Income tax relief if you are paying maintenance
In order to qualify for relief, the maintenance must be a periodical payment (not a lump sum or an instalment of a lump sum) and meet one of three requirements: It must be:
You must pay the amount specified in your written agreement or court order and not make any deductions before paying the recipient. The gross maintenance figure should be included on your income tax return; it will be taken into account when we calculate your bill.
You can claim tax relief on maintenance and alimony payments if you are permanently separated or divorced. However, you must have a written, legally-binding agreement in order for you to receive tax relief.
The amount of relief is the maintenance you have paid in the year, per the agreement, up to a maximum of £2,600 and is given as a deduction from your income at the marginal rate.
Maintenance agreements that qualify for tax relief
Tax relief for maintenance payments is only available for written, legally-binding agreements.
No relief is available for maintenance paid under a verbal or informal agreement.
Accepted maintenance agreements
We only accept agreements made under:
- the law of Jersey, or
- the law or courts of a member state of the European Communities
If an agreement falling within the above jurisdictions, has not been made under a court order it must still be legally binding and therefore:
- contain all the key factors such as amounts and purpose
- be signed and dated by the parties and witnessed
- be authenticated by an authorised body (eg a notary) in the country in which the agreement was made
We cannot give advice on how an agreement should be written, so if you are not sure about any issues in respect of drawing up an agreement you should seek professional advice.
If you are receiving maintenance payments
Agreements on or after 1997
You will not be taxed on maintenance payments where the agreement was made on or after 1 January 1997.
Agreements before 1997
If you are in receipt of maintenance where the agreement was made before 1997, it is taxable. However, it is capped at the amount that was due in 1997.