Taxation In Jersey - Exempt Companies

The exempt company is regarded for all purposes of the Income Tax Law as not resident in Jersey, although it may be regarded as Jersey resident by other countries for their own taxation purposes. The company pays an annual fee of £500 irrespective of the level of its profits. Any Jersey source income, with the exception of Jersey bank interest for which a concessionary exemption exists, is liable to income tax at the standard rate of 20%.

Trading income is exempt from Jersey income tax except where the trade is carried on through an established place of business in the Island. Having Jersey resident directors holding board meetings and entering into contracts in the Island (i.e., effectively controlling the company) is not considered to be trading for this purpose if no physical presence exists on the Island. In addition, clerical functions such as invoicing operations are not regarded as the carrying on of a trade.