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Online News Sources
Jersey Evening Post: www.jerseyeveningpost.com
www.Thisisjersey.com
Business Environment
The main areas of business are banking, mutual funds, investment,
treasury, trust, administration, and insurance. Jersey is not part of
the European Union, but has a special relationship defined by a
protocol attached to the UK’s membership in the European Community.
Under the terms of the protocol, Jersey complies with EC directives in
the trade of industrial and agricultural products, but is not subject
to any directives or regulations, including those dealing with the
harmonisation of taxation, financial services, the exchange of
information or social policy. Proposed EU directives on tax
harmonisation seek to apply the regulations to dependent territories.
Under a proposed EU taxation of savings directive Jersey has agreed to
apply a withholding tax on the interest payments of savings held by EU
residents. The directive is expected to come into effect during 2005.
The OECD listed Jersey as among 35 jurisdictions that could face
punitive measures over ‘harmful tax competition’. Jersey signed a
letter in February 2002 committing to the OECD's proposals to exchange
information on civil and criminal tax investigations and was
subsequently taken off the tax haven blacklist (see the tax section
below). The G7's Financial Stability Forum rated Jersey a ‘group one’
offshore financial centre, i.e., deemed to be of ‘good quality’
supervision.
Companies may be classified as exempt companies or international
business companies upon application to the Registrar of Companies, an
office of the Jersey Financial Services Commission (FSC). Exempt
companies are non-resident for tax purposes, and are not taxed on
overseas income. All other companies are considered resident in Jersey.
No Jersey resident may have a beneficial interest in an exempt company,
unless indirectly through shares in a listed company that has a
beneficial interest in the company. They may directly hold up to 10% of
the shares if there are at least 10 people holding an interest in the
company. The international business company may be a Jersey company, an
overseas company controlled from the island and therefore resident in
the island, or the Jersey branch of a non-resident company.
International companies are considered resident for tax purposes and
are taxed at a rate between 0.5% to 2% on non-Jersey income.
The FSC keeps details of beneficial owners of all companies. All
companies must have a registered office and maintain a register of
members, directors, and a company secretary and other records in
Jersey. Directors and shareholders need not be resident in
Jersey. Private companies require a minimum of one director, but
a public company requires at least two. Residency is granted for
short-term contract workers.
The Companies (Amendment No. 6) (Jersey) Law 2002 came into force
on 1 September 2002 and introduced four new forms of companies and
provisions for permitting redomiciliation, or continuance, of companies
both in and out of Jersey. Until the amendment came into force, the
only type of company that could be incorporated in Jersey was a company
with par value share capital, whose members had limited liability
through holding shares. The amendment extends incorporation to
companies with no par value share capital, guarantee companies,
unlimited liability companies, and single member companies. The
legislation also alters the rules relating to the provision by a
company of financial assistance for the acquisition of its own shares.
Taxes
By 2008 Jersey’s government plans to phase in a new tax system
under which financial services companies will pay a 10% income tax and
all other companies will pay no tax at all. The decision to end the
difference between the taxation of offshore and domestic companies
stems from the need to meet the Organisation for Economic Cooperation
and Development and the European Union’s concerns over ‘harmful tax
competition’. Currently exempt companies registered in Jersey pay do
not pay income tax on overseas income while international companies pay
between 0-2%. Local companies pay the standard tax rate of 20% on
worldwide income.
Under the Income Tax Law all companies incorporated in Jersey are
regarded as resident companies. Any company incorporated outside Jersey
is regarded as resident in Jersey 'if its business is managed and
controlled' in Jersey, for example if board meetings are held in
Jersey. However companies can become tax exempt companies and be
treated as non-resident under the Income Tax law. An exempt company is
exempt from income tax on income arising outside Jersey (including
income received from another exempt company) and on interest credited
by banks and building societies operating in Jersey. Other income
arising in Jersey, such as rental income, is liable to income tax as
are the profits of a trade carried on through an 'established place of
business'. Business passing through an established place of business in
Jersey is taxed at the standard 20% corporate tax rate.
International business companies are considered resident for tax
purposes and are taxed at a rate between 0.5% to 2% on non-Jersey
income. International business companies are taxed 2% on the first £3
million of profits or gains, 1.5% on the next £1.5 million, 1% on the
next £5.5 million and 0.5% on sums above £10 million. Profits or gains
on Jersey-sourced income is charged at a 30% rate. The rate is to
enable certain companies to avoid controlled foreign companies tax.
Trusts for non-residents are exempt from tax on overseas income and on
bank deposit interest, and collective investment fund income arising in
Jersey.
