Jersey financial and legal system
Jersey is a self-governing Crown Dependency with its own fiscal and legal system.
About Jersey tax
Tax in Jersey is low and relatively straight forward. You’ll pay tax on income, goods and services, but there’s no capital gains or inheritance tax.
The maximum personal tax rate is 20%, and we also have exemption thresholds and a marginal rate of tax to protect people on lower incomes.
Goods and services tax in Jersey is low, broad and simple. The rate is 5% with only a few exemptions.
The standard rate of corporate income tax is 0% with exceptions for financial service companies (10% tax rate), utility companies (20% tax rate) and large corporate retailers (varies depending on the profits, maximum 20%). Company income from property or property development is also taxed at 20%. Any dividend or distribution from the company is taxable in the hands of the shareholder.
Revenue Jersey is the island's tax department and is responsible for administering and collecting personal income tax, corporate income tax, goods and services tax and other revenues.
Jersey’s tax year runs from 1 January to 31 December each year.
Every January, you’ll be sent a personal tax return form to complete for the previous year. You’ll need to complete this and send it to Revenue Jersey by the last Friday in May.
Calculating your personal tax
Standard rate 20%
The Jersey personal tax system is set up so that the maximum rate of tax is 20%. This is called the standard rate.
One of government’s measures to protect people on low incomes is to have an exemption threshold, so if your income is below this you don’t pay income tax. This exemption threshold is set each year and normally increases with the cost of living.
If you have a low income, but it’s more than the exemption threshold, we’ll ask you to pay some tax but it won’t be at the standard rate. Instead, we use a calculation so that you pay a small amount of tax that gradually gets higher as your income goes up.
Calculating your annual tax bill
Marginal rate calculation of personal tax explained
Extra tax reliefs
There are extra reliefs you can claim which increase your tax exemption threshold. This means you can earn more income without paying tax, or your tax bill is reduced.
These extra reliefs include:
- higher married tax threshold
- second earner's relief
- deduction for dependent pre-school and school age children
- an additional allowance if you have a child and are a single parent family or you’re living with your partner but aren’t married
- child day care relief for children under 12 years old
- deduction for mortgage interest payments on your home (until 2025)
Allowances, reliefs and deductions for income tax
Individual's tax information
Paying your tax if you're employed
Income Tax Instalment System (ITIS)
Jersey uses an Income Tax Instalment System (ITIS) to calculate how much tax you’ll need to pay. You’ll receive an instalment rate which is a percentage. This percentage is deducted from your gross pay every time you’re paid.
This instalment rate is only deducted from employment income. If you have income from other sources like pension or property income, you have to pay this separately.
How it works:
- you register for tax and tell us what your income will be
- Revenue Jersey works out your tax percentage which we send to you to hand to your employer. This is called your instalment rate
- the following year you fill out a tax return declaring all your income for the previous year
- Revenue Jersey works out your actual tax and re-calculates the instalment rate. If you’ve overpaid, you may be due a repayment or a reduction in your tax rate. If you’ve underpaid, you’ll need to pay the balance or we’ll increase your rate to cover the outstanding tax
If you don't have an instalment rate to give to your employer, they are legally required to deduct 21%.
Calculating your tax instalments (deduction from earnings)
Paying your tax if you work for yourself (self-employed) or if you've retired
Payment on Account (POA)
If all of your income is from non-salary sources, (for example self-employment income, pension income or property income) you’ll be sent a payment on account notice.
How it works:
- in February, we send you a Payment on Account notice (It’s an estimated payment amount toward your coming tax bill for the year based on 50% of the total tax bill your paid last year)
- you must pay the ‘Payment on Account’ amount by April
- you submit your tax return by the May deadline
- your tax return is used to calculate your actual tax assessment for the year
- we send you this tax assessment once it’s calculated, along with a request for the balancing payment (Your tax for the year less your payment on account)
- the balance is due before the late payment surcharge deadline in December. This date is included on your tax assessment
If you have a small salary, you’ll still have ITIS deducted but this will only account for a small part of your total tax payments. Your payment on account amount issued in February will be adjusted to 40% of last year’s tax.
High value residency
If an individual is approved as a high value resident under the Government of Jersey's
high value residency scheme, their tax rate each year will be 20% on the first £725,000 or worldwide income and 1% on anything over that amount.
