A Protocol amending the Double Taxation Arrangement between the UK and the Isle of Man has been entered into by an exchange of letters between HM Treasury and the Government of the Isle of Man.

The amendments remove a potential loophole that may have allowed certain non-UK resident property developers to avoid income tax or corporation tax in the UK in certain circumstances and are effective from 16 March 2016.

Chief Minister Allan Bell MHK said: ‘In agreeing to this amendment we are continuing with our longstanding policy of cooperating with the UK to counter tax avoidance and evasion.’

The Chief Minister added: ‘The UK is changing its own law to ensure it can tax UK property development. The amendment agreed makes sure that the Isle of Man’s 1955 Double Taxation Arrangement (DTA) cannot be used to circumvent this change and similar changes are being made by Jersey and Guernsey for the same reason. The Island’s agreement with the UK is very old and is already scheduled to be renegotiated later this year. The change introduces text that you would expect to see in any modern OECD standard DTA.’