Source: Guernsey Financial Services Commission
The States of Guernsey Annual Budget was published on Monday 16 November 2020 and can be found here.
Within the Annual Budget it is proposed to make a change in respect of Gratuity Schemes and their treatment under section 40(nn) of the Income Tax (Guernsey) Law, 1975. The proposal would make a technical change to the exemption under section 40(nn) of the Income Tax (Guernsey) Law, 1975 to include income paid from an international savings plan as being exempt from tax.
The Annual Budget describes international savings plans as savings plans aimed at benefitting employees of multinational and international companies. Such plans must have for their sole purpose the provision of benefits in respect of the persons’ employment wholly outside Guernsey in a trade or undertaking. They must be established under the law of Guernsey and must also be administered by fiduciary licensees subject to regulation by the Guernsey Financial Services Commission.
Fiduciary Licensees should be aware that, if successful, the proposal to amend section 40(nn) of the Income Tax (Guernsey) Law, 1975 to exempt income paid from international savings plans will also require an amendment to the definition of gratuity scheme within section 2(1)(e) of the Regulation of Fiduciaries, Administration Businesses and Company Directors, etc (Bailiwick of Guernsey) Law, 2000 covering the regulated activity of the formation, management and administration of gratuity schemes.