Tax liability of a non-resident
If you are not resident in Jersey during the calendar year, you are chargeable to income tax at the standard rate of 20p in every £1, without being granted any allowances. You may however wish to claim non-resident relief, where a proportion of reliefs may be granted.
How is non-resident relief calculated?
You need to complete a non-resident return and you must declare your gross worldwide income (before tax) for the calendar year. If you are married or in a civil partnership we need both your incomes. You are not charged on the income arising outside of Jersey, but it is required in order to work out the relief you are due.
To calculate non-resident relief, we follow these steps:
- we work out the tax on your worldwide income, giving any reliefs or allowances you would be entitled to receive if you were resident
- we work out the tax on your Jersey income without any allowances (Jersey income at 20p in every £1)
- we take your Jersey income over your worldwide income and multiply it by the result of step 1. This gives us the tax due with non-resident relief
- your tax will be the result of either step 2 or 3 (whichever is lower)
The following example applies to a single person in 2015 with Jersey property income (after expenses) of £15,000. They also have non-Jersey income of £10,000.
- calculation on worldwide income: £25,000 less the single exemption threshold (£14,200) = £10,800 @ the marginal rate (26%) = £2,808
- tax due on Jersey income £15,000 without non-resident relief @ 20p = £3,000
- (£15,000 ÷ £25,000) × £2,808 = £1,684.80
- £1,684.80 is therefore the tax due. Non-resident relief is the difference between this figure and the result of step 2 (£1,315.20)
Withdrawal of non-resident relief
With effect from the year of assessment 2016, you will no longer be able to claim non-resident relief.
This means that any non-exempt Jersey income will be taxed at 20%. The tax due in the example above will be £3,000.