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VAT

The island benefits from a special relationship with the European Union which allows the streamlined movement of goods between the Island and the Union. The Isle of Man is the only offshore financial centre where zero tax rate companies may operate within the European Union VAT system and trade freely within the European Union.

The VAT rate currently stands at 17.5%, having risen from 15% on 1st January 2010 (future rises in the VAT rate may be introduced following the forthcoming UK general election).

Registration for VAT is required for companies making taxable supplies which at the end of any month, the total value of taxable supplies made during the preceding 12 months (on a rolling 12-month basis) exceeds £70,000.  Also, should a company expect that the value of taxable supplies within a 30 day period will exceed £70,000, then registration will be necessary.