The Isle of Man brings together a number of characteristics that make it one of the top locations in Europe for fund domiciliation. A low tax regime is among the top of these reasons.
The types of investment funds in the Isle of Man that are available to investors suit a number of purposes, they can have different investment levels, they can be sold to the general public (or not) and they can be specialist funds.
Our team of Isle of Man company registration specialists highlights the main types of funds available to foreign investors and enumerates some of the conditions applicable to locally domiciles fund products.
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The Collective Investment Schemes Act 2008 and its subordinate legislation govern collective investment schemes or funds in the Isle of Man. Currently, seven current schemes are recognized, with the following characteristics:
There are also two types of superseded fund types, the full international scheme (replaced by the regulated fund) and the experienced investor fund or EIF (replaced by the qualifying fund).
One of our agents who specialize in offshore company formation in the Isle of Man can provide investors with more details about each of these types of funds and the applicable regulations, as per the Collective Investment Schemes Act. For example, specialist funds are regulated in Paragraph 4 of the Collective Investment Schemes Act 2008 and the Collective Investment Schemes (Specialist Fund) Regulations 2010. One of our agents can give you more details.
Open-ended retail funds are a type of investment fund in Isle of Man that is open to retail investors, designed to provide individual investors with access to a diversified portfolio of investments, which may include equities, bonds, and other asset classes.
There are three types of open-ended retail investment funds in Isle of Man that can be set up, which differ in their level of regulation:
Please contact our specialists for guidance in the different types of open-ended retail investment funds, as well as with opening a company in Isle of Man.
Closed-ended retail funds are a type of investment fund in Isle of Man where participants invest their money for a fixed term and are not able to withdraw their investments during that period.
These closed-ended funds are regulated funds and are subject to regulation under the Collective Investment Schemes. However, closed-ended funds that are not available to the public, such as those that have 49 or fewer investors or require a minimum initial investment of USD100,000 per investor, are exempt from these regulations.
You can discuss more about close-ended retail funds with one of our lawyers, who can also offer insight about setting up a company in the Isle of Man if you are interested.
For some of the types of investment funds presented above, an important regulation is to have an Isle of Man manager. Moreover, it is also a common condition to have an appointed trustee or fiduciary custodian.
investors who are interested in Isle of Man domiciled fund products should also have in mind a number of other issues:
The Isle of Man offers a wide array of vehicles that can be used as fund structures, among which the open-ended investment companies, the protected cell companies or the limited partnerships. Setting up a company in the Isle of Man is straightforward and interested foreign investors can receive personalized assistance from our experts.
The Isle of Man has a tax system that is very friendly to investors because there is no capital gains tax, inheritance tax, or stamp duty. There is a type of tax called corporation tax, but it is charged at a zero percent rate, except for income from deposit-taking (which is taxed at 10%) and real estate in the Isle of Man (which is taxed at 20%). Our accountants in Isle of Man can help you with the taxation of investment funds.
Also, The Isle of Man has made agreements with many other countries to prevent double taxation. Investors and fund managers need to be aware of these agreements and how they might affect the tax treatment of investment funds in the Isle of Man.
The fees charged by fund administrators and investment managers in the Isle of Man are not subject to a type of tax called VAT, except for certain types of funds. If VAT is charged, it depends on where the fund is established.
Different types of investment funds in Isle of Man may have different tax treatments, so it’s important to understand the specific tax implications of each fund before investing. You can contact any of our Isle of Man company registration specialists for more details regarding this subject. They can also help you with moving to Isle of Man if you wish to know more about immigration policies.
Investors in the Isle of Man can rely on the expertise and the services provided by our local team of accountants. Taxation in the Isle is favourable for companies, however, the consistent advice and the recommended approach offered by a CPA can be invaluable, especially for tax planning purposes in the context of using an investment fund. Contact our accountants in the Isle of Man for details about our services and solutions.
According to a statistical bulletin issued by the Isle of Man Financial Services Authority, there were:
These statistics are useful for showing Isle of Man’s position as a fund center in the region. For more information about the types of investment funds, their management, control, and other considerations, please contact our team of Isle of Man company formation agents.