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13.1. GAAR and General Anti-Avoidance Measures

Guernsey’s domestic law contains a general provision allowing tax authorities to make adjustments to counteract the avoidance, reduction, or deferral of tax liability from a transaction or series of transactions.The transaction or series of transactions entered into by a taxpayer will be disregarded if one of the main purposes of the transaction was to avoid liability or obligation under the regulation.

Effective 22 April 2020, it is clarified that tax authorities may apply the general provision and make adjustments where a company having income from large retail business seeks to change its accounting date, without commercial reasons, resulting in reduced tax liability from 20% to 0% (see Sec. 8.1.1.).