Channel Islands: Annual tax reporting for partnerships (Jersey)
Following the introduction of economic substance rules for partnerships effective for the 2022 tax year
Following the introduction of economic substance rules for partnerships effective for the 2022 tax year, the Parliament approved new annual tax reporting for partnerships.
Registration of partnerships
Historically, very few partnerships were required to register with Revenue Jersey. Now each of the following partnerships will be required to complete some annual tax reporting in Jersey:
- Formed/incorporated in Jersey
- Place of effective management in Jersey
- Earns profits and gains that result in one or more partners having an obligation to submit a Jersey tax return (for example, where a partnership is undertaking trading activities in the Island)
- Required to provide information on its economic substance position
Partnerships that are already registered with the Jersey Financial Services Commission (JFSC) will be automatically registered with Revenue Jersey, and those partnerships may have already received “Tax Registration” notices.
For partnerships with a reporting obligation that are not registered with the JFSC, there is a requirement to register with Revenue Jersey (through an online form). This likely will be most relevant in the context of non-Jersey established limited partnerships that have their general partner based in Jersey. To complete the registration form the partnership will need to provide details of where it was established, its activities and the nomination of a responsible partner.
The obligation to discharge the annual tax reporting needs to fall on a person who can be contacted through an address in Jersey—the “responsible partner.” Any penalties for non-compliance with the annual tax reporting obligations will fall on the responsible partner rather than the partnership more generally.
Another on-line form has been created to allow partnerships to nominate their responsible partner. To the extent that a partnership does not nominate a responsible partner, Revenue Jersey will determine the responsible partner (note that limited partners are precluded from being a responsible partner).
Partnership combined notification
The actual annual tax reporting will then take the form of the “partnership combined notification,” which must be filed by 30 November in the year following the tax year, subject to late filing penalties. The first partnership combined notification will need to be filed by 30 November 2023 in respect of the partnership’s activities during the 2022 tax year.
Consistent with the Jersey corporate tax return, the amount of information that needs to be provided in the partnership combined notification will depend on the partnership’s activities (e.g., if the partnership is in the scope of the economic substance requirements, it will need to provide information relevant to how it meets those requirements).
Read a January 2023 report prepared by the KPMG member firm in the Crown Dependencies
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