The Isle of Man, along with Malta, have been extremely popular locations for gambling operators over the years as they have provided businesses within this particular sector with plenty of opportunities, advantages and benefits from setting their business operations in the aforementioned areas.
Why is the Isle of Man so popular?
The Isle of Man was the first jurisdiction to introduce legislation aimed at regulating electronic gaming and gambling companies while providing statutory protections for online customers.
The Isle of Man is whitelisted by the British Gambling Commission, allowing those with an Isle of Man gambling licence to advertise in the UK. The island is rated AA + Standard & Poor’s, and its legal system and legislative practices are based on British principles. The island also provides political stability and an experienced labour force.
Why is the Isle of Man a Favourable Location for Gambling Operators?
In a nutshell, one of the major advantages that is available is the tax relief that organisations that operate in this particular business can receive, as it is extremely attractive for companies looking to establish themselves.
There are also a number of other different benefits that gambling operators can receive when looking to establish themselves in the Isle of Man, such as the following:
- Simple and quick application process.
- World-class infrastructure.
- A diverse economy.
- A general “pro-business” environment.
As mentioned, there is an advantage of receiving a tax break from the authorities when establishing a gambling operation in the Isle of Man. This tax system has the following features:
- Zero rate corporation tax .
- No capital gains tax.
- Taxation of individuals – 10% lower rate, 20% higher rate, which is capped at a maximum of £125,000 per annum.
- No inheritance tax.
Gambling Operation Duty Fees
Gambling operations duty fees that need to be paid in the Isle of Man are extremely competitive, compared to many other countries around the world. The duty payable on retained gross profits is:
- 5% for gross gaming yield not exceeding £20m per annum.
- 5% for gross gaming yield between £20m and £40m per annum.
- 1% for gross gaming yield exceeding £40m per annum.
The exception to the above is pool betting which carries a flat duty of 15%.
Regulation and Fund Separation
The online gaming sector is regulated by the Gambling Supervision Commission (GSC). Player funds are maintained separately from the operators’ funds to ensure that the players’ cash is protected.
IT Infrastructure and Support Services
The Isle of Man has an advanced telecommunications infrastructure, which is extremely important for gambling operators. The island has a very large bandwidth capacity and an extremely stable platform, which is supported by “self-healing” SDH loop technology. The Isle of Man also benefits from five “state-of-the-art” data hosting centers and has IT and market support service providers with extensive experience in the gambling industry.
What is Required to Secure an Isle of Man Gambling Licence?
There are a number of obligations that need to met for gambling operators to acquire a gambling license, including:
- The business is required to have a minimum of two company directors resident in the Isle of Man.
- The business must be conducted by an Isle of Man incorporated company.
- The servers, where the bets are placed, must be hosted in the Isle of Man.
- Players must be registered on Isle of Man servers.
- Relevant banking must be carried out in the Isle of Man.
With a relatively easy criteria to satisfy and the attractive tax relaxation laws related to the gambling industry, it is not difficult to see why the Isle of Man is a place where gambling operators love to have their business operations.