Key Employee ConcessionThe Key Employee Concession 'KEC' can be extremely beneficial to new arrivals to the Island, whether you are an entrepreneur setting up a new business, or a key employee being hired to develop or expand a new or existing company.
The Key Employee Concession (‘KEC’) can be extremely beneficial to new arrivals on the Island, whether you are an entrepreneur setting up a new business, or a key employee being hired to develop or expand a new or existing company.
The concession provides that, when applicable, an individual will only be liable to Manx income tax on Manx source income. In essence, they will only be taxed in respect of Manx income and benefits in kind and there are further exclusions such as Manx dividends and bank interest which make the KEC even more appealing.
Only the individuals remuneration from employment, benefits in kind and rent arising from property in the Island is subject to Manx income tax, meaning that their worldwide income can be received tax free. The KEC currently applies for three tax years. Individuals who move to the Isle of Man as a key employee in the establishment or expansion of a business, or set up their own business, and are essential to the implementation and operation of the business, can apply for the concession. In order to grant the KEC, the Assessor of Income Tax must be satisfied that the new business is in the economic interests of the Isle of Man and will provide additional employment in the Island.
This could be extremely beneficial to those who have substantial income streams from non-Manx sources and who are considering a relocation to the Island to set up a business. Key workers and entrepreneurs must be employed by the business on the Island and receive a salary which reflects their key status.
It must be noted that this is a concession and therefore at the discretion of the Assessor of Income Tax. Applications are handled directly with the Assessor, however there are a number of on-island intermediaries and advisors who are able to provide further information on eligibility.
There is further information about the Key Employee Concession available here.