THE Treasury Minister has given around 26,000 taxpayers more time to pay off tax bills that were frozen in 2019, in a bid to help some Islanders with the rising cost of living.
Taxpayers now have until 2027 to start making payments, and until 2043 to pay off the full amount, Deputy Elaine Millar has announced.
Deputy Millar said: “This decision provides affected Islanders with more breathing room to navigate their financial commitments effectively.”
In 2020, the States abolished the Prior Year Basis (PYB) tax system — which required Islanders to pay their tax for the previous year in arrears.
This move aimed to keep more money in the pockets of self-employed and employed individuals.
Under the previous system, if a taxpayer’s circumstances changed and their income reduced, it could become difficult for them to pay a prior-year’s bill on a current year’s income.
Around £330 million in 2019 tax liabilities were frozen for future repayment, affecting approximately 31,300 taxpayers.
Since then, over 5,000 taxpayers have settled the outstanding bill.
The States introduced a payment scheme in 2021, originally set to start in 2025. This plan involved taxpayers paying a small portion of their frozen 2019 tax liability each year, starting from 2025 until 2041. For most people, this would have been less than £35 per month.
The recent announcement gives taxpayers more time to start paying.
Additionally, those who reach pensionable age can choose to pay the full amount within 12 months of reaching that milestone. The deadline for making this decision has also been extended to 2026.
