Limited Liability Company
The Isle of Man is a high-reputable international finance and international business center due to its political stability, business friendly policies and an attractive fiscal and regulatory environment.
Limited liability companies are incorporated under the Limited Liability Company (LLC) Act 1996, which was adopted from the Wyoming (US) LLC legislation.
An Isle of Man LLC is a hybrid of both partnership and corporate structures, protecting LLC members from the debts incurred by the entity and separating the rights of its members and that of the LLC.
An LLC requires minimal corporate formation requirements and a fast registration procedure. There are no company structure requirements for its management, nor are there provisions for company meetings, directors, secretary, or capital. Its operating agreement may be arranged by its members according to their needs.
LLCs are fiscal transparent entities, all profit received by the LLC is considered to be transferred to its members and taxed at the personal level. Members pay personal income taxes in their country of residence on LLC profits proportionally to their share of participation in the LLC company, whether distributed or not.
It is important to note that certain countries do not recognize the pass-through status of an LLC, if the LLC is deemed to be tax resident in one of such countries, it may be subject to corporate income tax.
An LLC may a minimum of two member up to an unlimited number of members and is therefore useful as a tax transparent investment vehicle.
LLC’s tax transparency allows residents of certain jurisdiction to not be penalized under controlled foreign company rules.
The Isle of Man is part of customs territory of the EU under Protocol 3. Therefore, Manx incorporated entities benefits from free trade with the EU and EU VAT registration.
However, the recent BREXIT has created uncertainties on Isle of Man’s future relationship with the EU and companies holding EU assets and trading with the EU.
The country is also a signatory to the Paris Convention on Patents and Trademarks, making the Isle of Man limited company an interesting vehicle to hold intellectual property.
The Isle of Man has started to undertake the first OECD automatic exchange of information (AEoI) through Common Reporting Standard (CRS) in 2017 and has signed over 50 tax information exchange treaties (TIEa) and 11 double taxation agreements (DTA).
All in all, an Isle of Man LLC is an excellent entity for movable and immovable assets holding, tax transparent investment vehicles, and in combination with a trust for asset protection purposes and estate planning.
Country code – IM
Legal Basis – Common law
Legal framework – Limited Liability Companies Act 1996
Company form – Limited Liability Company (LLC)
Liability - The liability of members is limited to the extent of their contribution to the capital.
Business restrictions – Limited Liability companies are allowed to do business and own assets within Isle of Man.
Capital – There is no minimum capital required, and it may be in a nonpaid up basis.
Members – Limited liability companies may be formed by at least 2 members, who may be natural or legal persons, resident or non-resident, without limitations. Identity of the LLC registered members may be publicly disclosed. Membership is not transferable or assignable.
The identity of the ultimate beneficial ownership must be disclosed on a confidential basis to the Companies Registry.
Manager – LLC members may appoint a manager, but it is not mandatory.
Registered Address – Companies must have a registered physical office address located in Isle of Man and must have a registered agent, who holds the appropriate fiduciary's license granted by the Financial Services Committee.
General Meeting – There is no statutory requirement for any formal meetings of members.
Electronic Signature – Permitted.
Re-domiciliation – Inward and outward re-domiciliation is allowed.
Compliance – Accounting records must be kept and shall be sufficient to show and explain the company’s transactions. There is no requirement to prepare or file financial statements.
An annual return must be filed to the Companies Registry, setting out the details of the LLC’s capital, members and any manager. Any changes that are made to the LLC during the year must be notified to the Companies Registry. LLCs must pay the annual return filing fee of, currently, £95.
LLCs are fiscally transparent; the profits of the company are treated as the income of the members for the purposes of Income Tax.
If company’s business is considered a continuing activity that involves getting paid for providing goods or services in Isle of Man, then it may be required to register for VAT, if amount of taxable supplies in the preceding 12 months is over £81,000. Continuing activity is defined by the Isle of Man Customs and Excise.
- Members not disclosed
- Managers not disclosed
- Corporate members permitted
- Corporate manager permitted
- Local manager required
- Registered office or agent required
- Annual meeting required
- Redomiciliation permitted
- Electronic signature
- Annual return
- Audited accounts
- Audited accounts exemption
- Exchange controls
- Common law Legal basis
- 2 Minimum members
- USD 1 Minimum registered capital
- - Minimum paid up capital
- USDAny Capital currency
- 100% Foreign-ownership allowed
- 2017 AEOI
Corporate Income Tax – An Isle of Man LLC is a tax transparent entity, which means that any profits are passed through to the members to be reported as personal income. If LLC owners are non-Isle of Man residents, an LLC is free from taxes originating outside of Isle of Man.
Personal income tax – An individual is tax resident in Isle of Man if is physically present in the island for at least 183 days or more in a tax year, or an average of 91 days of more over 4 consecutive years.
Residents are taxed on worldwide income, while non-residents pay tax on their income derived from Isle of Man. Income tax is levied at 10% on annual income up to GBP 8,500 and 20% on the excess. Capital gains are not subject to taxation. Investment income is taxed as ordinarily income.
