When a person dies leaving assets in the Isle of Man, a grant of probate where the deceased left a will, or a grant of letters of administration where the deceased died intestate, must be obtained in order for the deceased's assets to be dealt with.

Given the Isle of Man's status as an offshore financial centre, many non-domiciled people have assets on the island that will need to be collected in the event of their death. This can cause difficulties for those administering the estate of the deceased for a number of reasons. A Manx grant will be required in order to obtain access to the assets of the deceased held on the Isle of Man in almost every case; a grant from the country of domicile of the deceased (even the United Kingdom) or elsewhere will not be accepted.

When applying for a grant in the Isle of Man for a non-domiciled person, a court-sealed or certified grant from the country of domicile, together with a court-sealed or certified copy of the will, where applicable, will be required in support of the Manx application. The Isle of Man Court does not have a resealing process for foreign grants and therefore every application is determined on its merits. It is therefore not inconceivable that the Manx court will refuse to follow the foreign grant if it conflicts with Manx law and procedure.

No inheritance tax is payable to the Isle of Man government. However, an application fee must be paid to the court upon an application for a grant. The fee is based upon the size of the Manx estate, with the largest fee currently set at £649.

The Isle of Man is a separate legal and political jurisdiction to that of the United Kingdom, and therefore is not classified as part of the United Kingdom. When UK residents make wills they are often unaware of this fact and are not advised of it by their UK solicitors. If a person leaves all his or her assets contained within the United Kingdom and does not specifically include assets in the Isle of Man or alternatively leave a Manx will, he or she may be deemed to have died intestate in relation to his or her Manx estate.

When a person dies domiciled outside the Isle of Man and dies intestate in relation to his or her Isle of Man assets, the usual position will be that his or her moveable assets (eg, cash and policies) are distributed in accordance with the law of his or her domicile, while his or her non-moveable assets (eg, land and buildings) are distributed in accordance with the law of the Isle of Man. This can result in those persons who are named in the will of the deceased losing a significant portion of their inheritance if they are not the same person as the statutory beneficiary.

It is therefore vital for those making a will to consider their offshore assets and to seek appropriate advice in that regard.

For further information on this topic please contact Vicki Oates at M&P Legal by telephone (+44 1624 695800), fax (+44 1624 695801) or email ([email protected]).