Pension income and tax

Taxable pension amounts

The amount of tax you pay depends on your total taxable income less any deductions or reliefs you're entitled to receive.

Allowances, reliefs and deductions for tax

Taxable pension amounts include:

income from state pensions
income from annuities or annuity equivalents
income from approved drawdown schemes
amounts from very small pension scheme fund commutations
lump sums paid from overseas schemes where the lump sum exceeds 30% of the net fund value

Pensioner tax return help video on YouTube

Pension income and taxable Social Security benefits: tax form help

Paying tax on your pension income

If your pension income and all your other sources of income add up to more than your exemption threshold, you'll pay tax on your total taxable income.

Still working

To pay your tax:

if you're employed you can increase the tax deductions your employer makes from your salary to cover the additional tax on your pension income
if you're earnings are 25% or less of your total income you'll make a payment by 31 May (based on 40% of the previous year's tax assessment) and the rest of the balance before the late payment surcharge date
if you're self-employed then the tax will be included in your payment on account
you can also set up a direct debit

Being retired

If you're retired you have 2 payment options:

pay in 2 instalments. A payment on account by 31 May (based on 50% of the previous year's tax assessment) and then the rest of the balance before the late payment surcharge date
spread your payments over the year with a direct debit

Late payment of personal tax

Receiving a pension from abroad

If you receive a pension from another country while you're living in Jersey, it forms part of your total taxable income in Jersey. It may also be subject to tax in the country from which it is paid.

You may be able to request that the pension is paid gross (without the foreign tax being deducted) if we have an international tax agreement covering pensions with the country from which your pension is paid.

You'll need to request a form from the tax authority in the country that the pension arises in and get it certified by us, confirming it's subject to tax in Jersey.

Tax and your pension income: living abroad

If there is no agreement, we'll take into account the foreign tax you are paying when we calculate your Jersey tax liability. You'll need to give us evidence of this.

Living abroad and receiving a Jersey pension

If you live abroad, with the exception of the social security state pension, any Jersey pension or annuity you receive, is taxable in Jersey unless there is an international tax agreement covering pensions with the country you live in.

You'll need to complete form PR1 and get it certified by the tax authority of that country, confirming that you are subject to tax on the income.

If there is no agreement or you don't get the confirmation above, tax will be deducted at source from your pension income at the Jersey standard rate of tax (20%).

Tax and your pension income: living abroad

Being married and having an option to receive a state pension by virtue of your husband's contributions

If you take up this option, the income will be treated as your husband's income for tax purposes. This may affect the amount of second earners relief you receive.

You'll need to check the tax consequences first.

Second earners relief