The Isle of Man is an extremely stable self-governing British dependent territory, located in the Irish Sea at the geographical centre of the British Isles with a legal system based on English common law.
It is not and has never been part of the United Kingdom but is technically a Crown Dependency and is independent in all matters except foreign affairs and defence, both of which are the responsibility of the United Kingdom Government and for which the Isle of Man pays an annual contribution.
The Isle of Man is politically and legislatively independent of Great Britain; It boasts its own Westminster style of Parliament (known as the Tynwald) which is the oldest legislature in the world in continuous existence.
The Isle of Man (“IOM”) Company law historically is based on English Company Law but, so as to better compete in an expanding global marketplace, the IOM Government introduced new corporate legislation in 2006 with the introduction of “2006 Act Companies“, to complement the existing company legislation. The new Company Law is more geared towards flexibility and simplicity.
Companies incorporated in the Isle of Man must comply with the Companies Acts and regulations in force which guarantees that high standards of Corporate Governance for all IOM Companies (including the filing of an annual return ie annual accounts must be provided to the IOM Government’s Income Tax Division).
Isle of Man registered companies are the conventional form of business entity for the purposes of conducting local and international business from the Island and enjoy numerous benefits including:
- · Separate legal personality
- · Can be incorporated either as a Private Limited Company or as an LLC
- · Provided the Company is not being set up (a) to provide banking services or (b) to own/operate a local retail business or (c) to do local real estate business a 0% corporate tax applies in IOM. (If structured correctly an IOM Company can enable you to bank worldwide profits without having to pay Corporation tax)
- · No capital gains tax, inheritance tax or stamp duties
- · No Exchange Controls
- · Bank Accounts can be opened for IOM Companies in the IOM with reputable international banks
- · There are no authorised or issued share capital requirements + shares may be issued
- · Ease of incorporating an Isle of Man company (usually within 3 working days subject to satisfactory due diligence)
- · The Isle of Man is part of the EU’s Customs Union making it ideal for businesses looking to do business in Europe (a UK VAT number can be obtained)
- · Provided there are no local shareholders there is no tax levied in IOM on retained profits
- · No requirement to specify a company’s objects in the Memorandum of Association so a company is not restricted in its business activities
- · Third parties take comfort from the similarities to English company law
- · Only 1 Director is required
- · A Non IOM resident can be appointed as Company Director
- · Only one shareholder is required
- · Corporate Directors are permissible
- · Nominee shareholders can be used to protect the identity of the owners
- · The Isle of Man is a well-regulated highly regarded jurisdiction giving IOM Companies and air of respectability in the International Market Place.
Common Uses for IOM Companies
Most common use of the Isle of Man offshore companies:
- Holding investments, e.g. portfolios, UK commercial property and other companies shares – these activities are not taxed in IOM;
- Simplified trading within the EU due to the zero rate of tax on trading income and the ability to quote an EU accepted VAT number;
- Holding intellectual property (As the Isle of Man is a signatory to the Paris Convention on Patents and Trademarks).
Doing Business in Europe?
The Isle of Man is part of the UK for VAT purposes only. The consequence of this is that it is possible to very quickly (and relatively cheaply) obtain a UK VAT number using an Isle of Man company (in a matter of weeks rather than months).
Moreover if VAT registration is desired the Isle of Man is the only country which provides a 0% tax environment in which it can be achieved.
VAT registration is of course also possible in all EU countries and some tax saving can still be achieved through the use of, low tax EU countries, such as Malta (where the effective tax rate can be as low as 5%) or the UK (where tax transparent structures can achieve an effective rate of 0% however much greater delays should be anticipated with UK registration as opposed to Isle of Man registration).
OCI Isle of Man Company Formation Services
At OCI we believe in giving you more for your money than would the average IBC formation service. Hence included in the incorporation package for your IOM Company is the following:
- · Unlimited name availability inquiries
- · Advice from an experienced International Corporate Lawyer on how to structure your company
- · Preparation (overseen by a lawyer) of application to incorporate the company
- · Preparation (overseen by a lawyer) of the company’s memorandum of association
- · Preparation (overseen by a lawyer) of the company’s articles of association
- · Attending to filing incorporation request with the company registry
- · Attending to payment of government filing fees
- · One year’s Registered Agent service in the country of incorporation
- · One year’s Registered Office service in the country of incorporation
- · Company Secretary
- · Mailing address in the country of incorporation
- · Delivery of Incorp pack by international courier (ie DHL/Fedex/TNT etc)
- · Unlimited free legal consultations for 12 months (Speak to our In House Lawyer at any time for advice on how to manage/administer your Company etc)
Documents included in your Incorp pack:
- · Certificate of incorporation
- · 2 sealed/stamped copies of the company’s Memorandum of Association
- · 2 sealed/stamped copies of the company’s Articles of Association
- · Resolution appointing first director/s
- · Resolution appointing first shareholder/s
- · Up to 5 share certificates
- · Resolution to open a bank account
- · Resolution to rent an office
- · Resolution/s to engage a Phone, Internet & Website service provider
- · Resolution to hire a staff member/s
- · Resolution to appoint a company lawyer
- · Resolution to appoint a company accountant
- · Resolution appointing you as the company’s authorised representative in commercial negotiations
- · Resolution issuing a Power of Attorney in your favour
- · Agreement authorising you to represent the company in commercial negotiations
- · Power of attorney authorising you to sign documents on behalf of the company
- · Register of directors
- · Register of shareholders
- · Expression of wishes (ie an “Offshore” Will)
- · Lawyer authored User Guide (“How to Use Your Offshore Company”)
Price (all inclusive): GBP 2,440
(With tax effective offshore company management ie including Professional “Nominee” Director, Shareholder & Company Secretary: GBP 1,000)
From year 2 (including government fees, provision of IOM registered office/agent service, maintenance of statutory records, compliance, filing of Annual Return and any tax/license declaration): GBP 990
Every effort has been made to ensure that the details contained herein are correct and up-to-date, but this does not constitute legal or other professional advice. We do not accept any responsibility, legal or otherwise, for any error or omission.