Locate Jersey offer a free, confidential service to support applications for
high value residency.
Corporate income tax
The standard rate of corporate income tax in Jersey is 0%.
The exceptions to this standard rate are:
- financial service companies (defined in the Income Tax Law) which are taxed at 10%
- utility companies which are taxed at 20%
- income specifically derived from Jersey property rentals or Jersey property development taxed at 20%
- large corporate retailers with cumulative Jersey retail turnover of £2 million or more, taxed at a variable rate up to 20%
Company tax information
Goods and Services Tax (GST)
The Goods and Services Tax (GST) is a tax on sales of goods and services in Jersey. GST is charged at 5% on the majority of goods and services supplied in Jersey for local use, including imports.
GST quick guide
GST taxed on goods and services
Social Security contributions
Social Security contributions are Jersey’s equivalent of national insurance contributions.
Everyone living in Jersey who is of working age is liable to pay social security contributions.
Contributions go towards:
- Jersey State pension (including survivor’s pensions)
- sickness benefits (Short Term and Long Term Incapacity Allowance)
- maternity benefits
The amount you pay depends on how much you earn and whether or not you’re employed or self-employed.
If you’re employed and you work eight or more hours per week, 6% is deducted from your wage and your employer contributes 6.5%.
If you’re self-employed or non-employed (eg retired early), the amount you pay is worked out from your income two years previously. The maximum amount you’ll pay is £760.13 per month.
If you’re over 18 and in full-time education, you may be eligible for
student credits. These credits will protect your contribution record. This means that you don’t have to pay contributions, but you’ll still be able to claim certain benefits when you need them.
If you have a child under school age and you are either staying at home to care for your child or working 20 hours or less per week, you may be eligible for
Home Responsibility Protection credits. You will need to have been living in Jersey for at least six months to claim. You can claim HRP for a maximum of 10 years over your working life.
If you’re still employed by an employer outside the island, you must provide a certificate of continued liability. This will prove you are paying contributions in that country and are exempt from paying in Jersey. You can get this from your employer.
Quick guide to tax and contributions in Jersey
|Personal income tax||20% maximum rate|
|High value residency income tax ||20% on the first £725,000 of worldwide earned income (equivalent to £145,000) plus an additional 1% on all other worldwide income. |
|20% on revenue from Jersey property|
|Corporate income tax ||0% standard rate|
|10% tax for regulated financial services companies|
|20% tax for Jersey utility and property income companies|
|variable rate up to 20% for large corporate retailers|
|Social Security contribution for employees||6%|
|Social Security contribution for employers||6.5% on earnings up to £4,442 per month, plus an additional 2% on earnings over £4,442 and under £14,686 per month|
The currency in Jersey is the British pound sterling. Jersey prints its own money which can’t be used outside the island. However, it can be exchanged at cashiers for other currency.
There are many banks on the island, including the top UK banks.
The ring-fencing legislation requires a UK bank to separate its retail banking activity from the rest of its business. This is to protect customers’ day-to-day banking services from unrelated risks elsewhere in the banking group.
Ring-fencing was one of several important reforms brought in by the UK government to strengthen the financial system, following the financial crisis in 2007.
This has an impact on you if you have an account in the UK because the Jersey branch of that bank is unlikely to be able to access information about your UK accounts. You may find it easier to open a Jersey bank account instead.
Jersey bank accounts can only be set up on the island. You’ll need to provide personal information to open a bank account. This includes information such as proof of identity, employment and Jersey address.
You can only get a mortgage in Jersey to buy a Jersey property. You can’t transfer a mortgage from another property outside the island.
States (old age) pension
The pension age in Jersey is 67.
If you work and pay social security contributions in Jersey for a minimum of 4.5 years, you’ll be entitled to claim a Jersey old age pension.
If you work and pay social security contributions in Jersey for less than 4.5 years, you may be entitled to a Jersey old age pension if you’ve worked and paid sufficient contributions, in a
country that we have an agreement with.
Your pension is taxable, so you must declare how much pension you receive on your Jersey tax return each year. Find out how your pension works.
Private / workplace pension
It is not law for employers to pay into a private pension in Jersey, but many companies do have work pension schemes.
If you’ve paid into a private / work pension before moving to Jersey, you may be able to transfer this pension to another pension provider. Your workplace should be able to advise you on your options.