An Isle of Man tax advisor can help save you money.
If you have questions for an Isle of Man tax advisor then contact us. We will either help you ourselves or put you directly in touch with someone who can. (WhatsApp +44 1624 777900 / Martin Katz).
Alternatively, if you would prefer to conduct your own search then here are some things to consider…
Types of Isle of Man tax advisor.
(i) Local tax advisors.
Many Isle of Man tax advisors only deal with local Manx tax matters. Usually they are qualified accountants who live locally here on the Island.
They prepare personal income tax returns for local residents which are required to be submitted to our income tax department annually and also put together the financial statements and associated returns for companies and sole traders.
A good local accountant – like Kevin Mort who works will us will probably have good contacts in the Income tax department, they will deal with any queries on your behalf and they are relatively inexpensive.
Costs for simple personal tax returns start at around £200+vat and business financial statements / returns (if required) might be in the £750-£1000+vat range.
(ii) Relocation tax advisors
If you are a person relocating from the UK to the Isle of Man and you have substantial assets then you may require more specialist advice to address the UK tax aspects as well as the local Isle of Man ones. Some of the issues are complex because extricating yourself and also perhaps your business from the UK tax net (CGT/ IHT/ Tax Residency etc) usually requires some care. See our article Isle of Man tax explained for new residents.
In these more complex case, you will need a tax advisor who understands UK tax matters as well as the Manx ones. In fact these advisors are likely to have more in depth knowledge than most UK accountants who are not usually familiar with the cross border issues that relocations involve.
Cross border tax is complicated and so you may need a Chartered Tax Advisor (CTA) to help you. Becoming a chartered tax advisor is difficult as it requires deciphering tax legislation as much as dealing with the numbers.
The fees charged by CTAs reflect the complexity of the work – so you can expect to pay £150-300 per hour for them.
We have some excellent CTAs in the Isle of Man – can us if you would like discuss your circumstances and we can make an introduction where required.
(iii) Creative tax advisors
‘Creative’ tax advisors are becoming increasingly rare. They are the people who will look at your business or personal arrangements and try to figure out how you might be able to (legitimately) reduce your tax bill. Some of them specialise in using offshore trusts and companies, others focus on remuneration planning or buy to lets. They are often engaged by wealthy families for generational planning purposes. Again the focus is often on cross border matters.
More than ever before, this type of international tax planning is a minefield of rules and regulations – but for very wealthy families this type of planning remains very effective and (they would say) necessary.
Often they are lawyers or chartered tax advisors or both and often – many are to be found in large London professional firms but we have some good ones here on the Isle of Man too.
In terms of fees – as you would expect; they are expensive – £350 plus per hour but sometimes they will charge on the basis of a % of tax saved.
(iv) VAT Advisors
VAT is complicated. Particularly where it is cross border or on buildings / yachts or aircraft. Most accountants happily deal with straightforward domestic matters – which make up 95% of situations. For the other 5% then the services of a VAT specialist are an absolute must. Getting the VAT wrong can be costly financially as mistakes compound and in the very worst cases it potentially send you to jail.
In terms of fees – expect – £200-400 per hour. If advice is taken in a timely fashion and a compound error is avoided this is money very well spent.
(v) Tax correction specialists.
The final type of Isle of Man tax advisor – is the one that you probably least want to engage but in some circumstances they can be the one who you need the most and may be most thankful to.
These are the people who you engage when it’s all gone wrong and as a result of incorrect returns you are required to correct matters with the tax authorities.
As well as understanding the complex tax rules, they also understand the penalty regime. They will analyse your situation, put a detailed case together for the authorities (eg HMRC) to review and negotiate a settlement on your behalf. In some cases, if agreement cannot be reached, they will help you take a case to a tribunal.
Usually these advisors are CTAs and their fees reflect that.