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Isle of Man |
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Isle of Man Key Corporate Features
* Only companies listed on a recognised exchange may change domicile. ** Only with revenue service, not on public record. The Isle of Man, situated in the centre of the British Isles,
is a self-governing dependent territory of the Crown which is not
part of the United Kingdom. Tynwald, the Island's 1,000 year old
Parliament, makes its own laws and oversees all internal administration,
fiscal and social policies. External issues, such as foreign representation
and defence, are administered on the Island's behalf by the UK Government
and the Island makes an annual payment for these services. Tynwald (Parliament), legislates on all domestic matters including taxation. Tynwald consists of two houses; the Legislative Council, which consists of eight members, elected by the lower house, The House of Keys, and the Bishop and Attorney General, neither of whom has voting rights. The House of Keys has twenty-four members who are elected and serve a five-year term. HM Queen Elizabeth II holds the title Lord of Man, and is ultimately responsible for the government of the Island, and all legislation passed by Tynwald has to have Royal Assent before being enacted. There are regular daily air and ferry services to the UK and Ireland. The Isle of Man, confronted with a decline in its two principal sources of income, agriculture and tourism, now places greater reliance upon industrial investment and its financial centre activities. The official and spoken language is English. The type of law is Common Law, based on English Common Law. Principal Corporate Legislation Three types of company are generally used for trade and investment: the Limited Resident, the Limited Exempt Company and the Limited Liability Company. Both the Limited Resident and the Limited Exempt Company, by law, must have at least one Isle of Man resident director and must appoint an Isle of Man resident company secretary who must be a natural person and hold a professional qualification. The Limited Exempt Company is normally used for personal or corporate investment holding and for trading activities with European Union countries. The Limited Liability Company legislation is based on US LLC legislation. Manx LLC’s must have two members and appoint a local registered agent. Procedure to incorporate a Limited Resident or Limited Exempt Company: Submission of Memorandum and Articles of Association, together with "Form I" nominating the first directors and secretary, and advise of the situation of the Registered Office and the form giving name approval. Immediately after incorporation Limited Exempt Companies must select Exempt status. The procedure to incorporate a LLC: Filing of Articles of Organisation with the Registry. Limited Exempt and LLC companies are not permitted to: to trade within the Isle of Man; An Isle of Man company has all the powers of a natural person. The language of legislation and corporate documents is English. Companies must maintain a registered office in the Isle of Man. Shelf Companies are available. The time scale to incorporate ranges from one – four days, subject to name approval. The following name restrictions apply: A name that is similar to or identical to an existing company. A name that is known to exist elsewhere. A name that implies illegal activities. A name that implies royal or government patronage. Many names require justification or high capitalisation to allow use. Words such as "International", "European" or other words indicating an international presence will only be approved if the company is incorporated with an authorised capital of £100.000, which must be fully paid up. Use of the words "Trust", "Trustees" or "Fiduciary" will only be approved if the company is incorporated with an authorised capital of £250.000, which must be fully paid up. Use of the word "Holdings" will only be approved if the company can provide documentary evidence that it holds 51% or more of an underlying company. Use of the word "Group" will only be approved if the company can provide documentary evidence that the company owns a group of companies. Names can be expressed in any language using the Latin alphabet, if the Registrar of Companies is in receipt of an English translation and the name is not considered undesirable. The following names or their derivatives require consent or a licence: bank, building society, savings, loans, insurance, assurance, reinsurance, co-operative, council, Chamber of Commerce, trust, municipal and finance or their foreign-language equivalents. Limited Resident and Limited Exempt companies must utilise Limited or Ltd as a suffix whilst LLC’s must utilise Limited Liability Company or LLC or L. L. C. There is no disclosure of beneficial ownership to government authorities. Limited Resident and Limited Exempt companies have a normal authorised share capital of £2.000 or its currency equivalent, this being the maximum for the minimum capital duty (£14 per £ 1.000 of capital) payable upon incorporation. The minimum issued capital is one share of par value. Limited Resident and Limited Exempt companies may have registered shares, preference shares, redeemable shares and shares with or without voting rights. Bearer shares are prohibited. Limited Resident companies pay income tax at 18%. Limited Exempt pay no income tax, but pay a fixed annual fee to the Government. Limited Exempt companies are not tax resident in the Isle of Man and may not undertake business in the Isle of Man. LLC's are fiscally transparent and taxed as a partnership, thus an International LLC with no resident members or business in the Isle of Man is not taxed in the Isle of Man. Such LLC's are classed as "International LLC's" and pay a fixed annual fee to the Government. Isle of Man companies may be registered for VAT purposes and the VAT prefix will be "GB". Foreign companies may be registered on the "F" register, apply for tax exemption in the Isle of Man and then apply for VAT registration. Apart from a limited treaty with the United Kingdom, the Isle of Man is not party to any double tax treaties. Limited Exempt pay a licence fee of £430 on application and thereafter they pay £430 per year, which is due on 6th April. LLC’s pay an annual licence fee of £1.200. Whilst there is no requirement to file audited financial statements with the authorities, it is important to note that a company is required to keep financial records, which reflect the financial position of a company. If accounting records are kept at a place outside the Isle of Man they must be sent to the company's registered office in the Isle of Man such as to disclose with reasonable accuracy the financial position of the business in question at intervals not exceeding 6 months. Failure to maintain accounts or make them available for inspection at a company's registered office is an offence punishable by imprisonment or a fine. The Assessor of Income Tax reserves the right to call in the financial records for inspection. Limited Resident and Limited Exempt companies must have a minimum number of two directors. Limited Exempt companies are required to appoint at least one resident director. Bodies corporate may not be appointed as directors. LLC’s don’t have directors, there must be at least one manager, either a natural person or a body corporate of any nationality. Limited Resident and Limited Exempt companies require a Company Secretary. The Company Secretary must be a natural person, resident in the Isle of Man and must hold a professional qualification. Limited Resident and Limited Exempt companies may have one shareholder. LLC’s don’t have shareholders, but a minimum number of two members. Other Isle of Man entities used for international tax planning include: Guarantee Companies Further information on these alternative structures is available on request. Contact: info@personaloffice-bv.com
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