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VAT

The Isle of Man 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.

Businesses trading in the Isle of Man may apply to register for VAT in the Isle of Man providing that they can show that day to day management and control of the business is effected from the Island.  Once VAT-registered, any Isle of Man business is subject to the normal UK/EU VAT rules.

Registration for VAT is compulsory 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 £83,000.  Also, should a company expect that the value of taxable supplies within a 30 day period will exceed £83,000, then registration will be necessary.  The VAT rate currently stands at 20%.