Jersey's High Earners Set To See Taxes Increase

by Phillip Morton, Investors Offshore.com

29 September 2008

The States of Jersey has reminded taxpayers in the jurisdiction that new tax legislation will mean that most high earners will pay more in income tax this year.

In December 2006 the States agreed to phase out certain tax allowances for taxpayers on higher incomes.

The legislation, known as ‘20% means 20%’ is aimed at increasing the tax on those who can afford to pay more. The 2007 Income Tax Notices of Assessment will be the first to reflect these changes.

Comptroller of Income Tax, Malcolm Campbell explained:

"2007 is the first year that 20% means 20%, which is aimed at raising the tax on higher earners, takes effect. Those taxpayers on higher incomes will see an increase in their tax bill due to the reduction in certain tax allowances and reliefs they can claim."

He continued:

"However, those who are in the lower to middle income bands, who are entitled to what is known as ‘Marginal Relief’ will benefit from a 2.5% increase in the exemption limits for 2007. In addition, they will still be entitled, in the calculation of Marginal Relief, to full interest tax relief on their mortgage and also wife’s earned income allowance if applicable."

"The Notices of Assessments that will be sent out in late September will be to those taxpayers who do not pay their income tax through ITIS."

"Taxpayers who do pay their income tax through ITIS deductions will receive their 2007 Income Tax Assessments in mid-November."

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