Jersey’s economic substance for partnerships rules

Jersey (among other jurisdictions) enacted economic substance legislation for companies for financial periods starting on or after 1 January 2019 where the company receives income from performing one of nine relevant activities. This legislation affects Jersey tax resident companies only (other types of entity being outside the scope of the legislation). On reviewing the regime the EU Code of Conduct Group requested that these rules also be extended to partnerships.

The Government of Jersey gave a political commitment to introduce economic substance legislation for partnerships by 30 June 2021. The Taxation (Partnerships - Economic Substance) (Jersey) Law 2021 was subsequently passed by the States Assembly on 29 June 2021. Other jurisdictions such as the Cayman Islands Guernsey and the Isle of Man have also introduced similar legislation (but this...