial services centre.
The Isle of Man relies upon a small number of taxes, namely: income tax,
national insurance (a social security tax), rates (a form of property tax)
and VAT (value added tax).
The Isle of Man does not have any capital gains tax, wealth tax or
inheritance tax.
Individuals
Income tax is levied at a rate of 10% on the first £10,300 of taxable
income and 18% on the rest. Individuals receive an £8,500 personal
allowance. Married couples are taxed jointly and receive a personal
allowance of £17,000, pay 10% on the first £20,600 of taxable
income and 18% on the rest.
National Insurance is a form of social security taxation. It is levied on
employment income at a slightly lower rate than the UK. For employees the
rate is 10% on income between £89 and £595 per week. Various other
rates are levied on the self employed etc.
Rates are a form of property tax and are based on a notional house value
multiplied by some number set by the local authority. They are the
primary source of income for local councils.
VAT is charged at 17.5% on the value of an item. Prices displayed in
shops already include this tax. There are some variations but generally
the tax is applied in a similar manner to the UK.
Companies
As of April 2006 most trading companies will pay income tax at 0% on
their profits. Companies beneficially owned by residents of the Isle
of Man may be subject to DPC (Distributable Profits Charge) if a
substantial proportion of the profits of the company are not distributed
to shareholders. Non trading companies pay 18% tax on profits.
Most companies with a turnover of £55,000 or more are required to
register for VAT. The Isle of Man VAT regime is controlled by the Isle
of Man's own Customs and Excise department. The Isle of Man is the only
offshore centre in the EU VAT regime. VAT is charged at 17.5% on most
sales.
The main employment tax is National Insurance and is levied at a rate of
12.8% on earnings above £89 per week.
The Isle of Man does not operate IR35, or any equivalent scheme.
| Publications |
Tolley's Taxation in the Channel Islands and the Isle of Man
Guernsey BGL Reads Ltd, Isle Of Man BW Group, PricewaterhouseCoopers
Tolley Publishing, Paperback, September, 2003
ISBN: 0754521893
List Price: £59.95
New Price: £61.94
Third Party Price: £49.99
Buy Now
More Info
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Tolley's Taxation in the Channel Islands and the Isle of Man
PricewaterhouseCoopers
Tolley Publishing, Paperback, September, 2002
ISBN: 0754516709
List Price: £59.00
Buy Now
More Info
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