The Isle of Man (IOM) Budget for 2013/14 took place on 19 February 2013. The proposals announced have no direct impact on Royal Skandia’s business.
- FATCA Update – Agreement expected to be signed with the USA in the near future. A FATCA-style agreement between IOM and UK was signed on Budget Day, bringing in automatic sharing of information on the investments of UK resident taxpayers. This was achieved by extending the double taxation agreement between the two authorities.
- Three-year targets published for all Departments, showing where and how the budget will be balanced by 2015/16.
- National Insurance ‘holiday’ scheme for private sector employers engaging additional staff to continue until April 2015, having led to the creation of 340 new jobs in its first year.
- An extension of the 10% corporate income tax rate (currently covering banking and local development and rental income) to include major retailers with annual profits of at least £500,000.
- A planned reduction in Government headcount of 100 posts per year for the next three years, adding to the 400 posts and 300 staff lost since 2010.
- Capital spending programme of £97m with £44m for construction schemes including £19m for local authority housing.
- Legislation to stop avoidance of Manx income tax through ‘personal service companies.’
- Nursing Care Contribution payment increased from £100 to £110 per week.
- Maximum income tax liability, the ‘tax cap’, remains at £120,000.
- Personal Allowance Credit remains at £500 per person.
- Child Benefit remains the same; £20.40 a week is paid for the first child, £13.50 is paid for second and subsequent children.
- No change to income tax rates, personal allowances or thresholds.
Income Tax Rates and Allowances 2013/14
- Lower rate 10% on £10,500 (£21,000 for jointly assessed couple/civil partners).
- Higher rate 20% on balance.
- Maximum income tax liability £120,000 (£240,000 for jointly assessed couple/civil partners).
- The rate of income tax on taxable income for non-resident individuals remains at 20%.
- Single person £9,300.
- Married couple/civil partnerships £18,600.
- Single parent £6,400.
- Blind person £2,900.
- Disabled person £2,900.
- Age allowance/personal allowance £2,020.
- Personal Allowance Credit - Upper income point £9,300, maximum credit payable £500 (doubled for jointly assessed couple/civil partners).
- Standard rate 0%.
- Banking business rate 10%.
- Land and property in the IOM - including property development 10%.
- Retail trade (with a small companies limit of £500,000) 10%.
- Rates remain the same: 11% for employees, 12.8% for employers, employees’ additional rate at 1%.
- Increase in National Insurance Employees' Primary threshold by £2 per week (£120 per week for 2013/14) and Upper Earnings Limit by £14 per week (£784 per week for 2013/14).
The information provided in this article is not intended to offer advice.
It is based on Skandia's interpretation of the relevant law and is correct at the time this article was written. While we believe this interpretation to be correct, we cannot guarantee it. Skandia cannot accept any responsibility for any action taken or refrained from being taken as a result of the information contained in this article.