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Guernsey Signs Tax Information
Exchange Agreements with UK
The Official Guernsey Government Website, Jan., 2009
Guernsey Chief Minister Lyndon
Trott in January, 2009, signed an agreement with the United Kingdom that
will modify existing double taxation rules. This means that in the near
future pensions, other than those for government service, will be taxed in
the jurisdiction (UK or Guernsey) where the pensioner lives, and not where
the pension is paid from.
Deputy Trott said: ‘The new
agreement will bring tangible benefits for residents of Guernsey. When the
new provisions are in place, the revision to the Double Tax Agreement (DTA)
between the UK and Guernsey means that many Guernsey residents who have
not previously been able to take advantage of transfer arrangements for
pensions that apply in the UK will be entitled to relief from UK tax.
Pensions, other than those for government service, paid from the UK to
residents of Guernsey will only be taxed in Guernsey and not in the UK.
Not only is this good for people with pensions, both now and in the
future, it also means that Guernsey’s tax collections benefit, meaning
that revenue will increase as well.’
It has been estimated that the
additional tax payable to Guernsey could increase by as much as £3m per
year. This is one benefit of the package of agreements that was signed in
London today, which includes a Tax Information Exchange Agreement (known
as a TIEA). In addition to providing economic benefits for Guernsey
residents, the package that was agreed also means that the UK and Guernsey
will, on request, exchange bank and other information relating to both
criminal and civil tax matters. This will provide a further demonstration
of Guernsey’s transparency and robustness as an international finance
centre.
Deputy Trott said: ‘In addition
to these benefits for Guernsey residents, the agreement will also provide
relief from double taxation in other areas, and one of the other benefits
of this is that Guernsey will also become more attractive for inward
investment from other countries.
‘This is a real win-win for
Guernsey – a win for the hard-working people and pensioners of Guernsey,
and a win for our position as a leading international financial centre.’
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