Working in Jersey

If you spend either half your time in the UK or if you spend 3 months per annum on average in the UK then you are resident here. As a UK resident you are chargeable to UK tax on your worldwide income where ever it arises.

It would easy to sidestep UK tax by setting up an offshore company and to arrange for all the offshore earnings to accrue for the benefit of the company instead of you.

Unfortunately the anti-avoidance legislation was enacted a long time ago.

This provides, in precis, that if a person who is ordinarily resident in the UK (you) makes a transfer of assets (for example the subscription for shares in the offshore company) as a result of which income becomes payable to a person resident or domiciled outside the UK (the offshore company) then the income in question is chargeable to tax on the person in the UK (you).

What you are proposing is not illegal.

Just be aware that you must declare the offshore income as your personal income on your UK return.

There is no automatic right to offset any Jersey tax against your UK liability though in practice this might be allowed.

Setting up and running an offshore company will cost money.

As there is no tax saving is it worth spending that money?

The statutory reference for this answer is to be found in s739 Income and Corporation Taxes Act 1988.

That explains the taxation treatment if the company is resident offshore. But you might not even be able to establish the company is resident offshore. Yes, it may be registered offshore but that does not make it resident offshore. For it to be resident offshore you must be able to demonstarte that the company is managed and controlled offshore. This requires expert advice. If you cannot satisfy HMRC that the company is resident offshore then it will be resident here meaning its profits will be chargeable to UK corporation tax.

I recommend you take advice from a Chartered Tax Adviser before setting up an offshore company.

You can find an adviser local to you by searching at

https://www.tax.org.uk