Tax relief

Deductions

As an Isle of Man resident tax payer, you are entitled to claim certain deductions when you submit your tax return. Provided the Income Tax 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:

  • Mortgage Interest (subject to certain limits)
  • Loan Interest (subject to certain limits)
  • Superannuation
  • Professional Subscriptions
  • Personal Pension Contributions
  • Charitable Deed of Covenant
  • Charitable donations

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 2017, the maximum amount of mortgage and loan interest for which a single person can claim tax relief is £5,000.

Relief for certain general deductions is restricted to the lower tax rate of 10% and the 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; and nursing expenses.  In the example above, relating to mortgage and loan interest paid, relief of £500 will be available to reduce the individual's total tax liability.

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 interest relief, your lender will send you a certificate of interest paid for the year - this should then be submitted with your return.

Additional allowances

Additional personal allowances are available for:

Further details regarding deductions and additional allowances and how to claim them can be found in the return form guide.