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Set up an Offshore Company in Isle of Man

Set up an Offshore Company in Isle of Man

There are many reasons why investors should choose to set up an offshore company in the Isle of Man, most importantly the fact that there are no taxes on profits.

Offshore company formation in the Isle of Man can be an excellent solution for trading or for maintaining various investment portfolios.

Steps for setting up an offshore company in the Isle of Man

The Isle of Man company formation process is a simple one and it can be expedited with the help of our company formation agents. We can help you gather and draw up the needed company documents and submit them for registration.

The steps for opening an offshore company are generally the following ones:

  1. Choose the business type: the LLC, the foundation, the trust – used according to the offshore or holding investment needed.
  2. Appoint the registered agent and determine the registered office: these two elements are required when setting up a company in the Isle of Man
  3. Draw up the company documents: the Memorandum and Articles of Association.
  4. Document submission: once prepared, the company documents and information about the directors and shareholders are submitted for company registration with the Companies Registry.
  5. Open a bank account: once registered, the company can open a bank account; our agents can help investors during this step without them needing to travel to the Island. 

Conditions for Isle of Man offshore company set up

The following list describes the several most important conditions for company registration in the Isle of Man:

  • Registered office: according to the local company registration requirements, the company must maintain a registered office on the Island.
  • Registered agent: also according to the general company formation rules, it is required to appoint a licensed registered agent (the license is to be issued by the Island of Man Financial Supervision Commission).
  • Management: one director is needed to open a company, however, there are no restrictions on special requirements for residency. One shareholder is also needed.
  • Special requirements: upon registration, the company will need a proposed company name and alternatives, if applicable, the names of the directors and shareholders.
 Quick Facts 
  Types of companies available for incorporation

The 2006 Act Company

The Limited Liability Company

The 1932 Company

Minimum share capital 

Not in all cases; for 1931 companies the usual authorized capital is £2,000, into shares of £1

Minimum number of shareholders

 1 in most cases (two are required for some types of public companies)

Beneficial ownership

regulated through the Beneficial Ownership Act 2021; disclosure requirements are in place

Time frame for the incorporation (approx.)48 hours for the standard incorporation
fast-track incorporation is available, in 2 hours
Corporate tax rate

0% rate for resident companies

Dividend tax rate


VAT Rate20% standard rate
5% and 0% reduced rates
Do you supply a Registered Address? (YES/NO)Yes
Local Director Required (Yes/no)No, however, a registered agent is mandatory
Annual Meeting RequiredNot necessarily; applicable in case of 1931 Act Companies
 Is Accounting/Annual Return Required?Yes 
 Any Tax incentives (if applicable)N/A 

Apart from the conditions mentioned above, there are a number of key costs for offshore company formation in the Isle of Man:

  • 1GBP: this is the minimum paid-up capital for the private limited company; a usual authorized capital value can be 2,000 GBP;
  • 195 GBP: the value of the Government fees for company formation, not including taxation; please keep in mind that these fees can be subject to change and we recommend verifying this in advance or reaching out to our agents for updated information;
  • 360 GBP: recurring government costs for a company in the Isle of Man;
  • 1-5 days: the usual time needed for Isle of Man company formation.

Companies in the Isle of Man are required to have a unique name and it can be verified via the online portal provided by the Isle of Man Government. The name availability is also checked if an investor wishes to change the name of an existing company. There are a set of conditions for choosing the corporate name and they refer to originality as well as the description of the business activity or the inclusion of certain words. Names that may be refused are the ones that:

  • are identical to one already registered in the Isle of Man or to a business registered in another jurisdiction;
  • are not distinctive for the business activity and falsely describe the company;
  • are similar to names already registered in the Isle of Man or in another location and may cause confusion among clients;
  • contain restricted words such as “bank”, “building society”, “royal”, “king”, “queen”, “prince”, “Windsor”, etc.
  • were used by companies that were dissolved or struck off from the Register in the last five years.

This list of situations in which the names can be refused is not an exhaustive one. The authorities have complied a document, the Company and Business Names Regulations 2013 that can be detailed further by our team of Isle of Man company formation agents.

The video below is a presentation of the requirements for opening an offshore company in the Isle of Man

Annual requirements for companies in the Isle of Man

The annual return is a mandatory document that is filed by all companies within one month after its incorporation date. The requirement to file takes place even when the company is not trading. The fees for the submission vary according to the type of company:

  • for the standard company: £380 for regular filing, £480 for 1 to 3 months delay and £630 for more than three months from the incorporation date;
  • for exempted companies: £95, £195 and £345 according to the same deadlines as above;
  • for registered charities: £0 for on-time filing, £100 and £250 in the two other cases.

