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Isle of Man: Offshore Legal and Tax Regimes

Taxation of Foreign Employees of Offshore Operations

This page was last updated on 31 January 2020.

There are no special rules applying to foreign or Manx employees of offshore operations. The various exemptions from income tax described in the introduction do not apply to employees; any business employing and paying people on the Isle of Man will have to operate the income tax instalment payments (ITIP) system of deductions from pay (based on and similar to the UK PAYE system).

It is not legal to employ non-Manx people on the island without a work permit. See Personal Taxation for the general principles of individual taxation on the island, which also apply to the resident employees of non-resident entities. Most types of payment and benefit paid to employees are taxable; there are no special privileges or exemptions for expatriate workers.

There is no statutory definition of residence. The Isle of Man often follows the UK in this respect. Normally, an individual is resident if he spends more than six months on the island in any one year, or more than three months on average in each of four consecutive years.

Non-residents are liable to pay Manx income tax only in respect of income arising on the island or from Manx sources. By concession, Isle of Man bank interest is not taxed in the hands of non-residents.

 

 

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