There are various beneficial schemes and tax incentives that may be available to you should you decide to relocate to the Isle of Man.
Some of these have been summarised below, but should you require further information about any of them or have any queries as to how they may apply to your personal circumstances, please contact a member of our tax team or email firstname.lastname@example.org.
The Isle of Man currently operates a National Insurance Holiday Scheme for certain new residents and students who return to work on the Island subject to certain qualifying conditions. The scheme commenced on 6 April 2019 and allows for a one-off refund of Class 1 National Insurance Contributions deducted in the first year, up to a maximum of £4,000.
Full details are available in the Isle of Man Government’s Practice Note 207-19 and on the relevant application form at R247 – Application for the National Insurance Holiday Scheme.
The Employee Relocation Incentive provides a 20% grant of up to £10,000 towards the cost of relocating an employee to the Isle of Man.
The Scheme is designed to encourage job growth and the import of skills from outside of the Isle of Man in certain sectors, where businesses have been unable to recruit locally. Eligible sectors include financial and professional services, specialist construction, manufacturing, digital and tourism and hospitality.
This key employee incentive is aimed at individuals who are or will be new residents and who are effectively essential to the implementation and the operation of new business in the Isle of Man, eg an entrepreneur setting up a new business himself or a key new employee that an existing business requires to move to the Island in order to expand or develop into a new area or market.
The impact of this is that for the first 3 years from when the individual becomes Isle of Man resident, he or she will only have to pay Isle of Man tax on his or her remuneration from employment, benefits in kind and any rents received from Isle of Man property. This means that any other sources of Isle of Man income or income arising from outside the Island will not be chargeable to Isle of Man income tax.
Please see the Isle of Man Government’s Practice note 210-20 for more detail in this regard.
It may be possible to elect for your tax liability to be capped to a fixed amount and which can therefore provide certainty of tax to be paid for five years (or an optional longer period of 10 years) irrespective of your taxable income. For elections made prior to 6 April 2021 the tax cap is £200,000 per annum (or £400,000 for those jointly assessed). If an election is not made, all income is taxed at the standard rates up to a maximum of 20% for the tax year 2020/21.