Fresh eyes on the Isle of Man
It’s the childhood home of the Bee Gees and was the first place to get 3G handsets in Europe, and now the Isle of Man’s propensity to be less costly than other offshore counterparts and reportedly with faster due diligence procedures is starting to turn heads in the private wealth industry.
With a personal tax liability cap of £125,000 per year, a top rate of personal tax of twenty percent, and no capital gains or inheritance tax, the island’s Department of Economic Development is working hard to attract more businesses and UHNWs to its shores, offering grants, financial assistance and relocation managers.
Paul Beckett is senior counsel at MannBenham, a Douglas-based law firm, and he confirms the islands intentions to grow. “Government initiatives to promote our benefits, include the £50 million Enterprise Development Scheme, set up to invest in businesses creating jobs. Companies taking that up are in sectors like bio-med and technology but we want to encourage cryptocurrencies here as well. Regulation is lighter locally to encourage this type of business.
Michael Shimmin is group chairman of Fedelta, a trust company based on the island. He says: “We are still seeing an expansion in private client work here. Our GDP is now bigger than that of Guernsey and Jersey and is growing, and we continue to expand our workforce. For several decades the Isle of Man has been engaged in a catch-up exercise with the other crown dependencies, but now we are matching them.” He continues: “In general terms, we are servicing fewer clients but providing more services to them,” says Shimmin. “We are working with clients with greater wealth, and the sophistication of the planning that’s required has increased.”
Prakash Chandramohan, head of international product at Old Mutual Wealth, says: “In the past, certain jurisdictions promoted privacy and confidentiality of information as a leading benefit. With the advent of the Common Reporting Standards, this is no longer pertinent, so the Isle of Man will naturally benefit from a change in thinking. Related to this, UHNW individuals are now looking for simpler structures and consolidation into one vehicle, making administration and reporting quicker.”
Shimmin says that despite the positive outcome for the Isle of Man, it is likely to put pressure on hiring locally. “To combat this,” says Shimmin, “the government is reviewing the work permit system and amending that so it doesn’t become a discouragement for people to come here to live and work. We have national insurance the same as the UK, and a reciprocal arrangement for the NHS, so the work environment is very UK-familiar which should help us maintain our pace.” He adds though that there will be more consolidation among professional services providers as the costs of business escalate.
Whatever your reason for putting fresh eyes on the Isle of Man, it seems that the UK’s political uncertainty has not proven a ‘Tragedy’ for the island and the Isle of Man is so much more than just ‘Stayin’ Alive.’