Income Tax FAQs

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Q. When do I first have to complete a Tax Return?
A. There is no minimum age before an individual becomes liable to income tax. It all depends on the level of income. There are thresholds known as small income exemption limits. For the year of assessment 2006 these are £11,020 for a single person and £17,680 for a married man. These limits may be increased depending upon personal circumstances e.g. if you have children, if you are a single parent, if your wife is working or if you are over 63 years of age. Any person who has not received a Tax Return and suspects they may be liable to tax should contact the Income Tax Office.
Any individual who is not under the age of 17 years on 31st December should register with the Income Tax Office to obtain an effective rate. Failure to register will result in an employer deducting 20% from each pay until an effective rate notice is received.
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Q. What happens if I do not agree with my assessment?
A. When you receive your Notice of Assessment check it carefully. If you think that any of the figures are incorrect or you are dissatisfied with the assessment made on you, you should submit a notice of appeal within 40 days of the date the assessment was issued. The appeal must be in writing and must specify the grounds of the appeal. You must also arrange for payment of the tax that is not in dispute.
It is important that you ensure that sufficient is paid on account by the late payment surcharge date in early December to avoid a 10% surcharge being applied.

Notices of Assessment & the Income Tax Instalment System (ITIS)
Q. What publications are available to help me with any further queries I may have?
A. The following can be viewed and downloaded:
Q. What happens if I separate from my spouse?
A. Firstly, you should notify the Income Tax Office of the date of separation. Where a husband has been making a joint statement, he must declare on his Tax Return his income for the whole of the year and his wife’s income from 1st January to the date of separation. His wife will be issued a Tax Return to complete in which she must declare her income for the period from the date of separation to 31st December. He will be taxed as a married person and she as a single person. In subsequent years both will be taxed as single persons.
Q. What deductions and allowances can I claim?
A. These are numerous and will depend upon your own personal circumstances. Some are given automatically whilst others require a claim to be made. They include, for the year of assessment 2006:
Deductions.
Employment expenses. Personal pension premiums. Interest paid to a bank on certain qualifying loans; for example a loan to purchase your main residence.
Maintenance payments. Life assurance premiums. Medical insurance premiums.
Allowances.
Single persons allowance £2600. Married persons allowance £5,200. Earned income allowance up to £3,400. Wife’s earned income allowance up to £4,500. Child allowance £2,500 or £5,000 if in further education. Additional personal allowance £4,500. Child care relief up to £6,150.
Rates of Tax and Personal Reliefs for 2006 and earlier years
Q. What happens if I get married?
A. There will be two Tax Returns to complete in the year of marriage. A wife must declare on her own Tax Return, her income arising for the period 1st January to the date of marriage. Thereafter her income must be entered on her husbands Tax Return. She will be taxed as a single person and he as a married person. Each will receive their own Notice of Assessment. In subsequent years only one Tax Return and one Assessment is issued to the husband. He is legally responsible for completing this Tax Return and paying the tax due on the combined incomes.
Q. What is the yearly cycle?
A. The standard rate of tax is set each year by the Finance (Jersey) Law, a piece of legislation that is enacted annually at the time the Budget is presented to the States (usually in early December). The standard rate has continued to be set at 20p in the £ for more than 50 years. It is also at this time that any amendments to the Income tax Law are announced (e.g. changes to the allowances and reliefs).
In January the Tax Returns are issued to individuals asking them to supply details of their income, deductions and allowances for the year just ended. Failure to submit the completed tax return by the last Friday in May will render the individual liable to a fine of £200. This deadline is extended to the last Friday in July if the individual has secured the services of a professional tax agent to act on their behalf. Failure to complete a return at all could render the individual liable to a fine of up to £2000. The assessments to tax are completed before the end of August. In September the Notices of Assessment are issued. These show what income has been assessed, the deductions and allowances granted and the amount of income tax due.
For individuals whose sole income arises from employment, the tax due will be collected under the Income Tax Instalment System. For those individuals with minimal or no employment income, a payment on account must be paid by April each year with the balance being paid by early December to avoid a 10% surcharge.

