Guernsey Exempt Companies:

Guernsey Exempt Private Company:

Private Limited Companies can obtain exempt status under the Income Tax (Exempt Bodies) (Guernsey) Ordinances 1989 and 1992, and they are known as Category D bodies. This legislation was created within the exempt regime that had already existed for some time for Unit Trusts and Investment Funds, see below.

Insurance companies and banks are also dealt with under separate legislation. Guernsey residents may not have direct shareholdings in Exempt Companies.

Exempt status must be applied for annually to the Administrator. Exempt Companies do not normally trade in the Bailiwick and must have declared local activity in previous years and paid tax on it; they must also disclose beneficial ownership to the Financial Services Commission.

There is an annual fee of GBP600 for exempt status, and there is also a fee of GBP100 payable when dealing with an Application for Exempt Status and filing the Annual Return (in duplicate).

Guernsey Exempt Investment Schemes:

Legislation came into force in 1984 (later amended in Income Tax (Exempt Bodies) (Guernsey) Ordinances 1989 and 1992) offering exempt status to Guernsey unit trusts and investment companies (Guernsey or otherwise, and including foreign limited partnerships). They are known as Category A, B or C bodies.

The main conditions are that Guernsey property or investments may not be held (other than bank accounts) and that a Guernsey resident must have been contracted to provide administrative services for an arm's-length fee; there are various information requirements.

The application for exempt status has to be renewed annually, and a fee of GBP600 is payable annually. See Offshore Tax and Legal Regimes for details of the taxation of Exempt Investment Schemes.

Guernsey Exempt Insurance Companies:

The Income Tax (Exempt Bodies) (Guernsey) Ordinances 1989 and 1992 also cover insurance companies, called Category E bodies. Guernsey residents may not have direct shareholdings in Exempt Insurers, and the exemption does not apply to income originating in Guernsey (other than from bank deposits).

The application for exempt status has to be made annually, accompanied by various types of information, and the fee of £500. Tax due from previous years must have been paid. See Offshore Legal and Tax Regimes for details of the taxation of Exempt Insurers.

Registered insurance companies may take advantage of the Protected Cell (Guernsey) Ordinance 1997, under which multiple cells may exist within one company; the taxation basis of protected cell companies is equivalent to that of exempt companies. Protected cell company status under the 1997 Ordinance is generally reserved for authorised collective investment schemes, insurance companies and closed-ended investment companies.

Version date: 07.05.06