The past 18 months have seen unparalleled challenges to all and significant, permanent change in the way in which we work, interact with our colleagues and clients, and look to strategically advance our businesses. This is true for many entrepreneurs and executives working for family businesses and the Crown Dependencies of Jersey, Guernsey and the Isle of Man, as all have seen significant inward migration during the period.
Forced to become more flexible and adaptable to change, the remote working trend has been commented on extensively and whilst in each business this is being carried forward into permanent working culture in different ways and to differing extents, it is fair to say that the world we live and work in has changed for the long term.
The Crown Dependencies have for many years been popular locations for entrepreneurs and business owners particularly as they plan an exit from their business. This has to a large extent been driven by the absence of provisions in the islands’ laws to tax capital transactions. However, increasingly we are seeing movement of senior personnel whose businesses are at different stages of their developmental cycle.
As where we work becomes less relevant to many of us and we have evolved, in many cases more by circumstance than design, to a much more flexible working style, the Crown Dependencies have continued to offer an exceptional hub from which business people can base themselves.
Some of the key characteristics attracting entrepreneurs and senior executives to the Crown Dependencies include the following:
- Stable political, tax and regulatory regimes;
- OECD model tax treaty agreements with the UK;
- Access to exceptional professionals particular in the finance industry with legal, accounting and tax experts to rival any jurisdiction and service providers with decades of experience supporting international families and their businesses;
- Proximity to the UK with daily direct flights less than an hour to most main UK hubs;
- Top quality schooling and a high standard of living;
- Ease of entry for UK passport holders.
In addition to this, each island has a digital focus aimed at providing ideal working conditions for those in the tech space to thrive.
The tax regime for entrepreneurs and executives remain attractive across the islands but care must be taken in planning, both from the perspective of the individual in terms of where they are present and what they do and in terms of their business and the obligations that can fall upon it across its operating jurisdictions. If moving from the UK, it is crucial to fully understand your personal tax position in the context of the statutory residence test and to understand and appreciate the implications on your business as its centre of management and control may or may not transfer with you. This type of consideration requires additional consideration now that we are fully operating within the context of each island’s economic substance regulations.
Increasingly remote working trends have seen many of the clients I work with better able to commit to feasible strategies of living and working in the Crown Dependencies without hampering their effectiveness as business leaders. Indeed, in many cases living and working in the Crown Dependencies has given entrepreneurs and family business leaders that crucial gift of time. Free from excessive commutes, many new arrivals have found themselves with more time to commit to their business strategies as opposed to the day to day challenges that running their business presents.
Similarly, across the globe the pandemic has seen many family businesses assessing their purpose and legacy with renewed focus. The long-term legacy of a family business has always been a key consideration for many and this has been brought into sharper focus as ESG rises up the agenda. The Crown Dependencies are perfectly placed to help family businesses with pursuing these endeavours from the perspective of structuring and having appropriate professionals to help assess and implement appropriate governance structures.
In many cases the need to be physically present at a particular office on a particular day is very much a thing of the past and this has opened up possibilities for many to consider how they can work more effectively and generate a more positive work life balance, which works well for them, their family and their business. The Crown Dependencies are each unique and offer different opportunities for all but what is consistent is that all, for good reason, continue to see an influx of entrepreneurial minds who are met with a community that is open for business and welcoming of initiative. Proper planning is always a must but, when done properly and for the right reasons, there are significant opportunities for entrepreneurs and executives to consider if a move to Jersey, Guernsey or the Isle of Man is on the cards.
If you would like to find out more or discuss anything mentioned in the article, please contact Paul Beale at paulbeale@kpmg.com.
