Expat pensioners ‘should contact tax authorities’

Expat pensioners ‘should contact tax authorities’

A number of pensioners have contacted the JEP recently claiming they have lost thousands after the Non Residents Tax Scheme was dispensed with in 2016, effectively removing their entitlement to a personal allowance and other tax breaks under the marginal relief system.

In response, the Comptroller of Taxes Richard Summersgill has written to the JEP (see page 12) to advise overseas pensioners that they should contact their local authorities to claim tax credits if they are being ‘double-taxed’.

‘Most pensioners living overseas will not pay any more tax than they did before we ended allowances for non-residents in our 2016 Budget,’ the letter says.

‘Most tax authorities – and certainly those in Spain and Portugal – give their residents “tax credits” on Jersey-sourced income which will normally be equal to the tax paid in Jersey.

‘This means Jersey gets more tax; and Spain and Portugal, for example, get a bit less. Pensioners who live overseas can get advice from that country’s tax authority, or a tax adviser, to help them with this.’

The letter adds that the Taxes Office believes that fewer than 20 low-earning pensioners have been affected by the new regime.

Roger Bara, a former radio presenter who retired to North Cyprus, has set up a Facebook group called the Jersey Ex-Pats Association to represent those affected by the changes.

Mr Bara said that he believed Mr Summersgill’s letter had not addressed the issue many overseas retirees are facing which is that their overall tax bills have increased.

‘I don’t understand the letter. It’s not about double taxation – it’s about the fact that we lost marginal relief,’ he said.

‘It doesn’t matter whether we are getting a tax credit from where we live or not – the fact of the matter is that our tax bills have increased by tens of thousands. I think they are just trying to muddy the waters.

‘I am stepping up the campaign on this and have been speaking to the other overseas pensioners about this. They [the Taxes Office] are saying that there’s just a few of us affected by this but there are lots of us.’

He added: ‘I have seen some comments on social media saying that we were “naive” to retire abroad without knowing the tax consequences.

‘Well we weren’t naive – we knew the regime when we moved abroad but then it changed. If we had known this would happen a lot of us would have stayed in Jersey and downsized.’

Mr Bara said that he had written to all of the Members of the new States Assembly to highlight the issue.

‘We have received nothing but supportive and extremely supportive comments from them,’ he said. ‘We agree with paying tax on our work-provided pensions but we want our marginal relief back.’

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