Payment of 2019 tax liability regulations scrutinised

22nd March 2021

​Changes to the proposed income tax regulations have been recommended by the Corporate Services Scrutiny Panel (CSSP) in their latest report, which sought to understand the impact of 2019 liability payment terms on taxpayers and public finances following the decision to move all Prior Year Basis personal taxpayers onto a Current Year Basis from 2020. 

A key failing of the regulations is the lack of recognition that the 2019 liability imposes added pressure and concern amongst couples who are seeking divorce or civil partnership dissolution. The husband or ‘Spouse A’ would be left liable for the payment of 2019 liability following a divorce or dissolution and it remains unclear as to how this will be split when independent taxation is brought into force or if a couple divorce before it is implemented.

The Panel’s report also found that the proposed regulations for deferred 2019 liability have been significantly revised since October last year. Whilst the extended period of payment liability over 20 years makes payment more manageable for taxpayers, it will have a significant impact on the management of Government expenditure and increases the risk that some of the due amount will not be recoverable.

Alongside several recommendations, the Panel will propose two amendments to the Minister for Treasury and Resources’ regulations, which will be brought to the States Assembly for approval during this week’s States Meeting, starting tomorrow, Tuesday, 23 March. The first amendment asks that 2019 liability collections are reviewed in 10 years and the second amendment seeks to adjust part of the regulations which do not recognise that a taxpayer unable to pay the 2019 liability twelve months after reaching pensionable age, may have already made payments towards the liability.

Senator Kristina Moore, Chair of the Corporate Services Scrutiny Panel, said “Whilst the revised proposals address many of the concerns expressed by taxpayers in focus groups, there are many ways the regulations could be clarified to assist taxpayers. The Panel has significant concerns about the manpower and systems in place to support delivery and Revenue Jersey has not adequately budgeted for the cost of implementing these changes. We urge the Minister for Treasury and Resources to reflect on our recommendations and incorporate our amendments into the regulations as soon as is feasible.”

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