Income Tax
Isle of Man residents enjoy some of the lowest tax rates in Europe with a simple and efficient calculation system. Our low tax rate allows you to enjoy more of your hard earned money, thus improving your quality of life.
In the Isle of Man, residents enjoy low taxes; pay 0% Capital Gains Tax, 0% Inheritance Tax, and 0% Stamp Duty. Residents can also easily and expediently file their annual tax return via our online system.
What are the tax rates in the Isle of Man?
The Isle of Man operates a simple taxation regime with two tax rates (or bands) for individual personal income. The standard (or lower) rate is 10% and the upper rate is only 20%.
The standard rate (10%) tax threshold is £6,500 for a single person, £13,000 per couple. The remaining balance is taxed at the upper rate.
Is there a tax cap?
Yes. The tax cap is £200,000 for an individual and £400,000 for a jointly assessed couple.
Under the tax cap system, an individual must elect for the tax cap to be applied and, if the election is approved, it will apply to the individual for a period of five or ten consecutive tax years.
What are the personal allowances?
For the 2023/2024 tax year, the personal allowance (tax free earnings) for a single person is £14,500* and for a jointly assessed couple, £29,000*.
*From 6th April 2023 the Personal Allowance is reduced by £1 for every £2 that a person’s income is in excess of £100,000 or £200,000 for a jointly assessed couple.
Example Income Breakdown
So what do all these numbers mean? If you are a single person (claiming no additional dependents or allowances), earning £30,000 per annum, your yearly income tax liability would be £2,450. Check the table below for an example income breakdown:
Annual income: £30,000
|
Single Person Allowance: £14,500 |
Taxable income: £15,500 (£30,000 income-£14,500 allowance) |
|
Standard tax threshold for Single Person: £6,500 |
10% of £6,500: £650 |
|
Remaining balance at Upper Rate: £9,000 (£15,500 taxable income-£6,500 standard tax threshold) |
20% of £9,000: £1,800 |
Total contribution: £2,450 (only 8.17% of total income)
Isle of Man compared to other Jurisdictions
To see how the Isle of Man compares to other countries, see the chart below:
| Jurisdiction | Tax free allowance (Per person) | Tax Bands |
|
Isle of Man |
£14,500 | 10%, 20% |
|
U.K |
£12,570 |
20%, 40%, 45% |
|
Ireland (£1=€1.15) |
£3,087 (applied as ‘single person credit’ and an 'employee tax credit') | 20%,40% |
| Gross Income | £25,000 | £30,000 | £35,000 | £40,000 | £45,000 | £50,000 | £100,000 |
| Income tax by Jurisdiction | |||||||
| Isle of Man | £1,450 | £2,450 | £3,450 | £4,450 | £5,450 | £6,450 | £16,450 |
| UK | £2,486 | £3,486 | £4,486 | £5,486 | £6,486 | £7,486 | £27,432 |
| Ireland (£1=€1.15) | £1,913 | £2,913 | £3,956 | £5,956 | £7,956 | £9,596 | £29,956 |
| National Insurance by Jurisdiction | |||||||
| Isle of Man | £1,921 | £2,471 | £3,021 | £3,571 | £4,113 | £4,163 | £4,663 |
| UK | £1,492 | £2,092 | £2,692 | £3,292 | £3,892 | £4,492 | £5,519 |
| Ireland (£1 = €1.15) | £1,000 | £1,200 | £1,400 | £1,600 | £1,800 | £2,000 | £4,000 |
| Total income tax and National Insurance by Jurisdiction | |||||||
| Isle of Man | £3,371 | £4,921 | £6,471 | £8,021 | £9,563 | £10,613 | £21,113 |
| UK | £3,978 | £5,578 | £7,178 | £8,778 | £10,378 | £11,978 | £32,951 |
| Ireland (£1 = €1.15) | £6,000 | £7,200 | £8,443 | £10,643 | £12,843 | £15,043 | £37,043 |
*Figures rounded to the nearest £ amount.
All figures are based on £30,000 in annual earnings for a single person claiming no further allowances*
More information on contributions can be found on the Government website.