Personal income tax amendments
Income tax exemption thresholds
The exemption threshold limits for the year of assessment 2014 to be increased by 1.5%.
2014 tax allowances and reliefs
Decrease in the marginal rate
The marginal rate of tax to be decreased from 27% to 26%.
Marginal relief calculation of personal tax
Enhanced exemption threshold for parents of children in higher education
An additional £3,000 to be added to the higher child allowance of £6,000 for individuals in the marginal tax bracket.
Claiming tax relief for your dependent child
Remove the restriction to child allowance by reference to the child's earned income
No account to be taken of a child's earned income for the purposes of calculating child allowance. (Any other income will still be included eg investment income.)
Changes to the enhanced exemption thresholds for 2014
The single, married person’s and civil partnership enhanced exemption thresholds will only apply for those aged 65 and over. There will be ‘grandfathering’ provisions for those who are 64 during 2013, so that these individuals will remain protected and continue to benefit from the enhanced allowance.
High net worth individuals - 1(1)K's
High net worth individuals who were granted residency before July 2011 to be allowed to elect into the new regime. Consideration will only be given to applications that demonstrate an identifiable economic benefit to the Island.
Taxation in Jersey
Lump sum donations
Remove the 3 year rule of residence required to make charitable lump sum donations. The donor will now only need to be resident in Jersey when the donation is made.
An amendment was also accepted reducing the minimum donation from £100 to £50.
Making lump sum donations to Jersey
Income Tax Instalment Scheme (ITIS)
Amend the ITIS provisions to restrict the credit to controlling directors, ensuring that if the ITIS deduction made from their fees is not paid, credit is not given on their personal account.
Mandatory online filing for ITIS
Introduce mandatory online filing for ITIS during 2014 as part of our commitment to e-government. The taxes office may allow certain organisations or very small employers to continue to file paper returns, but these will be the only exception.
Corporate tax amendments
Strengthen legislation on interest deductions to counter non commercial debt financing
This concerns loans for:
- commercial lettings
- machinery and plant
- acquisition of a trade
- acquisition of a partnership share
- acquisition of a trading company
Where the amount of a loan or the interest charged exceeds what the lender could reasonably be expected to lend or charge on a commercial basis the Comptroller will determine the amount of interest that is eligible for relief.
Revise the relief due to the self employed in respect of social security contributions
This reflects the changes in the social security law to ensure the correct tax relief is available to self employed individuals.
Amend the distribution rules
Amends some of the distribution rules introduced in the 2013 budget to ensure they operate as intended.
Create a level playing field for oil importation and distribution companies
Some companies import and supply oil through one entity then some split their activities and some undertake either importation or supply. The current law discriminates between these various operations, which was never the intention. This minor change will ensure a level playing field for all.
Goods and Services Tax (GST) amendments
Clarify the definition of an 'existing building'
There is no explicit definition of an existing building in the GST legislation. This proposal introduces a definition to ensure that only constructions of new dwellings from the ground will be eligible for the 0% rate.
A two year grandfathering provision is included to allow for constructions works that are in progress on 1 January 2014 but which do not meet the new legal definition.
Clarify the position regarding white, and other removable goods supplied in zero rate dwellings
This puts the existing policy, that requires developers of new dwellings to account for GST on the sale of any 'white goods' and other removable items commonly supplied in new residential units, into legislation.
Correct the de-registration law
This will allow the Comptroller, taxpayers and agents greater flexibility in agreeing a date from which GST de-registration should apply.
Imported goods put to private use on de-registration
This will align the treatment of goods that have been imported by a Customs approved trader with those that have been sourced in Jersey to ensure both categories of goods are considered when applying the provisions that exist to a GST charge.
Provide a discretionary power to the Comptroller for input tax claims
This will give the Comptroller a limited discretionary power to allow, upon application, input tax claims that would otherwise be capped by the current 3 year time limit.
Land Transaction Tax (LTT)
First time buyers
The extension to the upper property value for first-time buyers from £400,000 to £450,000 was introduced as a temporary measure in the 2012 budget and then extended in the last budget. This will now be further extended to 31 December 2014.
Calculating your land transaction tax
Repeal £20 credit for filing online
This will ensure that from 1 January 2014 no credit will be available for taxpayers filing online. Online filing for individual taxpayers will still be introduced in the near future, but it is now considered that a £20 incentive for filing online is too generous and will cost too much.