IN529 - Representative of Overseas Business and the Advantages Available when Moving to the Isle of Man

The Isle of Man, United Kingdom, Channel Islands and Republic of Ireland collectively form a ‘Common Travel Area’. In effect this means that travel between each jurisdiction is deemed to be an internal domestic journey and there are no separate immigration controls in place.

This, of course, is not the case for foreign nationals journeying to members of the ‘Common Travel Area’ from overseas. It is then important to follow the immigration rules carefully to ensure that a suitable visa is applied for and held.

The Isle of Man has its own Immigration Rules and Immigration Service. The United Kingdom’s Immigration Rules are extended to the Isle of Man, whereby the Isle of Man makes modifications to reflect its different constitution.

Different Types of Visa

There are numerous different options available to foreign nationals, including 4 main options at Tier 1: a Tier 1 Investment Visa, Tier1 Entrepreneur Visa, Tier 1 Graduate Entrepreneur Visa and a Tier 1 Exceptional Talent Visa. There are also a range of Tier 2, Tier 5, Study and Family Visas available, depending on individual circumstances.

An additional option, which can be very beneficial for businesses wishing to set up an office in the Isle of Man, is the ‘Representative of Overseas Business’ Visa - or ROB.

What is a ‘Representative of an Overseas Business’ Visa – ‘ROB’?

A ROB Visa is an option for senior and experienced individuals to gain an initial 3-year Visa (possibly extending for a further 2 years) by relocating to the Isle of Man and setting up a branch or subsidiary of an overseas company. The basic requirements are as follows:

  • Overseas company establishes an Isle of Man branch or subsidiary.
  • The applicant is the sole representative working full-time within the business.
  • Must have been originally recruited and employed outside the Isle of Man.
  • Must be experienced and of senior status within the company and have the authority to establish and operate the entity.
  • The applicant cannot be a major shareholder in the parent company.
  • The initial 3-year Visa can be extended for a further 2 years and with ‘ILR’ (Indefinite Leave to Remain) after 5 years – with an option to Naturalise.
  • KOLL (Knowledge of Language and Life) required at the time of the application.

Timescales and Pros and Cons of using a ‘ROB’ Visa

The earliest an application can be made is 3 months before travel and a decision on the Visa should be received within 3 weeks of the application, when applying from outside the ‘Common Travel Area’.

ROB can:

  • Work full time for their employer.
  • Bring family members to the Isle of Man.
  • Extend the Visa multiple times.
  • Apply to settle after 5 years.

ROB cannot:

  • Work for themselves or any other business.
  • Stay in the Isle of Man if the arrangement is ended by the employer.
  • Switch to this Visa from another Visa category.
  • Receive public funds (Income Support etc.).

Government Support for New Businesses

The Isle of Man Government has created a wide-ranging support package to attract and retain businesses of many types. A brief outline of 4 of these initiatives is detailed below:

  1. Financial Assistance Scheme – A wide-ranging scheme offering financial assistance/grants of up to 40% of first year costs to the business. This assistance, given on a case by case basis and paid retrospectively, may include building refurbishment, office equipment, marketing activity, set-up costs, legal and professional fees, rent and training.
  2. Key Employee Concession – Introduced in April 2003 to attract new businesses and employees to the island, this concession applies to key employees within a business who will be taxed on their Isle of Man employment income, benefits in kind and rent only. All other sources of income, either Manx based or outside the island, will not be chargeable to income tax. This concession is available for the first 3 years of employment only and must be agreed in advance with the Assessor of Income Tax.
  3. Relocation Expenses – Introduced from 6th April 2016, ‘reasonable relocation expenses’ (e.g. removal costs, legal costs of selling and then buying in the Isle of Man) paid by the employer, of up to £20,000 to the employee, will be exempt from any charge to income tax. In addition, travel expenses and temporary accommodation in the Isle of Man may also be exempt from income tax for an initial period.
  4. Tax Cap – A statutory income tax cap was introduced in 2006 as a Government initiative to attract wealthy entrepreneurs to live on the island. For the tax year 2018/2019, the ‘Tax Cap’ is £150,000 for an individual and £300,000 for jointly assessed couples. To elect for the tax cap an individual would apply to be taxed as such and, once approved, commit to paying the tax cap for a period of 5 consecutive tax years.

Case Study

Step 1 – Overseas parent company decide to set up an Isle of Man subsidiary of a branch and approach Dixcart to provide support.

Step 2 – Application for Representative of Overseas Business (‘ROB’) made to Isle of Man Immigration Office.

Step 3 – ROB application is approved and the foreign national relocated to the island to manage the business.

Step 4 – ROB works with Dixcart to incorporate the Isle of Man company.

Step 5 – ROB works with Dixcart to ensure business is compliant with necessary regulations where applicable.

Step 6 – ROB recruits local staff and/or EEA and/or Non-EEA staff subject to the job criteria.

Example

Next Steps

Dixcart’s Isle of Man office has been supporting businesses to establish real substance on the island for over 20 years and is therefore a very experienced partner to help guide a business through this process. With a skilled team in place and having provided managed office facilities on the island for over 10 years, it would be difficult to find a better organisation to help ensure that a business succeeds.

If you are interested in setting up a FinTech or other business in the Isle of Man, please contact us using the contact details below.

Additional Information

If you require any further information regarding the above article, please speak to your usual Dixcart contact or to Simon Kelly at the Dixcart office in the Isle of Man: advice.iom@dixcart.com.

Dixcart Management (IOM) Limited is Licensed by the Isle of Man Financial Services Authority

 

Categories: Isle of Man, 2018