Introduced in 2006, the Isle of Man Companies Act amended existing legislation to give companies based on the island greater flexibility over tax status and investment opportunities. Allowing newly incorporated companies to receive benefits similar to those granted in some Caribbean jurisdictions, the change in economic status has made the island highly desirable for investment incorporation.
Setting up a 2006 Act company allows investors to enjoy the benefits of the Isle of Man's tax cap, and of the reduced taxes many companies enjoy. This can be a big bonus for companies who want to maximise profits, and it also boosts private investors looking to secure funds for the future through holding companies and trusts. As a result, many savvy asset holders are turning to the Isle of Man as a place to set up secure companies and to reap the rewards.
Of course, there are some requirements to maintaining an offshore company on the Isle of Man. Under the 2006 Act, registration is required on an annual basis. A named director must be based on the island, although this can be through a nominee service if preferred. Annual reports for the company must be correctly filed, and any incurred taxes under the IOM's tax cap should be paid yearly. As long as these minimal obligations are met each year, the offshore company will remain a secure and profitable place to hold assets.