In August 2020, Jersey’s Treasury and Resource Minister announced a proposal to move all Jersey taxpayers to Current Year Basis (“CYB”).
The intention to move all islanders onto CYB was announced in last year’s Government plan, but this has been accelerated due to the impact of COVID-19.
On 4 November 2020, the States of Jersey approved the amendment to the Income Tax Law. It means that Revenue Jersey will be able to move Prior Year Basis (PYB) taxpayers to the CYB.
How this will actually happen is yet to be formally decided [various methods have been discussed or shared], but there are important points to note and consider right now.
The vote on 4 November means that taxpayers who pay their tax on account, so not primarily through ITIS payments, no longer need to make the payment on account due at the end of this month, unless they wish to do so.
Any payments that may have already been made earlier this year in relation to 2019 tax liabilities by all PYB taxpayers will be automatically transferred by Revenue Jersey and offset against the 2020 tax liability.
The 2019 tax liability is now frozen until further notice.
We expect the draft regulations to be published early next year and when the States of Jersey share their plans for how they intend to move PYB taxpayers to CYB basis, we will advise on the options available for paying the 2019 liability.
It is important however to note and remember that your overall tax liability
has not been reduced.
The amendment to the Income Tax Law only means that the allocation of payments has changed. For those taxpayers currently paying their tax on a CYB basis, there is no change to how you pay.
We will remain in contact with Revenue Jersey and we will keep you fully informed of the developments as they arise.
If however you have any concerns, please do not hesitate to get in touch with our tax team:
John Shenton | Director
T: 01534 885 866
Lisa Guy | Director
T: 01534 885 735
Andy Shaw | Senior Manager
T: 01534 885 704
James Tinnelly | Senior Manager
T: 01534 885 780
Kimberley Godinho | Manager
T: 01534 885 783