On 20 February 2018 Treasury Minister Alf Cannan delivered his second Manx Budget.
On 20 February 2018 Treasury Minister Alf Cannan delivered his second Manx Budget. The key Isle of Man Income Tax measures introduced in the Budget were as follows:
- Lower Earnings Limited (LEL) increased by £3 to £116
- Class 2 rate for volunteer development workers increased by 15p to £5.80
- Class 3 rate for voluntary contributions increased by 40p to £14.65
- £1,000 limit on total cost of bicycle and equipment removed
- maximum tax deduction of £1,000 permitted for any employee in a period of 3 consecutive years
- exemption extended to include “electric bikes”
- relief can be used in conjunction with general benefits-in-kind exemption of £600
- 40% tax-free lump sum
- unrestricted access to remainder of fund (taxed as income on receipt)
- transfer from existing approved schemes permitted, subject to 10% transfer charge
- investment income of fund exempt from Manx income tax
- contributions limited to £50,000 per annum
- no tax charge on death (but funds must be paid out within 2 years)
- where consideration is left outstanding on loan account as a result of a post 4 April 2011 sale, loan repayments post 19 February 2018 will be taxed as dividend income to extent of distributable reserves of company
- where sale takes place post 19 February 2018 consideration will be taxable as dividend income to the extent of the distributable reserves of company.
Please contact any of the below or your usual contact if you would like information regarding any of the above.