Jersey Tax Deductions 2025

Corporate Income Tax Deductions

• General Principle: In calculating taxable profits for Jersey corporate income tax purposes, companies can deduct expenses that are wholly and exclusively incurred for the purposes of the trade.
• Deductible Expenses:
  • Trading Expenses:Typical deductible trading expenses include salaries, rent, and other operational costs.
  • Interest Expenses: Deductibility of interest expenses is generally permitted, provided the borrowing is for business purposes.
  • Non-Deductible Expenses:
    • Expenses of a capital nature are generally not deductible but may qualify for capital allowances (depreciation).
  • Specific Deductions:
    • Legislation confirms that accounting fees are tax-deductible for businesses.
  • Group Relief: Jersey has group relief provisions that allow companies within the same group to offset losses against profits, subject to certain conditions.
  
  
  
  
  

  Individual Income Tax Deductions

  • Personal Allowances: Jersey operates a system of personal allowances, which reduce the amount of income subject to tax. These allowances vary depending on individual circumstances (e.g., marital status, children).
  • Specific Deductions:
    • Pension Contributions: Contributions to approved pension schemes are generally deductible.
    • Interest Relief: In some limited cases, relief may be available for interest payments.
  • Restrictions:
    • Deductions for personal expenses are generally not permitted.
  
  
  

  Important Considerations for Foreign Investors

  • Tax Treaties: Jersey has tax agreements with other countries, which may influence the availability of deductions for foreign investors to prevent double taxation.
  • Residency: An individual's tax residency status in Jersey significantly impacts their entitlement to personal income tax deductions.
  • Economic Substance: Companies must comply with Jersey's economic substance legislation, which, while not directly related to deductions, can affect the overall tax position of foreign investors.