During a States Assembly meeting on 25 June 2024, Ian Gorst, Jersey’s Minister of External Relations, affirmed Jersey’s intention to engage in discussions regarding an income tax treaty with Portugal.
The objective of the treaty will be to help residents and boost international business by ensuring people and companies aren’t taxed twice on the same income across both countries.
Double taxation treaties (DTTs) serve multiple purposes between two countries. They help determine whether an individual or company is a tax resident, safeguard against double taxation scenarios where the same income is taxed in both countries, and ensure predictability for cross-border trade and investments. In Jersey’s case, DTTs protect its taxing rights and prevent tax avoidance or evasion.
Additionally, these treaties facilitate the exchange of tax-related information between Jersey and other countries, enhancing transparency and compliance. Before taking effect, DTTs undergo parliamentary procedures in both countries. Jersey also engages in tax information exchange through agreements such as Tax Information Exchange Agreements (TIEAs), the Multilateral Convention, and, historically, under the EU Savings Tax Directive with EU member states.
If an agreement is reached, it will be a first between the two nations. The treaty will need to be finalised, signed, and ratified before it can come into effect.
