A LACK of information on the States zero-10 tax strategy could hamper its introduction, according to a leading local accountant. Kemp Le Tissier director Chantelle Le Tissier said the amount of information about the 2008 tax reforms that had published by the States up to now was very limited.

‘While the relevant States departments are, I am sure, working hard to add the flesh to the bones of the resolutions made in recent months, the lack of detailed guidance issued so far is not helping individuals and businesses understand the impact on them.

‘With increases in social security, changes to the way in which owners are taxed on profits received from their companies and new rules relating to property investment and development activities, there is a lot to consider.’

The May Billet d’Etat contained a number of measures being implemented and was supported by the July Billet, which focused on taxation of land and property in Guernsey, including interest relief.

Social Security contributions are set to rise again next year, hitting mainly the higher earners and employers, building on the increases already made in 2007.

Indirect taxes have also been overhauled, with petrol and property rates suffering the highest percentage increases.

Mrs Le Tissier said Kemp Le Tissier was working closely with clients to help them understand the issues that were specific to them.

‘While the majority of companies will benefit from the 0% corporate tax rate, certain banking activities and utility businesses will still pay income on tax profits.

‘The burden of taxation is shifting to Guernsey resident shareholders who will suffer tax on their distributed profits. Given the importance of collecting revenue from this source there will be anti-avoidance legislation in place to stop owners extracting profits from their companies without paying tax.

‘Non-resident shareholders will not be liable to tax on distributions from company trading profits.’

She said it would be important for firms to build up solid relationships with any clients about to be affected by zero-10.

‘Hopefully this will enable our clients to be prepared to face the new challenges ahead.’