About the Isle of Man
The Isle of Man is an autonomous British Crown dependency, not part of the United Kingdom or the European Union. Situated in the Irish Sea between Great Britain and Ireland, it is an attractive place to start a business in various sectors.
The Isle of Man offers a favorable environment for internet companies, including software development, e-commerce, and online platforms, due to its advantageous tax conditions and stable legal system. Trading and financial companies can also benefit from the Isle of Man, particularly in terms of financial regulation and investment activities.
The gambling industry thrives here due to flexible rules and licensing for online casinos, sports betting, and other gaming activities. Yacht and ship registration is also a lucrative business on the island, thanks to its coastal location and convenient registration process. This fosters opportunities for the shipbuilding, shipping, and manufacturing industries.
Advantages of Opening a Company in the Isle of Man:
- The Isle of Man is a classic offshore zone, meaning an offshore company can be tax-free with the right approach.
- It is a respected international financial center with a long history and excellent reputation.
- It has a developed and stable banking system, ensuring convenient and reliable financial operations.
- The Isle of Man boasts a highly developed iGaming ecosystem, making it one of the leading global centers for companies in this industry.
- One of the main advantages is the practical absence of corporate tax, allowing companies to significantly reduce their tax burden.
- The Isle of Man does not impose capital gains tax, making it attractive for investment and business growth.
- Companies on the Isle of Man can pay dividends to their shareholders without withholding tax.
- The company formation process can be conducted remotely and by non-residents, simplifying and speeding up the process for entrepreneurs worldwide.
Legislation
The fundamental principles of Isle of Man law are based on English law, including common law principles. Key legislative acts regulating business registration in the Isle of Man include:
- Isle of Man Companies Act (1931)
- Isle of Man Companies Act (2006)
- Limited Liability Companies Act (1996)
- Isle of Man Financial Services Act (2008)
- Isle of Man Gambling Act (2001)
Company registration under the 1931 Act allows the founder/director to manage the firm independently without an official agent, while incorporation under the 2006 Act requires a local registered agent and offers more flexible legislative requirements.
Company Forms
Under the 2006 Act, it is possible to establish:
- A company limited by shares
- A company limited by guarantee
- A “hybrid” company limited by guarantee and having a share capital
- A company with unlimited liability
The most popular form for non-residents on the Isle of Man is the LLC, regulated by the 1996 Act. This form allows 100% foreign ownership and limits the liability of participants to their contributions.
In addition to traditional company forms, other structures such as trusts, partnerships, foundations, and others are available on the Isle of Man.
Requirements for Company Forms
LLC on the Isle of Man:
- Minimum capital: No minimum requirement for authorized capital.
- Founders: Minimum of one founder, which can be individuals or legal entities, residents or non-residents.
- Charter: Required, containing information about the company’s name, address, objectives, operating rules, etc.
- Directors: At least two directors (can be founders), who can be individuals or legal entities, though appointing at least one local director is recommended for tax residency purposes.
- Secretary: No requirement.
- Public information: All main data about the company and its owners. The register of beneficiaries is public.
- Reporting: No obligation to submit annual financial statements, but preparation and maintenance of annual profit and loss statements, balance sheets, and directors’ reports at the registered office are mandatory.
- Office and agent: A legal address and registered agent on the Isle of Man are required. The address will be used for correspondence.
Taxation
Corporate tax (on income) for Isle of Man resident companies can be 0%, 10%, or 20% (maximum) depending on the source of income:
- 0% – standard rate;
- 10% – banking, financial activities, retail if annual income exceeds GBP 500,000;
- 20% – profit from real estate, and from April 2024, activities related to oil extraction.
There is no capital gains tax. The standard dividend tax rate is 0% for both the paying company and the receiving individual. Non-resident personal income tax is 20% if the income is earned on the Isle of Man. VAT is 20%, following the same system used in the UK.
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Double Taxation Avoidance Agreements
The Isle of Man does not have a double taxation avoidance agreement with Ukraine. However, such agreements are signed with the UK, Ireland, Canada, the USA, France, Poland, Germany, and several other countries.
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Features
The Isle of Man has a long history in gambling and a developed industry in this field. Many gaming companies already operate here, creating a favorable and competitive environment for new players. The island’s gambling legislation is transparent and predictable, providing legal protection and stability for businesses, and Isle of Man gaming licenses are recognized and respected worldwide.
Licenses issued in the Isle of Man cover all aspects of online gambling and allow the use of various digital assets, including cryptocurrencies, for five years. Additionally, the Isle of Man offers very low tax rates on gambling activities, ranging from 0.1% to 1.5% of gross gaming revenue, demonstrating its democratic tax policy.
If you are interested in creating an offshore company on the Isle of Man and seek professional assistance and advice, contact Campio Group. We specialize in providing services for company creation and registration, as well as comprehensive support in solving financial and legal issues. To buy an offshore company on the Isle of Man, check with our specialists for the availability of ready-made companies.
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Our experienced experts will assist you with every step of the company creation process and provide the necessary information and recommendations. With Campio Group, your business on the Isle of Man will be launched on the right path to success.
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