If you are from outside of the Isle of Man and considering setting up a company, the requirements and work involved to do so may leave you feeling somewhat daunted. Trying to set up a company, particularly from a distance, may seem like a huge task. However, when you break it down, it is actually all easily achievable.
In this article we look at the steps required to set up a company as a non-Isle of Man resident in order to make the process as smooth as possible.
Can a non-Isle of Man resident form a company in the Isle of Man?
It is important to know the facts from the outset – a non-Isle of Man resident CAN set up a company in the Isle of Man.
There are few differences in the requirements to set up a company in the Isle of Man, whether you reside there or not.
However, irrespective of where you live, there are a number of things to be aware of when setting up a new company. Get this right and you will whizz through the process, saving yourself many difficulties in the long term.
Things to remember when forming a company
The first thing you should do is create a business plan. Whilst this can take some time to do properly, once you have written it and have made the decision that a company structure is the right thing for your business, you will need to consider the following:
A Company Name
Each company must have its own unique, distinctive name so be wary of choosing a name that is too similar to that of another company’s business or trading name. We can check with the Companies Registry before you proceed too far into the process, in order to ensure that the name is not already in use by someone else, does not fall under any prohibitions and that it will receive name approval from the Companies Registry.
Registered Office Address
When choosing a registered address for your company, it must be a physical address and must be in the Isle of Man. You can also engage a licensed Corporate Service Provider in the Isle of Man to provide a registered office and consequently use their address in the Isle of Man. A company’s registered address is publicly available on the online register.
Director(s)
Depending under which Companies Act your company has been set-up i.e. a 1931 Act Company or a 2006 Act Company, there must be at least one individual (or two in the case of a 1931 company) that is over 18 years old and responsible for running the company. However, this person does not have to be an Isle of Man resident and the 2006 Act permits for the appointment of a Corporate Director if provided by an Isle of Man Licenceholder.
Company Secretary/Registered Agent
Depending under which Companies Act your company is to be incorporated, it may need to appoint a Company Secretary or a licensed Resident Agent.
Issue shares
If you choose to set-up a company that is limited by shares, there must be at least one Shareholder. You can also set the initial value of the share.
Create the ‘Memorandum and Articles of Association’
These are legal documents consisting of the ’memorandum of association’, a statement signed by all initial Shareholders (often referred to as Members) which agrees to the company being set-up. The second part is the ‘articles of association’ that set out how the company is to be run, governed and owned as agreed by the Shareholders and Directors. It includes the responsibilities and powers of the Directors and the means by which the Members can exert control over the Board of Directors.
Register for Corporation Tax
The Company, once incorporated, must register for Corporation Tax in the Isle of Man.
Tax returns
the Company will need to produce and file a Company Tax Return every year on the date specified. In the Isle of Man, a company tax return is due for submission one year and one day following the end of the Company’s accounting period. An accountant will normally compile this information and it must be done whether or not the Company makes a profit.
Banking Facilities
It is likely that you will also need a bank account for your Company. This can be an onerous process however as a licensed Corporate Service Provider and with strong working relationships with a number of internationally recognised banks; we are able to assist you with this task.
What next?
Setting-up a Company can be a time-consuming and sometimes complex process, with many other matters and stages requiring significant consideration to ensure the company is set up right and is fit for purpose.
From incorporating a limited company to getting your accounting records in order, Sentient International can assist and guide you through the company formation process.
If you would like to know more about setting up a company or would like to discuss what type of Company would be most suitable to meet your requirements, please contact our team on +44 1624 616544 or email iom@sentientinternational.com.
