Calculating your tax (yearly tax assessment)

Calculation of income tax

Your yearly tax is calculated based on your total taxable income in the year, less any deductions you can claim. There is also an exemption threshold where you don't pay tax if your income is below the threshold.

You pay tax at the lower of two calculations:

• the standard rate calculation
  
• the marginal rate calculation
  

Standard rate calculation

The standard rate of tax in Jersey is 20%. This is the maximum personal income tax you will pay in a year. 

Exemption thresholds

To protect people on low incomes there are tax exemption thresholds. If your income is below the exemption threshold you don't pay income tax.

Extra tax reliefs 

Your exemption threshold may also be increased by the following:

• second earners relief
  
• deduction for children
  
• additional allowance for children
  
• child day care relief
  
• marginal income deduction for interest payments on your home (until 2025)
  

Allowances, reliefs and deductions for income tax

Marginal rate calculation

If you have a low income, but it's more than the exemption threshold, you'll pay some tax but it won't be at the maximum rate. Instead we use a calculation so that you pay a gradually increasing amount of tax as your income goes up.

This calculation uses the exemption thresholds and a marginal percentage rate of 26%.

Marginal relief explained

Your tax assessment

If you are liable to Jersey tax you'll receive a tax assessment showing how your tax has been worked out.

It will include:

• a breakdown of all your income which is liable to tax in Jersey
• any expenses you are entitled to claim against that income
• any allowable pension contributions
• the tax at the standard rate
• marginal relief calculation (if any)
  
• the tax you have been charged
  
• your long-term care contribution