Publications

Attribution Regime for Individuals

The Attribution Regime for Individuals (ARI) will apply to Isle of Man resident individuals who have a shareholding in an Isle of Man resident company. In certain circumstances the taxable/distributable profit of the company will be attributed and assessed to tax on the shareholders.

For simplification, under ARI a company will either be defined as a trading company or a non trading company. In order for a company to be deemed as a trading company the income from trading activity must comprise of at least 50% of the gross turnover.

Trading Companies

In order for the company to avoid having its profits attributed to its Isle of Man resident shareholders it must distribute at least 55% of its distributable profit. The company must make this minimum distribution no later than 12 months after the end of its relevant accounting period. If the minimum distribution is not made then 100% of the companies’ distributable profit will be attributed to the shareholders 12 months after the end of the relevant accounting period.

If the distributable profit of a company is attributed to the shareholders then any subsequent distribution from the relevant accounting period will not be charged to income tax on the shareholder.

Non-Trading Companies

The distributable profits of the company will be attributed to the shareholders in all cases 12 months after the end of the relevant accounting period.

Any distributions made from the relevant accounting period will not be charged to income tax on the shareholder.