The compulsory payments will start in January and will involve a monthly sum being automatically deducted from everyone’s pay packet.
People will still be expected, as normal, to fill in self-assessment forms but instead of receiving a bill in September, people will be informed whether their monthly instalments will meet, or fall short, of the overall bill.
Any discrepancies will be calculated into the following year’s instalments.
This year’s tax bills, for 2004, still need to be paid by 9 December in order to avoid the ten per cent surcharge penalty.
But this year will be the last time that people pay a one-off lump sum for their tax bill.
The amount an individual will pay per month is calculated on how much they paid for their tax two years previously, so next year’s payments will be based on 2004’s bill.
Over the next three weeks, Islanders will be sent a statement from the tax office explaining how much they will be deducted, starting from January.
Anyone who wishes to challenge the amount they have to pay can appeal with the department, which is to extend its opening hours to deal with the anticipated throng of people.
Comptroller of the Income Tax Department Malcolm Campbell said: ‘This is not a pay as you earn system, but in effect a forced savings scheme.
However, I want to end one rumour and confirm that people will not have to pay two years’ tax next year.
As long as everyone pays last year’s tax bill on time then there will not be a problem, but instead of people saving next year, they will be paying their bill in instalments.’
