Guernsey, Channel Islands

Guernsey operates a flat 20% income tax rate for all individuals resident in Guernsey or deriving Guernsey-source income.

The 2023 Guernsey Budget introduced a number of changes in the field of personal taxation.

The personal allowance has been increased from 12,175 British pounds sterling (GBP) to GBP 13,025, and earners of more than GBP 90,000 will have their allowance reduced by GBP 1 for every GBP 5 exceeding this limit. This withdrawal of allowances has been extended beyond the personal allowance (see the Deductions section).

Interim assessments for individuals will now be issued prior to the commencement of the year of charge with instalment payments now due at the end of each calendar quarter (i.e. 31 March, 30 June, 30 September, and 31 December) rather than 30 June and 31 December. This is expected to come into effect from the 2023 year of charge.

Social security rates have been increased from 6.7% to 6.8% for the employer contribution and from 6.8% to 7.0% for the employee contribution. Self-employed contributions have been increased from 11.3% to 11.6%.  Lower earnings limits have been increased to GBP 163 (weekly) and GBP 706.33 (monthly), and upper earnings limits for both employer and employee have been increased to GBP 3,240 (weekly) and GBP 14,040 (monthly).

Couples are no longer subject to joint taxation, and each individual is now required to be responsible for their own taxes, including filing tax returns and making any payments due.

The Income Tax Law will be amended to close Section 157E pension schemes, and a penalty at the rate of 50% on unauthorised payments made from Guernsey pension schemes has been introduced.

Document duty will be charged at 0% on the first GBP 400,000 of a replacement principal private residence being purchased, subject to meeting certain conditions. This is expected to end on 31 December 2024.