HM Revenue & Customs Service's Brief Number 56/09: Update
On the 2nd September we posted a note on the publication of the above practice note from the United Kingdom HM Revenue & Customs service (HMRC). We stated then that we should review the impact of the same upon Isle of Man arrangements after due consideration.
At a Meeting between ourselves and the Isle of Man Customs and Excise Department at the end of November the impact of the Brief was reviewed.
We shall be informing our clients directly on the ramifications of the impact of the Brief upon arrangements entered into in the Isle of Man.
We are able to confirm that the Manx Customs and Excise service has withdrawn support for a letter they issued in 2000 approving structures whereby a demise charter or lease of the vessel to a private individual could be arranged deferring liability to VAT over a 20 year period. The Manx Authorities have indicated that there is no longer any support for such structures and that they are to be wound up as soon as practicable.
It has been indicated that a target date of late March 2010 will be applied.
Other arrangements relating to the charter of vessels on a commercial basis will be carefully reviewed. Those not considered sufficiently commercial will also have be wound up.
We are advising parties with structures established in the Isle of Man to carefully review their arrangements to ensure they comply with the new regime relating to the same. Alternative structures may prove to be appropriate in certain circumstances.
Queries relating to the impact of 56/09 may be directed to Duncan Swanson Duncan@SafehavenInternational.com or Richard Bach Bach@SafehavenInternation.com
