Concession and Practice: Personal tax 21 to 28

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P21: Pre 1997 maintenance payment increases

In the case of maintenance payments of less than £2,600 per annum made under orders or deeds dated on or before 31 December 1996 relief is capped for 1998 and later years at the level payable in 1997, as is the assessment on the recipient.

By concession, however, the cap will not be enforced except to limit the relief to £2,600 (or the amount paid, if lower). For example, if the amount payable is increased from £2,000 in 1997 to £3,000 in a later year, the relief will be increased to £2,600. The assessment on the recipient will nevertheless continue to be capped at the 1997 level, in this example £2,000.

Where an annuity is paid from a Jersey pension scheme or superannuation fund to a person resident outside the Island, tax must be deducted in accordance with the provisions of Article 87.

However, occupational pensions paid to Guernsey residents may be paid without deduction of tax if permission is sought from the Comptroller and evidence is produced that the pension will suffer Guernsey tax. 

P24: UK real estate investment trusts

By concession, Jersey resident individuals will be allowed to claim double tax credit relief against property income distributions arising from a U.K. real estate investment trust.

Stock dividends

From 1 January 2013 a stock dividend which falls within the definition outlined in Article 3 is not taxable in Jersey. The definition of a stock dividend is as follows:

1. share capital issued by a company in consequence of the exercise by any person of an option conferred on the person to receive, in respect of shares of the company, either cash or additional share capital
2. bonus share capital issued by a company in respect of shares in the company of a relevant class
   

For the period from 1 January 2009 to 31 December 2012, stock dividends were taxable in Jersey. Prior to 1 January 2009, stock dividends were not taxable in Jersey unless they were paid by a company which first became resident in Jersey, or which first had a permanent establishment in Jersey on or after 3 June 2008.

Dividend reinvestment schemes

In these types of arrangements (such as dividend reinvestment plan) the shareholder is entitled to a cash dividend, that cash dividend is then used to acquire further shares in the company.  The shareholder is liable to tax on the dividend irrespective of where the dividend arises and whether or not it is applied to acquire further shares.

An assessment will not be made on a person who is not resident in Jersey in respect of Jersey bank interest and a Jersey social security pension. However, if a non-resident relief claim is made in respect of other Jersey income, any Jersey bank interest and Social Security pension will be included in the computation as income subject to Jersey tax. If the computation results in a liability greater than the tax suffered by deduction and charged at the standard rate on other Jersey income, no action will be taken to collect the excess.

The concession in respect of Jersey bank interest is also extended to:

• a non-resident person entitled to interest from designated accounts
• trustees of trusts with non-resident beneficiaries
• the attorney executor of the estate of a deceased non-resident
• the executor of the estate of a deceased Jersey resident, to the extent that the income is payable to beneficiaries who are not resident in the Island

Tax position from the year of assessment 2009 onwards

Article 118B in the Income Tax Law provides for the exemption from income tax of the following sources of income arising to non-residents:

1. Jersey bank deposit interest
2. distributions made by a company regarded as resident in Jersey to the extent that such distributions were made out of profits or gains charged on the company at the rate of 0%
3. a Jersey Social Security pension
4. a purchased life annuity
5. interest paid by a company regarded as resident in Jersey
6. the profits and earnings of the office of director of a company
7. any royalty or other sum paid in respect of the user of a patent

P27: Notification of voluntary increases to your ITIS rate

P28: Accommodation benefit, repairs and capital improvements to property

We are prepared to consider, on a case by case basis, whether the costs of repairs and capital improvement met by the employee are deductible from any accommodation benefit.