abacus trust company limited international structuring using the isle of man 6 february 2009
TRANSCRIPT
ABACUS TRUST ABACUS TRUST COMPANY LIMITEDCOMPANY LIMITED
International structuring using the Isle of Man
6 February 2009
AbacusOperating in the Isle of Man for over 30 years
Former fiduciary services arm of Coopers & Lybrand International
Member of Nexia International since January 2005
Professional staff – Lawyers / Accountants / Trust & Tax practitioners
Assets under administration – approx US$6billion
International client base – HNWI and Corporate
Geneva office opened for business 2008
Winner of Large Organisation of the Year 2007
The Isle of ManCrown Dependency of the United Kingdom
‘AAA’ rating (S&P / Moody’s)
Respected financial regulation
Relatively low costs
Fiscal independence: zero rate of corporate tax (Apr 2006)
EU customs territory for VAT
Fast growing offshore centre in thevery heart of the British Isles
The Isle of Man
The Isle of Man
The Isle of Man
First UK Offshore centre to move to a 0% tax regime
Regime complies with both EU and OECD requirements
Many TIEAs and DTAs being entered into to confirm the Island’s commitment to international standards
International Structuring within the Isle of Man – typical vehicles
Trusts
Companies (especially the NMV)
Yacht & Aircraft structures
Funds
Asset structuring
Potential Asset Classes
Financial assets
Non-financial Assets:
– Residential and commercial property
– Private / operating companies
– Single line stock
– Yachts and private jets
– Art and antiques
– Intellectual property
The New Manx Vehicle
Introduced on 1 November 2006
Flexible and streamlined form of company in response to consultation
Administratively simple and cost effective
NMV – Key Features
Flexible Capital Structure
Few constraints on distributions
Flexible capacity and powers
Flexible board structure
Limited filing/accounting obligations
Ability to vary the company
Flexible Capital Structure
No prohibition on financial assistanceNo requirement for authorised share capitalAbility to alter share capital by:– Consolidating– Subdividing– Redenominating
Distributions
Solvency test following distribution
Capital /assets in specie
Can return share premium/capital
without court approval
Capacity and Powers
No restrictions on business activity
Limited required content in
Memorandum and Articles
Significant degree of flexibility in
permitted contents of M&A
Board Structure
Minimum of one director (individual
or body corporate)
No IOM residency requirement
No company secretary requirement
Must have registered agent in IOM
Filing and Accounting
Limited obligations
No notification requirement for:– changes in directors– Alterations of share capital
No filing/audit requirement for financial statements
Records must be “sufficient to determine financial position of the company”
Variations in NMV
Very simple procedures to permit:– Re-registering a 1931 company as NMV– Re-registering an NMV as any other
company– Continuing a foreign company in the
IOM as an NMV (and vice-versa)– Merging/consolidating companies– Converting an NMV to a PCC
The NMV
A vehicle of choice for international structuring
Benefits of the Isle of Man for international structuring
Very flexible corporate vehicle (NMV)
Nil rate of corporate tax
No stamp duty
No withholding tax
Ability to hold an EU VAT registration (ability to recover VAT)
International Agreements
2006 IOM enters into shipping and aircraft DTA with Netherlands
Mirror DTAs now entered into with the following Nordic council countries
Greenland 11 April 2008Finland 14 June 2008The Faroe Islands 3 August 2008Norway 23 August 2008Denmark 26 September 2008Sweden 27 December 2008Iceland 28 December 2008
International Agreements
What can be achieved by utilising the DTAs?
Netherlands or NCC parent forms IOM subsidiaryIOM subsidiary undertakes shipping/aircraft activitiesActivities carried out in “international traffic”This means movement of ship/aircraft is from a port in one jurisdiction to a port in another jurisdiction
International Agreements
What is the tax advantage?
Shipping/aircraft activities only subject to tax in IOM
Rate of tax in IOM 0%
Profits can be stockpiled “tax free” in IOM or reinvested gross
No withholding tax on profit distribution from IOMco
Possibility of using a Netherlands parent and distributing “tax free” via the participation exemption
Who to contact
Craig Brown – Client Director• Telephone: +44 (0)1624 689617• Mobile: +44 (0)7624 463877• Email: [email protected]
Kevin Renshaw – Associate Tax Director • Telephone: +44 (0)1624 689616• Mobile: +44 (0)7624 482438• Email: [email protected]
This presentation is for general guidance only. Action should not be taken without obtaining independent advice.Abacus Trust Company Limited is licensed by the Isle of Man Financial Supervision as a Corporate and Trust Service Provider.Abacus Financial Services Limited is licensed by the Isle of Man Financial Supervision Commission to conduct Investment Business.