Government Offices
Buck's Road, Douglas
Isle of Man IM1 3TX
Enquiries:
+44 (0) 1624 685400
As an Isle of Man resident tax payer, you are entitled to claim certain deductions when you submit your tax return. Provided the Division have all the information required to assess your position, these amounts will be used to reduce your tax liability.
Some examples of current allowable deductions are:
* Please note that a written agreement must be submitted to the Income Tax Division. The date of the first payment under the Deed must not be earlier than the date on which the Deed is made. Only payments made under covenants that have been entered into on or before 05 April 2011 and where the student is in qualifying full time education at that date are eligible for income tax relief.
For tax years prior to 2012/13, general deductions were treated as reducing an individual’s taxable income and tax relief was therefore given at the individual’s effective rate of income tax. From 6 April 2012, relief has been restricted to 10% for certain general deductions. The 10% tax relief will be treated as reducing an individual’s total income tax liability. The general deductions affected are; interest paid on mortgages or loans, charitable donations or deeds of covenant, private medical insurance payments, nursing expenses and educational deeds of covenant entered into on or before 5 April 2011 and where the student is in qualifying full time education at that date.
Before deductions can be granted you will need to provide certain evidence to the Income Tax Division that you have paid the amounts you are claiming. For example, if you claim mortgage or loan relief then your lender will send you a certificate of interest paid for the year - this should then be submitted with your return. The guidance notes provided with your return clearly state what documents may be required when claiming any deductions.
It is important to remember that certain deductions are subject to limits and restrictions, and any relief granted must be within these set parameters and conditions. For example, with effect from 6 April 2011, mortgage and loan interest relief will be capped at £7,500 in total.
The return form guide contains details of limits and restrictions and further details on how to claim the reliefs detailed above.
Additional personal allowances are available for:
A claim for Blind Persons Allowance or Disabled Persons Allowance is made on the annual return form.
The Age Allowance is automatically applied for all resident individual aged over 65 at the start of the tax year. The amount of the allowance will be £2,020 with a pro-rata reduction where a person has ceased or commenced residence in the Isle of Man during the tax year. For jointly assessed married couples, the allowance will be doubled to £4,040 where both spouses are over the age of 65 at the start of the tax year. Any unutilised balance of the allowance can be transferred between spouses in the year of marriage or to the surviving spouse on death.
See Frequently Asked Questions for further information regarding tax relief.
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