At the present time a company incorporated in the Isle of Man, owned by non-residents and which complies with the other statutory requirements, is not liable to Isle of Man taxation. Whilst locally trading companies pay tax at 18%, a qualifying offshore company pays a flat annual tax of ?475 or ?1,000.
The Isle of Man is however required to comply with the E.U. Code of Conduct on Business Taxation and other international initiatives designed to eliminate discrimination between taxpayers. This means, essentially, that the tax treatment of local and offshore companies should be the same. The Island decided some time ago that it would meet its obligations by introducing a zero rate of taxation for all companies except those engaged in certain finance sector activities and the Government has now issued a consultation paper outlining how it is proposed that the new system will operate.
From April 2006 the distinction between offshore and locally resident companies will disappear and companies will be classified as distributing or non-distributing. A distributing company will be one of the following,
? Where the whole of the distributable profit has been charged to tax at the rate of 10% or
? Where the company has distributed a specified minimum of its distributable profit, expected to be 60% for a trading company and 100% for an investment company or
? A company owned wholly by non- residents, regardless of what percentage of profit is actually distributed.
It is this third category of qualification, which is the most important, as it means that companies, incorporated on the Isle of Man but wholly owned by non-residents, will continue to enjoy tax- free status.
Companies will have to apply for distributing status but the exact means by which they will do so has not as yet been decided. The Government has however indicated that companies which have successfully claimed such status may not be required to submit accounts with every tax return providing sufficient information is provided on the return to support the claim.
There are further rules which apply to companies which are wholly or partly owned by Isle of Man residents and these companies will be obliged to calculate the tax payable on that part of the profits applicable to local shareholders and to pay it over to the Treasury.
The new system will accord with the international obligation for the Isle of Man not to discriminate between onshore and offshore companies and enable it to escape the sanctions, which may be invoked against some of the other offshore centres.
The Chesterfield Group provides a full range of trustee, and corporate advisory, formation and management services and invites enquiries. More particulars can be found on our web-site http://www.chesterfield-management.com REF=CH5EZ
Mercedes Benz s500 rentals Salem ..You're at your office, or home, and the doorbell rings... Read More
To tax or not to tax - this question could... Read More
If you have employees, you are responsible for paying a... Read More
Choosing the right tax preparer for your business is a... Read More
If your business has employees, you must pay employment taxes.... Read More
One way to maximize your business profits is by reducing... Read More
NOTE: This is the first in a series of 5... Read More
In elementary school, kids come up with creative excuses why... Read More
Employers often ask employees to designate the amount of tax... Read More
How about a Tax Tip?As we all know Taxes are... Read More
"Deducting Meals and Entertainment"O.K. You've been working really hard on... Read More
An early distribution from an Individual Retirement Arrangement (IRA) or... Read More
Whether helping the kids with a down payment on their... Read More
Assume a buyer in Pakistan downloads software from the Internet... Read More
With the massive losses caused by Katrina, the economy of... Read More
While there are many equally valid reasons to incorporate, saving... Read More
OverviewIn the Pre-Budget Report of December 2003 the Chancellor Gordon... Read More
When buying a business, how the "purchase price" is made... Read More
Many small businesses complain when confronted with the expense of... Read More
One can never underestimate the enthusiasm that politicians have for... Read More
A Federal Tax Lien (FTL) is a legal instrument that... Read More
The Internal Revenue Service is reporting that the difference between... Read More
Millions of people file tax return extensions every year. The... Read More
April 15th looms in front of most people every year... Read More
Donating your used car to charity is a win-win situation;... Read More
Dowagiac cheap limo service ..It's a moment every person dreads. You pick up the... Read More
No one likes paying tax. Everyone understands that tax is... Read More
At the present time a company incorporated in the Isle... Read More
All tax authorities to e-commerce transactions should investigate the record... Read More
If you are a Small Business Owner or Self-Employed Person,... Read More
"Deducting Meals and Entertainment"O.K. You've been working really hard on... Read More
Strategic planning throughout the year results in a minimal tax... Read More
Estate taxes. It's not enough to simply know they exist,... Read More
Does your incorporated business pay alternative minimum tax ["AMT]? If... Read More
The electronic transaction ordinance defines the certificated copies in which... Read More
Does this scene sound familiar? It's April 7. You haven't... Read More
As an employer, you must pay employment taxes if you... Read More
Six Urban Myths ? Taxation"I am proud to be paying... Read More
As we enter mid-March, taxpayers begin to become very interested... Read More
As a small business owner or self-employed person, one of... Read More
If your like many, you don't always understand what people... Read More
With gas prices at an all time high before Hurricane... Read More
Employers often ask employees to designate the amount of tax... Read More
It's that time again, the April 15 tax deadline is... Read More
Someone once said, 'the best way to calculate your taxes... Read More
Tilting the Tax Laws in Your Favor.In order to accelerate... Read More
Many small businesses complain when confronted with the expense of... Read More
Your days as an entrepreneur and businessperson are consumed with... Read More
Small Businesses Filing Amended Federal Tax Returns to... Read More
For many business owners the answer to this quandary is... Read More
Tax |