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Tax Capping for Guernsey Residents

It is possible to cap exposure to income tax in Guernsey as an alternative to paying a flat rate of 20%, after personal allowances and deductions.

The maximum tax liability for any individual who does not have Guernsey source income is £150,000 per annum.

For those who have both Guernsey and non-Guernsey source income, (Guernsey bank interest does not count as Guernsey source income) the maximum tax liability is £300,000 per annum, although tax is payable on income arising from Guernsey land or buildings in addition to the cap amount.

It is also possible to cap the non-Guernsey source income at £150,000 and pay 20% on any Guernsey source income if this is beneficial.

With effect from 1 January 2018, a tax cap of £50,000 per annum is available for individuals for their first four years of residence subject to the conditions listed below.

An individual must:

  • Be resident in Guernsey
  • Pay £50,000 or more in document duty for the purchase of an Open Market property purchased on or after 1 January 2018. At the current rates this equates to duty payable on a property purchase of £1.4 million or more

  • Make the purchase either 12 months before or after the date of taking up residence in Guernsey.

The £50,000 cap covers the tax due on both overseas and Guernsey income, except for income from Guernsey land and buildings, which remains taxable at 20%, in addition to the tax cap paid.

Foreign and worldwide tax caps are not limited in duration and are applicable no matter how many years the individual has been solely or principally resident in Guernsey.

The information on this web page is provided as a general guide and does not constitute professional tax advice.  Further detailed information can also be found on the website of the Guernsey Revenue Service. 

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