Information for charities
Application for tax exemption
Exemption to Income Tax can be given to charities and also certain non-profit organisations (NPOs).
What charities can apply for tax exemption?
A charity, which is a company, association or trust, established in Jersey can apply for tax exemption provided it exists for one or more of the following reasons;
- the advancement of education,
- the relief of poverty,
- the furtherance of religion,
- a purpose beneficial to the whole community,
- the service of any church or chapel or any building used solely for the purpose of divine worship.
What type of non-profit organisations apply for tax exemption?
A non profit organisation (NPO) can apply for exemption provided it;
- is established solely or primarily for cultural purposes, and
- receives funds wholly or mainly from the States of Jersey in pursuance of those purposes.
What are the procedures for requesting exemption?
In order to apply for exemption it is necessary to send to the Taxes Office a copy of the constitution, trust deed or other documentation setting out the rules under which the charity or NPO is governed. A covering letter expanding on the aims and objectives can also be useful.
If no formal document exists it will be necessary to draw a set of rules up. A sample constitution is available on the Association of Jersey Charities web site. It is important that the rules contain a provision that in the event of the charity or NPO being wound-up, the funds are distributed to another charity or NPO which has tax exemption.
Association of Jersey Charities website
How is the charity or NPO informed of the Tax exemption?
The Taxes Office will confirm, in a letter, exemption, under Article 115(a) of the Income Tax Law, to income tax. The letter solely confirms the income tax position and does not mean that the body or organisation is a registered charity as there is no Charities Commission in Jersey.
Are annual accounts required?
Annual accounts are not, in most cases, required. However, the Taxes Office can request accounts at any time to ensure that income is solely being used for charitable purposes.
Can charitable Foundations apply for exemption?
The Income Tax Law does not specifically provide for charitable Foundations to be exempt. However, by concession, the Comptroller of Taxes will give exemption, under Article 115 (a), provided:
- the Foundation is set-up solely for charitable purposes,
- provides a copy of its charter,
- provides a copy of its regulations, and
- submits annual accounts.
Where can I find out details about GST refunds?
It is possible for Charities and NPOs to claim a refund of GST. Details can be found on the GST section.
GST treatment for charities and NPOs
How are charities established in Guernsey and the UK dealt with?
Charities from Guernsey and the UK can apply for exemption. A claim is made by providing a copy of the exemption letter from the relevant Guernsey / UK tax authorities.
Only charities established in Jersey can benefit from the lump sum donation scheme.