Guernsey: a global centre of excellence for pensions

In this article, Ogier partner Chris Hards provides an in-depth look at the benefits and distinct features of Guernsey's pension schemes.

With his extensive knowledge in pension planning, Chris explains Guernsey's approach to both local (domestic) and international pension plans, highlighting how these structures can offer advantages to employers based in the Channel Islands and globally.

He outlines the reasons why Guernsey stands out as an ideal location for pension arrangements and discusses the recent introduction of "secondary pensions" – a government initiative designed to enhance retirement savings for employees working in Guernsey – and explores what this means for local businesses.

Discover the key insights below in his top five things to know about Guernsey pensions.

Guernsey: pensions centre of excellence

Guernsey was among the first places globally to regulate pension providers and hosts many of them under a regime that meets international standards. Guernsey has been providing international and domestic pensions for more than 50 years and has established itself as a centre of excellence in the creation, administration and management of pension schemes.

In 2017, additional pension regulations were introduced for individual pension offerings, enhancing Guernsey's regulatory framework and providing individuals, employers and employees with the comfort, security and certainty desired when planning for retirement.

Availability of domestic and international schemes

Guernsey stands out as a rare jurisdiction offering international pension schemes for both individuals and employers. For employers, international plans can be fully tailored to meet the requirements of the employer including offering the same pension plan to employees wherever they are located. This avoids costs and saves time for the employer, as well as offering flexibility to the employee should they relocate.

Guernsey residents can choose from occupational pension schemes, Retirement Annuity Trust Schemes (RATS) and Retirement Annuity Contract Schemes (RACS) for their domestic pensions. RATS and RACS can be structured flexibly so that an individual can craft a scheme solely for their own benefit or join an existing multi-member scheme.

Guernsey also offers pension schemes accommodating both residents and non-residents that allow for tax-neutral transfers from foreign pension schemes. These provisions let individuals consolidate their pension pot while, subject to individual circumstances, retaining any benefits from their original pension scheme.

Pension benefits afforded by Guernsey law

Like elsewhere, pensions in Guernsey receive favourable tax treatment to encourage individuals to save for their retirement. The benefit applies to both individual and occupational schemes. Tax application will differ based on residential status, age and the nature of the benefits being provided.

For non-Guernsey members, Guernsey schemes are generally tax neutral while, for Guernsey residents, tax relieved funds will be subject to tax when drawn but with certain tax-free elements.

Pension flexibility afforded by Guernsey law

A key benefit of choosing a RATS is the ability to control the investment of the fund at member level or advisor level. This allows for favourable tax treatment of the scheme while not losing the ability to direct the nature of investment within certain parameters.

Depending on the scheme's rules, it is generally possible to transfer between schemes, consolidate pension pots and to close membership if the funds are small.

Secondary pensions

On 1 July 2024, new legislation was implemented where Guernsey employers with more than 25 employees were required to offer an "approbated scheme" that complies with Guernsey's secondary pension law. From 1 October 2025, the legislation extends to all employers.

The secondary pension helps employees resident in Guernsey to save for their retirement beyond social security. While the scheme is voluntary, auto enrolment applies unless an employee opts out and employers cannot discourage participation.

The YIP (Your Island Pension) is a scheme open to all employers to enrol their employees. Minimum contribution levels are set to gradually rise reaching a minimum total pension contribution of 10% of earnings by 2032. Although approbated schemes have stricter rules for benefits and transfers than non-approbated schemes, many Guernsey pension providers have adjusted their schemes to allow for members to use the scheme as both their occupational (approbated) scheme and as an additional private pension.

How Ogier can help

For expert legal advice on structuring and managing your pension or incentive plans, Chris Hards and the team at Ogier offer a wealth of experience in private wealth and pension matters. Delivering tailored legal solutions to meet your specific needs. Contact Chris or your usual Ogier contact to learn how the firm can support your objectives with our in-depth expertise.

This article was previously published in Aurigny's EnVoyage magazine.

About Ogier

Ogier is a professional services firm with the knowledge and expertise to handle the most demanding and complex transactions and provide expert, efficient and cost-effective services to all our clients. We regularly win awards for the quality of our client service, our work and our people.

Disclaimer

This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.

Regulatory information can be found under Legal Notice