About land transaction tax
Land transaction tax (LTT) is a form of duty on share transfer transactions where the shares 'confer a right of occupation of land in Jersey'.
The definition of land in for these purposes is a 'unit of dwelling accommodation'.
There are charges for:
- a transfer of ownership
- a declaration that a share is held on trust for the benefit of a person or changing the person for whose benefit the share is held
- taking out a security interest agreement against the shares
Who pays land transaction tax
LTT is paid by:
- the person who buys shares in the company and those shares give the right of occupation to the property
- the beneficiary of a trust that purchases the shares of a company and those shares give the right of occupation to the property
- a person that is substituted for another person as a beneficiary of a trust, where the trust holds the shares of a company and those shares give the right of occupation to the property
- a secured party who has created a secured interest on the shares under a security agreement eg where a mortgage has been taken to finance the purchase of the shares
'Right of occupation' relates to the terms in the articles of association of the company. It has no connection to housing qualifications or residency. If the articles confer a 'right of occupation' then land transaction tax is due, whether or not actual occupation takes place.
Transfer of ownership charges
LTT is calculated on the market value of the shares purchased. The rate of duty varies depending on the value of the transaction and whether or not you are a first-time buyer.
Security interest charges
This charge will apply if you take out a security interest agreement (ie a secured loan) in respect of the shares in the company. There is a reduced rate for 'lower value' residential properties.
Calculating the charge
You can work out how much LTT is due on either a transfer of ownership or a security interest agreement on the 'Calculating your land transaction tax' page.
Calculating your land transaction tax
To pay the tax due on the transfer of shares or on the creation of a security interest you will need to fill out the required form. The forms can be downloaded and information about completing them can be found on the 'Completing land transaction tax forms' page.
Completing land transaction tax forms
Paying land transaction tax
Two copies of the completed forms, together with payment payable to the 'Treasurer of the States' for the tax due, by post or in person to the cashiers at Customer and Local Services.
The cashier will keep one copy and return the other, stamped, with an official receipt for you to pass to the company secretary.
You need to provide this together with any other documentation required in order that the shares may be transferred into your ownership.
The LTT is due within 28 days following the date of the transaction. If the duty is not paid within this time limit, a surcharge of 10% will be charged. LTT can be paid in advance of the transaction.
If the consideration is made in any currency other than sterling the value of the transaction shall be the equivalent value in sterling. You will need to obtain a certificate signed by an officer of a bank in Jersey showing the rate of exchange prevailing on the day of the transaction.
The company secretary
The duty of a company secretary in respect of land transaction tax
A company secretary cannot transfer the shares into the new owners name without having the LTT receipt or a certified copy.
Failure to comply with this regulation is an offence under Article 42 of the Companies (Jersey) Law 1991 and could result in the company being subject to a fine at level 3 on the standard scale.
Errors, appeals and penalties
I have made an error when calculating the LTT
You must bring the error to the attention of the Comptroller without delay with your revised calculations. Any overpaid LTT will be refunded. If you have underpaid you will need to pay the additional duty and may also be subject to a surcharge. You will be issued with a revised LTT receipt.
I have lost the LTT receipt
You may apply to the Comptroller to issue a replacement receipt if you have lost, destroyed or damaged your LTT receipt. A charge may be made.
The Comptrollers powers
The Comptroller may require a person to deliver a statement and supporting information in respect of any transaction to which the Land Transaction (Jersey) Law 2009 applies.
The Comptroller also has the power to make an assessment on a person if he believes they have not complied with the LTT Law or if he is of the opinion that the purpose of a transaction is the reduction or avoidance of the LTT.
Retention of records relating to LTT
You are required to retain records for a period of 6 years following the date of the transaction.
I need to complain or appeal
If you have a complaint about any aspect of the administration or application of LTT or the conduct of an income tax officer you should first contact the Comptroller.
If you are aggrieved by any decision of, or assessment made by, the Comptroller under the LTT Law you are entitled to appeal. Your appeal may be heard by the Commissioners of appeal who are an independent body and have the power to uphold or revoke an appeal or to vary any decision, or substitute their own direction as they see fit.
Commissioners of appeal
Failure to deliver a statement and pay the LTT is an offence. It is also an offence to deliver false or misleading information or aiding or conspiring with someone to deliver false or misleading information. The penalties for such offences are severe and could lead to imprisonment and fines.
Advice regarding land transaction tax
Your lawyer or conveyancer will be able to help you regarding the LTT amount to pay and completing the forms.