An Isle of Man Corporate Service Provider (‘CSP’) is necessary if you are not an Isle of Man Resident and you have an Isle of Man Company (or you want to set one up) to provide the necessary administration services to your company.
Engaging the ‘wrong’ corporate service provider will cost you both sleep and money, so choosing the right one is an incredibly important decision.
Here are some key points to check when selecting a CSP .
(1) Genuine Isle of Man Substance. Choose a CSP with a real office on the Isle of Man with a (+44 1624) telephone number. It seems like an obvious point but there are numerous providers on the Internet offering Isle of Man incorporation services who don’t have offices in the Isle of Man and are not licenced by our Regulator to provide these services. Needless to say they should be avoided.
(2) Professional Directors. If the CSP is providing professional directors ask them who the professional appointees are and whether they will be involved with dealing with your company on a day to day basis. Ask for a copy of their CV or check them out on Linkedin and ask to meet them or, at least, speak to them on the telephone.
(3) Terms of Business. Ask for a copy of their terms of business. Don’t just read the part which details the fees, read the whole document. If there are parts you don’t like, query these. They might not be prepared to change them but as a new client you should have some leverage at this point so there is no harm in asking.
(4) Fees. As you might expect, CSP fees vary between providers and there is also a degree of ‘risk’ adjustment. Good CSPs are worth the fees they charge so making your choice is not about finding the least expensive provider, it is more about engaging a CSP that treats you fairly and gets the job done well.
Expected levels of fees are set out below for reference:-
(a) Incorporation Fees. In ‘normal’ cases (ie where there are no Politically Exposed Persons or other risk factors and the articles are standard) CSPs Professional fees for incorporating an Isle of Man company tend to range between GBP500+vat to GBP1000+vat. If your structure involves complexities like multiple ownership layers, multiple owners, or trusts of foundations, then the take on process is much more difficult for the CSP so expect to pay more.
(b) Annual fees; CSP charges are generally billed (in advance) on the basis of annual fixed fees for Registered Office, Nominated Officer, & Registered Agent. In total, these would typically range from GBP1500+vat to GBP2500+vat
(c) Directors Fees. Annual fees for the provision of professional directors varies depending on the nature of the engagement but would start at GBP750+vat.
(d) Time charges. Usually CSPs time charges are best avoided, so consider asking if you can have an all in fixed fee. If the answer is ‘no’ or you don’t like their fixed fee quotation, then ask about their time charging policies. In particular (i) Ask them about their charge out rates and whether their staff are targeted to record a minimum amount of chargeable hours. (ii) Ask them if they will provide a breakdown of time spent to the lowest level of detail and whether you can review this before invoices are raised.
(e) Termination Fees. CSPs frequently impose termination fees (sometimes called transfer out fees). In the event that you decide to move, ask for these to be waived.
These questions should help you choose the ‘right’ CSP; alternatively, with more than 25 years of financial services experience in the Isle of Man, we can assist you by using our local knowledge to introduce you to a selection of reliable and reputable service providers for you to choose between.
Contact Martin Katz (tel +44 1624 777900) for more information.