Guernsey Finance

Legislation and details of Guernsey court cases are available online at Guernsey Legal Resources but here is a brief summary of the most significant recent developments:

Tax
Guernsey is currently reviewing its corporate tax regime. The current system - effective from the start of 2008 - introduced a zero rate of corporate tax as standard, in parallel with no withholding tax on dividends paid, no capital gains tax, no inheritance tax and no value added or general sales tax, and personal income tax still levied at a maximum of 20%. For more information visit the website of the Guernsey Income Tax Office, part of the Treasury and Resources Department.

Banking
Guernsey has a Depositor Compensation Scheme (DCS) for 'retail' depositors, whether Guernsey resident or non-resident. There is a compensation ceiling of £50,000 per account (£100,000 for joint accounts). For more information visit the Guernsey Banking Deposit Compensation Scheme website.

Funds
Guernsey has established a regime where both Guernsey open and closed-ended funds can be established as authorised or registered funds. Applications for registered funds are processed by the GFSC within a three working-day timeframe. Authorised funds remain subject to the traditional approval process unless they are established as Qualifying Investor Funds (QIFs) when again they are processed within three working days. In addition, a new fast-track procedure allows managers and general partners who need to be licensed under Guernsey law to service these (registered or QIF) funds to take advantage of a reduced application period of 10 working days. All timings are subject to meeting certain conditions.

Insurance
In 2008 Guernsey completed a thorough review and made several changes to maintain its tradition of having mature yet modern insurance legislation. Part of the changes regarded solvency requirements and effectively codified what was already best practice among Guernsey’s insurance managers – the minimum solvency required continues to be set out in the law but the board is required to make its own assessment, the ‘Own Solvency Capital Assessment’, which is provided to the regulator. The changes to the insurance law build on the risk-based approach that has been one of the Island’s hallmarks.

Fiduciary
A new Trust Law was came on-stream in 2008. Some of the most significant changes included the introduction of Purpose Trusts; the removal of limits on the length of a trust’s duration – allowing perpetual trusts; and the abolition of the personal liability of directors, particularly as a way to encourage greater use of Private Trust Companies (PTCs). Work continues on the introduction of Foundations.

Companies & IP
With a modern Company Law and cutting edge Company Registry, Guernsey is a leading jurisdiction for company formation. Combining the advantages of legislation written for the current and future commercial environment with the latest on-line technology, the Guernsey Registry is truly world class, while at the same time being small enough to offer the highest levels of personal customer service. The Registry also incorporates the Bailiwick of Guernsey's  Intellectual Property Office.