21 February 2024
To help support Islanders with the cost of living, the Minister for Treasury and
Resources, Deputy Elaine Millar, has announced that she will defer the start of the
statutory payment scheme for those former ‘Prior Year Basis’ taxpayers with a 2019
frozen tax liability.
Background
In 2020, as part of a package of measures to help people during the Covid lockdown,
the States Assembly abolished the Prior Year Basis of paying taxes. This kept money in
the pockets of most self-employed people and a large proportion of employed people.
Approximately £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.
Payment Scheme
- The States passed regulations in 2021 creating a payment scheme which would
commence in 2025.
- Taxpayers would have started paying one seventeenth of their 2019 frozen
liability annually, starting from 31 December 2025, until 31 December 2041.
- For most taxpayers, this would equate to less than £35 monthly.
- Subject to States approval, the first instalment will now become due by 31
December 2027 and the last by 31 December 2043.
- Taxpayers could elect to pay the entire sum within 12 months of reaching
pensionable age. Subject to States approval, the new deadline for making such
an election would be 30 September 2026.
Former PYB taxpayers can pay the whole sum or make part payments at any time. Further
information is available at Prior Year Basis (PYB) 2019 tax payment.
Deputy Millar said: "I am pleased to announce the deferral of the payment scheme to help
Islanders with the ongoing concerns surrounding the cost of living. By extending the
deadline until 2027, this decision provides affected Islanders with more breathing room to
navigate their financial commitments effectively.”
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