Jersey funds are able to operate free of tax, apart from the exempt
company fee of £500 applicable to open-ended investment companies. In
terms of distributions from Jersey funds, income tax is not deducted
from distributions to investors who are resident in countries other
than Jersey. Double taxation treaties exist with Guernsey and the UK,
but Jersey tax-exempt funds do not benefit from these treaties.
Local companies pay the standard tax rate of 20%. There are no
taxes or duties on capital gains, gifts, estate, or inheritance. There
is no value-added tax but on 13 May 2005 the States of Jersey approved the introduction of a goods and services tax, scheduled for 2008
. There are no currency restrictions. Residents pay income tax of 20%.
Non-resident individuals do not pay income tax. There is no withholding
tax on interest or dividend payments for non-residents.
Stock Exchange
The Channel Islands’ Stock Exchange (CISX) was launched in Guernsey
in 1998 as a joint project with Jersey. The market capitalisation of
the CISX as at December 2004 was in excess of US $28 billion, covering
581 listed securities, of which a majority are open-ended funds. In
September, 2002, the US Securities and Exchange Commission awarded the
CISX designated offshore securities market status.
Key Contacts
Jersey Financial Services Commission
P.O. Box 267
St. Helier, Jersey
Channel Islands
JE4 8TP
Tel: (44) 1534 822000
Fax: (44) 1534 822001
E-mail: info@jerseyfsc.org
Internet: www.jerseyfsc.org
Channel Islands Stock Exchange
P.O. Box 623,
One Lefebvre Street,
St Peter Port,
Guernsey,
GY1 4PJ
Tel.(44 ) 1481 713831
Jersey
Tel. (44) 1534 737151
Key Stats
Country description: Bailiwick of Jersey or Jersey. Jersey along
with Guernsey make up the Channel Islands and are UK crown colonies or
dependencies. Jersey’s dependencies are the Ecrehous rocks and
Les Minquiers. The UK is responsible for defence and external
relations. Population: 90,812 (July 2005 est.,) of which 53% were
Jersey-born. The people of Guernsey are British citizens.
Capital: Saint Helier.
Currency: US$1 = £0.54 British pound (September 2005). The Jersey
pound is at par with the British pound. English money is freely
accepted.
Legal system: Based on British law and local statute. Jersey has a
Magistrate’s Court and a Royal Court. The baliff or his deputy presides
over the Royal Court. Final appeal is to the London Privy Council. UK
acts of parliament only apply to the island if it is expressly agreed
that they should do so.
Government: The head of state is the British monarch who is
represented by a lieutenant-governor. The 55-member legislative
assembly is the States of Jersey and is composed of elected deputies,
constables, and senators. The crown appointed bailiff and the deputy
bailiff and three non-voting members, (the Dean of Jersey, the
attorney-general and the solicitor general) also sit in the assembly.
The baliff is the president of the States of Jersey and is also the
island's top judge. The 29 deputies are elected in single- and
multi-seat constituencies. The 12 constables, or head of the parishes,
are elected by the parishes and sit in the States by virtue of their
position. The 12 senators are elected for a six year term, six of them
renewed every three years. Government is carried out through a
committee system.
Executive: Lieutenant-governor: Sir Michael Wilkes
Economy: The economy depends on finance, tourism, and agriculture
(dairy products). Finance is the mainstay, accounting for over 20% of
the Island’s workforce, and 50% of national income. Tourism accounts
for 24% of GDP. Jersey's financial institutions recorded total profits
of £1,050 million in 2003. Between 2002 and 2003 banking profits fell
by 6% whilst profits for funds and trusts grew by around 10%.
Gross domestic product (2001)
£2.9 billion (financial 55%, tourism 24%, investment 14%, agriculture
and fisheries 5%, light manufacturing 2%). Gross national income is
estimated at £1.9 billion.
Inflation rate (June 2004)
4.8% annual retail price index
Labour force (December 2003)
49,600 of which 6,370 work in the public sector. Unemployment: 677 persons.
Government accounts (2004)
Revenues of £452 million; current
expenditures of £408 million and £48 million in capital spending. The
total deficit is estimated at £4 million. Government's financial year
is the calendar year.
Public holidays (2005)
1 January (New Year); 25 March (Good
Friday); 28 March (Easter Monday); 2 May (May Day bank holiday); 9 May
(Liberation Day); 30 May (bank holiday);11 August (Battle of Flowers
Day); 29 August (summer bank holiday); 25 December (Christmas); 26-27
December (Christmas holidays).
Time zone
GMT. The clock goes forward one hour on the last Sunday in March and back one hour on the last Sunday in October.
Financial Year: 1 April – 31 March
Restaurant Guide
We recommend:
Bohemia
Green Street, St. Helier
Jersey
Tel. (44) 1534 880 588
Email: bohemia@huggler.com
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