The Isle of Man Treaty Income Tax Division published a practice note on 2 January to address the determination of the tax residence of companies and other corporate taxpayers.
The practice note covers how the tax residence of a company is established. The Isle of Man applies a combination of both the place of incorporation and the place of central management and control of the company in order to determine the tax residency of a company.
The practice note also covers dual residence, transfer of domicile, application for non-residence for companies incorporated in the Isle of Man and for tax residence for those not incorporated in the Isle of Man, as well as certificates of residence and reporting obligations.
Since 2006, the standard rate of corporate income tax in the Isle of Man is 0%, although a 10% rate of tax applies to income received by a company from banking business and to retail business in the Isle of Man that has taxable income of more than £500,000. A 20% rate of tax applies a 10% rate of tax applies to income received by a company from land and property in the Isle of Man.