Doing business in Jersey

Introduction

Jersey, officially the Bailiwick of Jersey, is a British Crown Dependency located between the northern coast of France and the southern coast of England. Jersey is a self-governing parliamentary democracy under a constitutional monarchy. It has its own financial, legal and judicial systems.

Jersey is a financial centre which attracts foreign investors who want to reduce their tax burden.

Corporate tax

Resident companies are subject to corporate income tax on their worldwide income. Remarkably, Jersey applies a corporate tax rate of 0% to companies. Only in specific cases, companies are subject to effective corporate income tax rates. A corporate tax rate of 20% applies to (1) utility companies, (2) income and development profits from Jersey real property, and (3) profits realised on the importation and supply of hydrocarbon oil. Financial services companies such as banks are taxed at 10%.

Conclusion

Jersey is an attractive choice to live and conduct business because of the low corporate and personal taxes, the lack of capital gains tax and inheritance tax, proximity to the UK and Europe, and the use of English as an official language.

A special tax regime applies to wealthy immigrants: newcomers are subject to 20% tax on the first GBP 625,000 of their income (which equals a tax burden of GBP 125,000 for a personal income of GBP 625,000) and to 1% tax on all income exceeding the threshold of GBP 625,000. This 1% tax rate does not apply to income originating from Jersey real property, as this is always taxed at 20%.

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