CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Guernsey's Zero-Ten Regime Endorsed

Guernsey's Zero-Ten Regime Endorsed

by Jason Gorringe,, London

13 September 2012

Guernsey has received confirmation from the European Union that, following the adoption of new income tax legislation, the island's 'zero-ten' corporate tax regime now complies with the European Union Code of Conduct on Business Taxation.

The Income Tax (Zero 10) (Deemed Distributions) (Repeal) (Guernsey) Ordinance, 2012, adopted by the island's legislative assembly in June, follows on from an assessment of the zero-ten tax regimes present in each of the three Crown Dependencies, which also include Jersey and the Isle of Man.

Guernsey was notified in April that its deemed distribution regime was also seen as 'harmful' and contrary to modern-day international standards in the area of business taxation, and was asked to repeal it, consistent with the findings and suggested remedies in the cases of the other two islands.

Under Guernsey's regime, a 'deemed distribution' is presumed by the government and individual income tax is liable on the amount irrespective of whether a distribution has in fact been disbursed to the company shareholder.

The island received confirmation during a meeting on September 10, 2012, that the Ordinance providing for the repeal of the regime from January 1, 2013, is satisfactory for the island's regime to be considered to be compliant with the EU Code of Conduct.

Welcoming the news, Guernsey’s Chief Minister, Deputy Peter Harwood, said: “Obviously this is subject to the standard ratification process but I am pleased that the EU Code Group confirmed that the repeal of our deemed distribution regime does indeed, as we expected, ensure our corporate tax regime conforms to the EU Code of Conduct.”

Fiona Le Poidevin, Chief Executive of Guernsey Finance - the international promotional agency for the island’s finance industry, added: “The deemed distribution provisions primarily affect locally resident shareholders and therefore it is very much a case of business as usual for the international client base of our finance industry."

“However, it is pleasing to hear that the Code Group has assessed our amended regime as Code Compliant. This shows Guernsey is a jurisdiction which is willing and able to move quickly to ensure it continues to meet international tax standards, while also retaining its position as an extremely competitive place to do business,” Le Poidevin concluded.

TAGS: Isle of Man | tax | investment | business | law | international financial centres (IFC) | corporation tax | Guernsey | Jersey | offshore | standards | individual income tax

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »