The Island’s very own
personal pension plan
designed for Jersey residents


Why a Pension Trust?

What is a pension trust?

In December 2007, certain changes were made to the local Jersey Income Tax Law, enabling for the first time the use of Jersey Trusts for personal pension planning.

Up until these changes were made, the majority of Jersey residents were restricted to the use of insurance company schemes as provision for their retirement. Once in retirement, most of these residents had little choice but to purchase an annuity from the same life company with which to provide them an income in retirement.

Whilst annuities have a number of advantages, one of the main disadvantages is that as soon as the annuitant (beneficiary) dies, then so does any future benefit, leaving nothing for the annuitant�s dependants.

In response to the departure of the last personal pension provider in Jersey, a working party of local practitioners was convened by the States of Jersey to recommend alternative solutions to the traditional life company offerings. The result, which came in early December 2007, enabled Jersey trust-based personal pension structures to be established.

This means that with effect from January 2008, Jersey residents are able to enjoy the provisioning and retirement benefits of the Jersey Personal Pension Trust.

The Jersey Personal Pension Trust enables local residents to not only save for their retirement, but also ensure that, for the first time, their retirement savings remain in Jersey and form part of their estate, on death. Furthermore, it at last represents an opportunity to provide local residents with a retirement planning structure for life; a single structure that can be used, not just to provide for retirement, but also to draw an income from whilst in retirement.

To encourage more people to provide for their retirement, a concession allowing for a tax-free lump sum of 30% of the plan value to be taken on retirement has been extended to include trust-based pension plans.

Consequently, those local residents who are about to go into retirement can now transfer their accumulated pension funds into the Jersey Personal Pension Trust. This means they now have a number of options:

  1. Take up to 30% of their accumulated funds as a tax-free cash lump sum
  2. Buy an annuity with some, or all, of the remaining proceeds of their pension pot to provide a guaranteed income; and/or
  3. Invest the remainder into the investment funds that are most appropriate for their circumstances in order to generate a retirement income

Should they die before they get to enjoy all of their retirement savings, they can rest assured that the beneficiaries of their estate will.

For those local residents who are still provisioning for their retirement, the Jersey Personal Pension Trust provides them with probably one of the most flexible pension plans � anywhere.

Jersey has never before had a pension scheme that is so well adapted to the needs and expectations of the Island's residents.