The registration is considered complete once the authorities have checked it. If a document is rejected, and the submission is thus not possible on time, the penalty will apply. 

Failure to file the annual return can result in the prosecution of the company or, in some cases, in it being struck off the register. We advise investors to reach out to our Isle of Man company registration agents if they have questions about the filing fees, the filing process or any other issues.

Apart from these annual returns, a company must also file the annual declaration which confirms the fact that it will continue trading and there have been no changes to its particulars. There is no registration fee in this case and the annual deadline for filing is the date on which the name of the company was registered.

Anonymity for offshore company formation in the Isle of Man

Investors who are interested in offshore company formation in the Isle of Man should know that the information on the company directors and shareholders is publicly available, however, the details of the beneficial owner are not included in the public record, just as the financial accounts. This means that a nominated officer can be appointed and indeed many investors will choose this option. A condition is for this person to be a natural person who resides in the Isle of Man or a legal entity that provides services included in Class 4 regulated activities. 

When a nominee is used for setting up a company in the Isle of Man, the law stipulates that this appointed individual will receive details regarding the beneficial owner. The nominee will receive information about the beneficial owner’s personal details (name, address, nationality, the nature and the extent of the interest in the legal entity and other information) and must be notified when any changes occur to these details. When a beneficial owner holds more than 25% of a legal entity, he is included in the Isle of Man Database of Beneficial Ownership and updated as needed. The Act that sets forth these provisions applies to some types of legal entities.

The same Beneficial Ownership Act provides details regarding the duties of the nominated officer as to the manner in which the information will be submitted. As a general rule, the nominated officer is to submit the information concerning the beneficial owners (when applicable) by the date on which the annual return of the company for the following year is due. Any other changes regarding the company’s officers shall be submitted within one calendar month after the nominated officer was made aware of the respective changes. When the company has no registrable beneficial owners, the nominated officer is still required to submit a statement once a year in which he indicates that there are no beneficial owners to be registered. Compliance with the beneficial ownership Act is mandatory.

Changes brough to an offshore company in the Isle of Man

Any changes to the company particulars are to be duly notified to the authorities. This is the responsibility of the company’s agent (the one who is entrusted with updating the company’s documents). In most cases, changes need to ne notified through a proper form within one month of the change. Some of the common changes include the following:

  • Company officer change: a notification is issued each time a company director or secretary is appointed or resigns and/or when any of these individuals change their name, address or nationality; the change is notified within one calendar month from the date of the change.
  • Registered office change: the company’s representatives need to notify any change of the registered office located in the Isle of Man, also within one month from the change; this is an important step because all important documents are sent to the registered office address by the authorities and by failing to provide an updated address the company may not be aware of important documents, thus missing information that could potentially result in the company being struck off the register;
  • Capital changes: any increases in capital or in the manner in which shares are allotted are to be filed within one month.

When a business name in the Isle of Man ceases trading, the Companies Registry needs to be notified within three months through a special form that is signed by the relevant parties (the sole trader or the partners/founders).

Penalties apply for failure to submit the needed forms in all the aforementioned cases. There are two levels of penalties, one for delays of one month and one day to three months and the second level of delay for more than three months. Any document submission for a change in company details is taken into consideration only after the documents have been verified and are deemed to be complete and consistent with the proposed change. If a document is rejected, the applicant may become subject to the aforementioned late fees. Our team can help you with complete information about the changes that need to be notified and can assist you in lodging the changes as soon as possible, once they take place, so that you can avoid these penalties.

Reasons to set up an offshore company in the Isle of Man

The Isle of Man is an international business centre known for its pro-business policies and for welcoming foreign investors in a variety of sectors. The local business ecosystem is a thriving one and some of the most important industries include engineering, retail, real estate, logistics, hospitality and cleantech, among others. Apart from these, investors who open an offshore company provide different types of business services to their international clients.

A stable government, a simple tax regime, good infrastructure, and financial support for certain types of companies are some of the main reasons why investors choose to open a company here.

Many entrepreneurs had chosen to set up an offshore company in the Isle of Man and trade with UK companies. The conditions for international trade changed when the UK ceased to be a member of the EU and are now governed by the UK-EU Trade and Co-operation Agreement which governs how trade in goods is made across the UK-EU border. The manner in which digital and financial services are provided have not changed in the same manner, however, we do encourage investors who are interested in knowing more about the transition to reach out to us if they need clarifications for the business field in which they activate. Some issues with which we can assist include cross-border trade, indirect taxation (VAT), product regulations, intellectual property rights, employment and other issues.

For more information about setting up a company in the Isle of Man, we invite you to contact us.