JERSEY is now the odd man out of the three Crown dependencies, following this week’s signing of a Tax Information Exchange Agreement between Guernsey and the UK Treasury.
The UK already has a tax agreement with the Isle of Man, the British Virgin Islands and Bermuda. The TIEA is basically a sign of co-operation between two individual countries which commit themselves to exchanging tax information, on request. The idea was sanctioned by the OECD several years ago to improve cross-border tax transparency and has been heralded by offshore jurisdictions as an indication of good will in tax matters.
The Guernsey agreement was signed in London on Tuesday and includes a clause which means that pensions will be taxed in the jurisdiction where the pensioner lives, rather than where the pension is being paid out.
Crown dependencies minister Lord Bach, who signed the agreement with Guernsey’s Chief Minister Lyndon Trott, said it showed ‘the collaborative nature of the relationship between the UK and Guernsey, and Guernsey’s commitment to high international standards’.
• Picture: Shake on it: Lord Bach and Guernsey Chief Minister Lyndon Trott at the TIEA signing on Tuesday