Changes To Guernsey's Corporate Tax Residence Rules

Guernsey's rules on corporate tax residence changed at the beginning of 2019 following amendments to its existing tax law brought into effect by a combination of the Income Tax (Guernsey) (Amendment) (No 2) Ordinance 2018, the Income Tax (Substance Requirements) (Implementation) Regulations, 2018 and the Income Tax (Substance Requirements) (Implementation) (Amendment) Regulations, 2018, all passed in December last year.

Prior to these changes, a company was resident for tax purposes in Guernsey if it was either incorporated in Guernsey and had not been granted tax-exempt status, or was 'controlled' in Guernsey. The concept of 'control' looked broadly at whether the company's affairs were conducted in accordance with the wishes of its shareholders or loan creditors who were resident in Guernsey themselves.