The use of an Isle of Man vehicle for property development or redevelopment purposes has the distinct advantage that it can be registered for VAT in one central point, given that the Isle of Man and the UK effectively operate within the same VAT system. The vehicle would therefore be able to reclaim VAT costs on supplies and/or expenses incurred in the UK and/or the Isle of Man.
The Island has a dedicated central point of VAT registration within the Isle of Man Customs & Excise Division, which handles the UK elements of the registration. This allows for a simplified VAT registration process, with the provision of a GB VAT number usually completed within days of application. The Division also has a successful track record in providing 'private sector' service levels and co-operation in relation to commercial ventures.
The Island also has a Double Taxation Agreement with the UK, which states that the commercial profits of an Isle of Man vehicle will not be subject to taxation in the UK unless it is deemed to be conducting a trade or business through a "permanent establishment" in the UK. Isle of Man vehicles are therefore often used for short-term commercial developments or redevelopments where the management and control of the vehicle (and all strategic decisions in respect thereto) are being exercised outside of the UK. Although the directors of the Isle of Man vehicle may delegate certain project functions to an unconnected party in the UK, careful oversight of the project itself will be maintained.
IQE has significant experience dealing with real estate matters, demonstrated by IQE's involvement in a growing number of London based transactions. Our real estate experience ranges from working with one of the leading global developers on residential towers such as Strata SE1, to substantial shopping centres, commercial property, centrally located rental properties, hotels and apartments in prime locations including London, New York, Monaco and Barbados, with single asset values of up to £300 million.
We have the expertise to assist with multi-jurisdictional fiduciary services for international structures
Having worked with IQE for a number of years I have come to appreciate their professional and proactive attitude to the work they undertake. Their helpful and efficient staff ensure that transactions are completed in a timely manner wherever possible. Richard Melhuish, FRICS, Director of Redefine International P.L.C.