OCRA Worldwide's original and largest business centre offers a comprehensive range of business solutions to corporations and entrepreneurs wishing to establish a physical presence on the Isle of Man, one of Europe's premier offshore financial centres, offering Zero corporate tax and capped rates of personal income tax.
The Island's Government has positively encouraged economic growth in recent years by creating a sympathetic tax regime and suitable legislative framework for expansion and by offering financial incentives where necessary, particularly for the manufacturing industry and tourism. In addition, the establishment of a Freeport on the Island has assisted the manufacturing sector to become one of the major income earners.
Whilst other offshore centres have become overcrowded and expensive, the Isle of Man is in the fortunate position of being able to provide affordable high-quality commercial and residential accommodation in a spacious and scenic environment. It has the capacity for sustaining growth for many years while continuing to retain these virtues.
Doing Business in Isle of Man Brochure (PDF Format)
Despite the current economic climate the Isle of Man Government finances remain strong with the government successfully delivering its 5 year rebalancing plan on track. The current year has seen a revenue surplus of £10 million against a forecast of £100,000. The economy remains resilient with a growth rate of between 4-5%, unemployment remains at approximately 2% and the RPI annual inflation rate has seen a further fall in October 2011 to 5.2%
The recent OECD progress report on Tax Transparency 2011 to the G20 placed the Isle of Man as one of only eight reviewed jurisdictions to have all elements of effective information exchange in place. The report is based upon a rigorous assessment of the Isle of Man's legal and regulatory framework and places the Isle of Man alongside Australia, France, India, Ireland, Italy, Japan and Norway.
However a change in how the rating agency Standard and Poor assesses the impact of external factors and monetary flexibility in small countries has seen the Islands AAA rating go down one notch to AA+. The move to the new method of rating by Standard and Poor has seen a number of other countries ratings revised.
The zero corporate tax rate of 2006 remains in place.
The rate of corporate income tax on trading and investment income is 0% and that the rate of corporate income tax on banking business income and land & property income is 10%. The rate of withholding tax on taxable distributions to non-residents is the same as the rate of tax paid by the company.
In the event that Manx companies are owned by Manx trusts, the residence of a trust for tax purposes (notwithstanding that it may have Isle of Man-based trustees) generally will be determined by the residence for tax purposes of the beneficiaries of the trust.
The result of the foregoing is that clients who are not resident in the Isle of Man for tax purposes can utilise a tax-resident Isle of Man company for trading purposes (most effectively within Europe as an Isle of Man company can be registered for V.A.T.) with no Isle of Man tax on the profits thereof or on distributions therefrom.
The abolition of corporate tax added substantially to the attractions of asset-holding companies on the island, which already benefit from the absence of capital gains tax, stamp duty or inheritance tax.
The introduction of the Incorporated Cells Act 2010 and the Insurance (ICC) Regulations 2011 came into effect on the 23rd June. The use of ICCs was restricted to Insurance business however the provision within the Act now allows for this to be extended to include other types of business.
An ICC creates incorporated cells with separate legal identities within their own right. They may hold assets, sue and be sued in their own name. It is hoped that the introduction of the ICC will reinforce the Isle of Man's reputation as a competitive jurisdiction for captive insurance business.
The introduction of an Isle of Man Foundation (to appeal to clients and practitioners of civil law jurisdictions) is due in 2012 with the benefit of 0% income tax on profits.
The Foundation will be a separate legal entity in its own right and will have the ability to manage its own assets in its own name and arrange for its own funding. Similar to a company it will have limited liability and can be run in perpetuity. Unlike a Trust arrangement the Foundation:
Since 2006 there has been a capping of individual income tax liability at £100,000 p.a. on worldwide income with a view to encouraging entrepreneurs to relocate to the Isle of Man, thereby encouraging growth of the Manx economy.
The OCRA Worldwide team based in Ramsey in the North of the Island has particular expertise in the utilisation of Manx business entities for international trade and investment and for real property and intellectual property holding.