New law to exempt funds from income tax
Tuesday 7th September 2010, 3:00PM BST.
Treasury Minister Philip Ozouf.
A TAX law change to exempt some classes of funds from income tax will be included in the Budget in December, to bring the Island into line with Guernsey and other competing jurisdictions.
The amendment to the income tax law will exempt profits of eligible funds, their subsidiary companies and securitisation vehicles from income tax.
It is unusual for tax law amendments to be publicly highlighted before the Budget but Treasury Minister Philip Ozouf said that he wanted to get the message out there that the law would be changed as soon as possible.
Read the full story in the Jersey Evening Post.
Click here for subscription details.
Individual editions are also available online.
The Queen's Diamond Jubilee
JEP Jubilee Editions
Saturday 2 June: Guide to Celebrations
Wednesday 6 June: Souvenir of Events
View The Queen in Jersey supplement
Travel
To, from and around the Island
Airport Arrivals/Departures
Harbours Arrivals/Departures
Bus Information/Timetables
This is Jersey
Jersey Evening Post
Useful links
Being a bit of grease monkey, and not too familiar with the complexities of finance, could someone explain this to me.
As I understand the above, it will exempt the luckier, wealthier people ( those able to have ‘funds’ with profits ) the burden of taxation on the dividends the said funds yield annually.
So tax rules can be changed as and when. Is this the same set of rules that stated it would be unfair to re-negotiate with the 1(1)k residents a higher donation to help the Islands in these times of cuts and recession?
But wait a minute, I see! They can adjust tax rules to benefit the wealthy, but would not dare adjust a law which will be a detriment to the privileged!
See I worked it out on my own after all. Back to the grease . . . !
Report abuse
Mistershifter – your comments are not only very amusing but also spot-on !
Report abuse
It sounds unfair. What will the cost be to our revenue?
Report abuse
Why exempt anybody? Please explain, if able dear Treasury Minister Philip Ozouf!
No vote from me until you do.
Report abuse
This is a very good decision. The key here is that if they do not exempt certain funds, then these will up and leave, taking hundreds of jobs if not thousands.
Any locals who invest in a tax exempt fund will still pay tax onthe distributions, it is only for foreigners investing in the funds.
This makes sense if as a result of finance coming to the shores, then this creates thousands of jobs in the finance industry, and as a result the individuals working on these funds pay tax (indirect fund taxation).
So don’t fret, and let the classic naysayers jump up and down abotu this, because it is a straight forward and sensible decision.
The likes of truthseeker will jump on here soon wishing away these htousands of jobs – but don’t listen to these people please, they are Trotskyists of the worst order.
Report abuse
This isn’t going to impact on States revenue at all – contrary to what those above may think, funds aren’t currently taxed in Jersey and shouldn’t really be taxed anywhere as a point of principle. Why? Simple – people who invest in funds should always get taxed in their home jurisdiction on any money they make from their investment. If the fund itself is taxed, then they will effectively suffer tax twice on the same investment.
Therefore any people in Jersey who invest in a Jersey fund will still get taxed at 20% on any income they receive from the fund – why should they (or anyone else) pay extra tax for the privilege of investing in Jersey where they could invest in, for instance, a UK real estate investment trust fund (which doesn’t pay tax in the UK)?
The only reason that this is being done is to help build confidence in Jersey as a funds jurisdiction by putting the current international practice onto the statute book – although I can understand the attitude of those above who only had the information in the JEP article to go on and thought that the new law would change what currently happens. I hope this extra background will affect your opinions.
Report abuse
real truthseeker and Advocate X
I am disgusted that this website prints such fact-based comments when there must be lots of unsubstantiated opinion that could be published instead. Just because you are factually correct doesn’t mean you are right.
Down with the establishment!
Report abuse
It is simple – do not exempt these Funds and watch them move to IOM or Guernsey or exempt them and leave the resulting jobs in Jersey (and the income they generate for the tax coffers) – there Mr Grease Monkey – stick to your spanners.
Report abuse
Once again Mr Risoli you confirm why, contrary to your own opinion, you are not fit to be a States member…
Report abuse
9. Farmer Geddon. Couldn’t have put it better myself.
How can people continue to fail to understanding Jersey’s economic position.
Please wake up…….
Report abuse
SE – Thank you for that precise and informative explanation of the financial workings of a Tax Haven . . .
Think I will stick to hammers and spanners, cos as the saying goes ” Engineers will inherit the earth ” !
oh and not forgetting the grease. . . .
Report abuse
Pretty sure it was the meek….
Report abuse
mistershifter(11),” blessed are the lathe makers “
Report abuse
SE
‘Pretty sure it was the meek…’
Not many of those left in Jersey!
Report abuse
Ah small money, one good turn deserves another!
Yes SE the meek will inherit the earth. Bet they wont have a fund with profits . . . .
Report abuse
look, the rule is fairly simple.
If a fund is established in Jersey but makes no profits in Jersey, it doesn’t pay taxes in Jersey. The investors will pay taxes in their own country. If the investors are in Jersey, they will pay tax on the profits. But the fund itself pays no taxes in Jersey.
But the structure will keep lawyers, accountants, custodians and administrators in Jersey employed. And all of them pay for the roads and hospitals that the likes of mistershifter no doubt do understand.
Report abuse
I would like to point ut that it is the fund itself that will not pay income tax, the individual investor is still liable for income tax in their country of residence…
Report abuse
“It is unusual for tax law amendments to be publicly highlighted before the Budget but Treasury Minister Philip Ozouf said that he wanted to get the message out there that the law would be changed as soon as possible.”
No its not unusual.. it just goes unnoticed and unpublished. Yet another JEP sensationalist non story…
Report abuse
So I take it these funds are where he keeps his money then.
Report abuse