Read Tax Partner, Robert Rotherham's latest article about the 2021 Isle of Man Budget.
The Treasury Minister, Alf Cannan MHK, delivered the 2021 Isle of Man Budget speech in Tynwald today and, from a tax perspective, there was little on the agenda.
The Treasury Minister confirmed that there are no changes proposed to the Island’s tax system for the 2021/22 tax year and therefore there would be no movement in the tax and national insurance rates, bands and thresholds that are currently in force, which, for personal income tax, are set out below as a reminder:
– Personal allowance (single person) - £14,250
– Personal allowance (married couples) - £28,500
– Lower 10% tax band for a single person - £6,500
– Lower 10% tax band for a married couple - £13,000
– Higher rate of tax - 20%
It was also confirmed that the National Insurance Holiday Scheme will continue for another year which is welcome news for new residents and students looking to return to work on the Island. In addition, as a result of the COVID-19 pandemic, the scheme has been amended to ensure that individuals who claimed Manx Earnings Replacement Allowance (MERA) or received a reduced salary from their employer who claimed Salary Support are not adversely affected. The National Insurance Holiday Scheme commenced on 6 April 2019 and allows for a one-off refund of Class 1 National Insurance Contributions deducted in the first year (subject to certain qualifying conditions being satisfied), up to a maximum of £4,000. Given the increased level of interest in individuals wishing to relocate to the Isle of Man in the current climate, this would appear to be a positive step.
If you have any questions in relation to the 2021 Isle of Man Budget or any other tax matter, please don't hesitate to contact us.
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