Last Monday, representatives of the governments of Jersey, Guernsey and the Isle of Man signed the new agreements that significantly improve and modernise the Crown Dependencies` DTAs with Britain. These DTAs comply with new international tax standards, which are largely in line with the OECD Model Tax Agreement, and cover several of the Base Erosion and Profit Shifting (beps) measures. A natural person, alone or mainly resident, is subject to his or her worldwide income, with allowances, reductions and deductions (including double tax reductions). Employer contributions of 6.6% of gross salary are capped at GBP 823.68 per month. Reciprocal agreements with certain jurisdictions allow a temporarily seconded person to continue to pay contributions in his or her country of origin. The new double taxation agreements with Great Britain have been saved The convention explicitly excludes dividends and interest on bonds from its provisions. Guernsey also signed a Tax and Information Agreement (TIEA) with the United Kingdom and agreed to amend the provisions of the 1952 Agreement to add provisions on the taxation of pension income and an agreement procedure. There are also mutual agreement procedures in which a taxpayer considers that the actions of one or both territories give rise to a tax result that does not comply with the DBA. The tax authorities will endeavour to resolve this issue through mutual agreement and consultation. In the absence of such an agreement, the taxable person may request that the case be submitted to arbitration, the outcome of which would be binding on both territories.
Guernsey has signed Tax Information Exchange Agreements (TIEAs) with 60 jurisdictions and comprehensive double taxation agreements (DTAs) with Cyprus, Hong Kong, the Isle of Man, Jersey, Liechtenstein, Luxembourg, Malta, Mauritius, Monaco, Qatar, Seychelles, Singapore and the United Kingdom. Taxes paid in these jurisdictions, with the exception of those paid on dividends or interest on bonds, are permitted as an account of Guernsey income tax payable. Guernsey has double taxation treaties with a number of countries that provide either for tax exemptions in one country or for exemption from double taxation by credit. In addition, Guernsey partially brought into force double taxation treaties with the following provisions: as early as the 1950s, the original double taxation agreements (“DTAs”) entered into force between the United Kingdom and the Crown Dependencies, which have remained largely the same since then. . . .