The Income Tax Instalment System – a brief guide
Q. Can a husband and wife complete separate Tax Returns and receive separate assessments?
A. If you are a married person, you may elect for a separate assessment. This measure is to allow spouses who desire it, some autonomy and privacy in conducting their tax affairs. Either spouse can make a request in writing by the end of October and it will then apply for that year of assessment onward. If you marry later in the year and wish to apply, you have one month from the day of your marriage. IMPORTANT: There is no cash advantage to separate assessments. In other words, there is no difference to the total income tax liability had you not made the election.
Separate Assessments - more information
Q. What happens if I fail to declare all my income?
A. If an investigation into your tax affairs reveals that you have omitted income from your Tax Returns and have failed to pay the correct amount of tax, it is likely that a fine will be charged in addition to the tax due.
The maximum penalty for negligently making a return is £2,000 for each offence plus 200% of the tax lost. For example, insufficient care in making returns for three years which led to further tax of £2,000 would produce a maximum fine of £10,000. This fine is in addition to paying the tax of £2,000.
The maximum penalty for fraudulently making a return is £2,000 for each return plus 300% of the tax lost. For example, if you deliberately made incorrect returns for three years resulting in tax lost of £2,000, the maximum fine for these offences is £12,000. Again, this fine is in addition to paying the tax of £2,000.
It is the Comptroller’s general practice to accept a money settlement consisting of the tax plus a fine rather than institute proceedings before the Royal Court. Although he can give no undertaking as to whether or not he will accept a money settlement in a particular case, he is influenced by the fact that a person makes a full confession of any offence to which he has been a party and has given full facilities for investigation. It is therefore very important to ensure that all your taxable income is declared on your Tax Return. If you are in any doubt a source of income should be declared, contact the Help Desk on 440300.
Income Tax Investigations and more information on Interest and Penalties
Q. What happens if I delay paying my income tax?
A. There is a surcharge for late payment of tax. If you have not paid your tax in full by 6 pm on the surcharge date (around the first week in December), 10% will be added to any sum that remains unpaid. In addition legal proceedings may be taken to collect arrears of tax. This will result in legal costs being incurred, which you are bound to pay. If, for any reason, you have a problem settling your tax on time contact the Help Desk on 440300 for assistance.
As all employees automatically suffer ITIS deductions from their earnings a proportion of their liability will have been paid throughout the year. The surcharge will not apply to individuals who have paid in excess of 70% of the tax due on their employment income through ITIS deductions.
Individuals who are required to make a payment on account in April must still ensure that the balance of the liability is paid in full by the surcharge date to avoid a 10% surcharge being applied.
The Income Tax Instalment System – a brief guide
Q. Whom do I contact if I require assistance with my Tax Return?
A. The Tax Return is issued with a comprehensive set of instructions. However, if you do require some assistance you can, in the first instance, telephone the Help Desk on 440300.
Q. How can I find out how much income tax I will have to pay?
A. Rather than wait for the Notice of Assessment in September it is possible for your Assessor to provide you with an estimate of the tax due. The appropriate time to request this is when you submit your completed Tax Return.
Q. What happens in the event of death?
A. When someone dies, the person responsible for settling his or her affairs and for administrating the estate is known as the executor or administrator. Before you can act as an executor or administrator, you will normally have to get legal recognition. This takes the form of a document known as the ‘grant of probate’ or, if there is no will, ‘letters of administration’. If you have not already obtained legal recognition, you should contact the Judicial Greffe – Probate Section – for further advice. The Comptroller will need to see this document. The executor or administrator must also complete a Tax Return for the year in which death occurred and settle any income tax due (including arrears of tax). The administrator or executor may receive income due to the estate from the date of death until the administration of the estate is completed. If so, a further Tax Return must be completed covering the period of administration. The whole of this income will be assessed to tax at the standard rate of 20p.

In the Event of Death - further information