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IoM 2010/11 Budget Increases Individual Taxation

Thursday, February 18, 2010

The Isle of Man’s Treasury Minister, Allan Bell, presented his ninth budget in the island’s parliament, the Tynwald, on February 16. The budget features lower public spending, increased individual taxation and the use of reserves to offset the fall in tax revenues as a result of the change to the VAT sharing arrangement with the UK.

Bell explained that the budget was the first installment of a five-year strategy to rebalance government finances following the UK government’s announcement that it would be reducing the amount of VAT apportioned to the island under the two countries’ VAT sharing agreement.

The salient features of the 2010/2011 budget include:

  • A GBP37.1m, or 6.5%, reduction in net revenue spending overall (but with no decrease in net spending on health and social care);
  • A 2% increase in the higher personal income tax rate to 20%, from 18%, raising an additional GBP9.4m;
  • A 1% increase in employee National Insurance Contributions (approved by Tynwald in November last year), raising GBP7m; and
  • A GBP15m transfer from Reserves.

Bell also announced an 18% increase in Personal Allowance Credit for the least well off, a 1% increase in income tax personal allowance, GBP96m capital spending, a freeze on salary budgets and the loss of nearly 100 staff posts by non-replacement.

“This is a Budget that paves the way for change while maintaining support for the least well-off in our society. There are further and greater challenges ahead, but we now have a clear plan to manage the transition to a new era of government fit for the future,” Bell explained.

“The Isle of Man is not alone in facing fiscal difficulties, but we are in a relatively strong position. Our economy is still healthy and we are a resilient and resourceful small nation with a track record of working together to make the most of changing circumstances.”

Other noteworthy measures in the Budget include:

  • The non-resident personal allowance is to be withdrawn.
  • An increase to the Personal Allowance Credit from GBP550 to GBP650 per person or GBP1,300 per couple (18%).
  • The tax cap will be increased by 15% to GBP115,000 per person per annum.
  • The cap on Mortgage and Loan Interest relief will be reduced by GBP5,000 to GBP10,000 per person per annum, providing relief on up to GBP200,000 of mortgage or loan per person at a 5% rate of interest.
  • Corporate tax rates are unchanged.

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The Report

Offshore Trusts Guide: Introduction

The History of Offshore Trusts
Development of Professional Competence in the Jurisdictions
What Future for the Trust?
The New Age of Transparency
The Swiss Association of Trust Companies
The Society of Trusts and Estates Practitioners

Offshore Trusts Guide: Jurisdictions

Bahamas

Bahamas: Legal Framework and Formation Rules and Fees
Bahamas: 2006 Private Trust Companies Legislation

Barbados

Barbados: Legal Framework and Formation Rules and Fees
Barbados: Supervisory and Licensing Regime and Fees

Bermuda

Bermuda: Legal Framework and Formation Rules and Fees
Bermuda: Supervisory and Licensing Regime and Fees

British Virgin Islands

British Virgin Islands: Legal Framework and Formation Rules and Fees
British Virgin Islands: Special Trusts Act 2003
British Virgin Islands: The Trustee Act 2003
British Virgin Islands: :Supervisory and Licensing Regime and Fees
British Virgin Islands: New Laws on Private Trust Companies
British Virgin Islands: New Private Trust Company Regulations

Cayman Islands

Cayman Islands: Legal Framework and Formation Rules and Fees
Cayman Islands: Supervisory and Licensing Regime and Fees

Cook Islands

Cook Islands: Legal Framework and Formation Rules and Fees
Cook Islands: Supervisory and Licensing Regime and Fees

Cyprus

Cyprus: Legal Framework and Formation Rules and Fees
Cyprus: Supervision, Licensing and Tax

Gibraltar

Gibraltar: Legal Framework and Formation Rules and Fees
Gibraltar: Legislation, Regulation and Supervision

Guernsey

Guernsey: Legal Framework and Formation Rules and Fees
Guernsey: Trusts Law 2007

Isle of Man

Isle of Man: Legal Framework and Formation Rules and Fees
Isle of Man: Supervisory and Licensing Regime
Isle of Man: Uses Clients and Tax Treatment

Jersey

Jersey: Legal Framework and Formation Rules and Fees
Jersey: Supervisory and Licensing Regime
Jersey: Trusts Amendment Act 2006
Jersey: Foundations

Liechtenstein

Liechtenstein: Legal Framework and Formation Rules and Fees
Liechtenstein: Regulation Supervision and Transparency
Liechtenstein: Characteristics of Liechtenstein Trusts
Liechtenstein: Foundations

Madeira

Madeira: Legal Framework and Formation Rules and Fees

Malta

Malta: Legal Framework and Formation Rules and Fees
Malta: The Trust and Trustees Act 2004

Mauritius

Mauritius: Legal Framework and Formation Rules and Fees
Mauritius: Characteristics of the 2001 Trusts Act
Mauritius: Additional Provisions of the 2001 Trusts Act
Mauritius: Tax Treatment

Monaco

Monaco: Legal Framework and Formation Rules and Fees

Nevis

Nevis: Legal Framework and Formation Rules and Fees

Panama

Panama: Legal Framework and Formation Rules and Fees
Panama: Requirements for Acting as Trust Company in Panama

Seychelles

Seychelles: Legal Framework and Formation Rules and Fees

Turks & Caicos

Turks & Caicos: Legal Framework and Formation Rules and Fees
Turks & Caicos: The Voidable Dispositions Ordinance

Vanuatu

Vanuatu Legal Framework and Formation Rules and Fees




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