For non-residents, income sourced from the island is taxed at a flat 20% rate. Non-residents don’t pay tax on dividends, bank interest and building society interest are tax-exempt.
Other taxes – For V.A.T. and Customs duties purposes the Isle of Man and UK forms a single territory. V.A.T. standard rate is 20%.
There are no additional property taxes more than the 20% income tax payable from rental or development of land and property.
In Isle of Man there are no transfer, stamp, inheritance and wealth taxes.
- Tax transparent entity
- Offshore Income Tax Exemption
- Offshore capital gains tax exemption
- Offshore dividends tax exemption
- CFC Rules
- Thin Capitalisation Rules
- Patent Box
- Tax Incentives & Credits
- Property Tax
- Wealth tax
- Estate inheritance tax
- Transfer tax
- Capital duties
- 0% Offshore Income Tax Rate
- 0% Corporate Tax Rate
- 0% Capital Gains Tax Rate
- 0% Dividends Received
- 0% Dividends Withholding Tax Rate
- 0% Interests Withholding Tax Rate
- 0% Royalties Withholding Tax Rate
- 1 Losses carryback (years)
- Indefinitely Losses carryforward (years)
- 11.00% Social Security Employee
- 12.00% Social Security Employer
- 20% Personal Income Tax Rate
- 20% VAT Rate
- 0 Tax Treaties
The Isle of Man is a dependency of the British Crown formed by a main island and some islets located in the sea of Ireland, between Ireland and Great Britain. The sovereign is the British monarch, as lord of Man, who is represented by the governor-general. Its international representation and defense are the responsibility of the Government of the United Kingdom.
Like all other dependencies, it is not part of the United Kingdom, neither the European Union nor the European Economic Area. Although it does belong to the customs union of the European Union, thus benefiting from the free movement of industrial and agricultural goods.
As a member of the Common Travel Area, the free movement of citizens of the European Economic Area is also permitted.
The island is 572 sq. km. in extent and low elevation above sea level, with 621 meters of maximum altitude on Snaefell mountain. Around the main island, there are a few small islands such as Calf of Man, St Patrick and St Michael.
The Isle of Man has about 80,000 inhabitants, of whom 26,000 reside in the island's capital, Douglas.
The English language is spoken by almost the entire population of the island and is also the official language. Manx Gaelic is the historical language and was traditionally spoken, but today there are few who speak fluently or in a daily basis.
The Isle of Man Pound is the official currency, which is not an independent monetary unit, but is a special pound sterling (GBP) issued for the island.
The Isle of Man has a completely independent government, parliament elected by universal suffrage (Tynwald) and judicial system. The executive power of the island is in charge of the General Minister and his or her Council of Ministers. The General Minister is nominated by Tynwald after each general election.
Financial services are the main economic sector. Banking, insurance, financial and offshore business services alone constitute more than a third of the island's GDP. Recently, it has been opened an office of the International Stock Exchange to boost the financial industry of the island.
Manufacturing, tourism and more recently gambling are other key sectors of its economy. Agriculture and fisheries, traditionally the major sectors, are currently relatively small in the Manx economy.
Isle Of Man Company Limited by Shares (Ltd.) – US$4,600.00 (All included)
We pride ourselves in providing the best possible professional service which includes our honest hassle free “No Hidden Fee” policy. Your incorporation package includes:
- Government incorporation and filling fee
- Bound set of Constitutional Documents
- Certified Copies of Constitutional Documents for bank account opening
- Registered Agent & Registered Office Fee
- Courier fees
Time to form: 2 weeks.
All our incorporation services include a yearly consulting session, a dedicated account manager and access to our global network of trusted business services, including introductions to accountants, financial, tax and legal advisors at no cost.
Bank Account Options
- Isle of Man Bank Account (Remotely) – US$700.00
- Mauritius Bank Account (Remotely) – US$500.00
- Labuan (Malaysia) Bank Account (Remotely) – US$500.00
- Bahamas Bank Account (Remotely) – US$500.00
- Curaçao Bank Account (Remotely) – US$500.00
- Offshore Bank Account* (Remotely) – US$300.00
- Singapore Bank Account (In-person) – US$900.00
- Hong Kong Bank Account (In-person) – US$1,200.00
- Switzerland Bank Account (Remotely) – US$1,200.00
- Cayman Islands Bank Account (Remotely) – US$900.00
- Crypto-Friendly Bank Account (Remotely) – US$3,000.00
We include introductions to payment processors or merchant accounts with all of our incorporation services. Whether you just need standard credit card processing or specialized services for high risk processing, we are happy to help you with introductions that can empower your business.
*Offshore Bank Accounts: Belize, Puerto Rico, Nevis, Antigua, Saint Lucia. Other bank account options may be available depending on business profile and turnover.
Annual Fees (2nd year) – US$3,900.00
- Government Fees
- Registered Agent & Registered Office fees
Click here to incorporate your Isle of Man LLC.