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Residency in the Isle of Man

Immigration legislation on the Isle of Man is similar to that in the United Kingdom and applies to nearly everyone that is not a British Citizen. Irish citizens and EEA citizens can exercise Treaty rights in order to be exempt from many provisions. Individuals who are not British citizens should contact their nearest British Embassy in order to establish their immigration status and start the procedure in order to enter the Island.
The government permits non-residents to purchase and own real estate on the Island.
An Isle of Man resident is taxed on worldwide income whereas a non-resident is taxed on Isle of Man source income only, unless that source income is excluded from income tax when paid to a non-resident by virtue of statute or regulation. There is no general definition of residence for tax purposes in the Isle of Man. New residents are required to complete a form registering themselves for Income Tax purposes. An individual will be considered resident if on the Island for more than six months in any tax year. Individuals who visit the Island over a period of four or more consecutive years and exceed an average of ninety days in each tax year will also be considered resident. It is possible for an individual to meet this criteria in more than one country and so be tax resident in more than on country, double taxation relief is available in these circumstances.

The recent expansion of the finance sector has created more jobs than can be filled by residents and therefore the official policy is to ensure compatibility with the Isle of Man community and fill the need for professional and skilled people, some professions such as doctors, dentists and ministers do not require a work permit. Around 10,000 work permits are issued each year to allow employers to secure the suitably skilled workers they require. This is in part responsible for a continued growth of over six percent in the economy compared to a one percent growth in population. The Isle of Man introduced a point system in 2010 whereby prospective workers from outside the European Economic Area or Switzerland must achieve sufficient points in order to obtain the necessary visa. Points are awarded for evidence of a lack of suitable local skilled workers, proof that they have sufficient funds available to them and proficiency in the English language.

There is a Residency Act that was passed on the 20th March 2001, but this will not be activated unless the government perceive that there is a seriously deteriorating economic or social situation requiring intervention. The purpose of the Act is to impose controls on the growth of the population of the Island by means of a residency register.

A company formed in the Isle of Man is resident for tax purposes. Also if a company is incorporated outside the Isle of Man it is regarded as resident if the management and control is on the Island. This rule comes from UK case law. Non resident companies that have a branch in the Isle of Man are taxed to the extent of the business conducted on the Island.

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